US stocks rose on Monday amid gains for oil stocks after the US military strike and capture of President Maduro in Venezuela, while a revival in optimism for AI demand buoyed tech names.
The blue chip-focused Dow Jones Industrial Average (^DJI) rose over 1%, or 500 points. Meanwhile, the S&P 500 (^GSPC) gained 0.5% and the tech-heavy Nasdaq Composite (^IXIC) added 0.8% following a mixed end to Friday’s session.
The US military action in Venezuela over the weekend took focus as markets headed into the first full trading week of the new year. But stocks leaned higher as strategists largely downplayed the long-term economic fallout and upbeat developments at Nvidia (NVDA) suppliers boosted appetite for the AI trade.
President Trump said Saturday that the US would “run” Venezuela “until such time as we can do a safe, proper and judicious transition.” On Sunday, Secretary of State Marco Rubio struck a more measured tone, saying the US has “a tremendous amount of leverage” to achieve its objectives while stopping short of saying Washington would directly govern the country.
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Shares in US oil majors rose on the prospect that they would benefit from a rebuilding of Venezuela’s energy-producing infrastructure promised by Trump. Chevron (CVX) stock popped nearly 4%, while oil services giant Halliburton (HAL) jumped over 7%, alongside gains for their peers.
Venezuela currently produces less than 1 million barrels of oil per day, under 1% of global output, limiting the potential impact on energy markets. Futures for US benchmark West Texas Intermediate (CL=F) crude and international benchmark Brent (BZ=F) both ticked higher by around 1% Monday morning.
Meanwhile, gold (GC=F) jumped and the dollar (DX-Y.NYB) gained as traders weighed the additional geopolitical risks. The benchmark 10-year Treasury yield (^TNX) slipped to hover around 4.17%, with US bonds on track for their first gains in a week.
Against that background, TSMC (TSM) shares surged after Goldman Sachs raised its price target for the contract chipmaker, citing expectations for another year of solid growth. Meanwhile, Taiwan’s Foxconn (2317.TW, HNHPF) — Nvidia‘s biggest server maker and Apple‘s top iPhone assembler — reported record fourth quarter revenue on Monday, driven by strong demand for AI products.
The strong start to the year for the AI trade sets the stage for the CES marquee tech show in Las Vegas, which unofficially kicks off with Nvidia CEO Jensen Huang’s keynote address at 4 p.m. ET Monday.