Broadcom Stock, Chipmaker Shares Surge; Casino Stocks Fall

Semiconductor stocks gained ground Monday as China tariff concerns dissipated, while one chipmaker got a boost from a major artificial intelligence partnership announcement. Shares of casino operators fell as stormy weather dragged on gaming revenue in a key region.

Major U.S. equities indexes bounced back as President Donald Trump adopted a softer stance on trade relations with China and officials said the leaders of the two countries are still on track for an upcoming meeting. The S&P 500 jumped 1.6%. The Dow was up 1.3%, closing a bit above 46000, while the Nasdaq added 2.2%. For more Investopedia coverage of the day’s major market stories, read here.  

Broadcom (AVGO) shares surged 9.9% after the chipmaker said it would collaborate with ChatGPT maker OpenAI on the development of artificial intelligence accelerator and network systems. The unveiling of Broadcom’s partnership with the world’s most valuable startup came a week after Advanced Micro Devices (AMD) announced its own OpenAI deal.

Nvidia (NVDA) said that its ethernet networking switches would be incorporated into AI data centers by (META) and Oracle (ORCL). The competitive threat from the AI chip behemoth weighed on shares of data center switch provider Arista Networks (ANET), which sank 4.3%. Nvidia’s shares ended the day 2.9% higher.

Other semiconductor stocks gained ground Monday as concerns subsided about a possible intensification of U.S.-China trade tensions. The Philadelphia Semiconductor Index (SOX) jumped 4.9%, clawing back losses posted last week. Among the strongest performers were shares of ON Semiconductor (ON) and Monolithic Power Systems (MPWR), which gained 9.6% and 8.5%, respectively.

A lower percieved likelihood of increased tariffs on goods from China also helped drive a recovery in shares of companies that import a major portion of their products from the world’s second-largest economy. Shares of electronics retailer Best Buy (BBY) bounced about 10% Monday.

Fastenal (FAST) shares fell 7.5%, the most of any S&P 500 stock, after the provider of industrial construction supplies missed expectations with its third-quarter earnings per share. An uptick in selling, general, and administrative costs weighed on profitability. The company said sluggish industrial production affected its performance but highlighted strength in its fastener product line.

Casino operators came under pressure after a report revealed that September gross gaming revenue in Macau fell more than expected. The underperformance of the Asian gambling hotspot reflects a disruption caused by Super Typhoon Ragasa. Storm-related impacts to the region continued in early October, as Typhoon Matmo also resulting in closures and travel cancelations. Las Vegas Sands (LVS) shares were down 6.3%, while Wynn Resorts (WYNN) stock lost 6.2%.