US stocks closed higher on Monday after Senate lawmakers advanced a procedural measure paving the way for a deal to end the historic federal government shutdown.
The Dow Jones Industrial Average climbed 381 points, or 0.81%, to 47,368. The S&P 500 gained 1.54% to 6,832, while the Nasdaq Composite surged 2.27% to 23,527.
AI stocks lead rebound
Nvidia, Broadcom and other major artificial intelligence stocks led the rally as investors regained their appetite for risk. Nvidia jumped 5.5% by late trade, while Alphabet rose 4% and Microsoft added 1.9%, snapping its eight day losing streak, its longest slide since 2011.
The gains marked a reversal from last week, when fears about overvalued AI names dragged the market lower. The Nasdaq had suffered its worst week since April, falling 3%, while the S&P 500 and Dow each slipped more than 1%.
Senate progress lifts sentiment
The Senate’s procedural vote, requiring at least 60 yes votes, passed with support from eight Democrats who broke with party leadership. The deal would reopen the government through January, reverse recent mass federal layoffs, and include protections for government workers.
However, it omits an extension of Affordable Care Act subsidies, a key Democratic priority, though lawmakers plan to hold a separate vote on the issue in December. A final Senate vote and House approval are still required before the agreement takes effect.
House Speaker Mike Johnson has urged members to return to Washington, saying he expects a vote “as soon as possible” this week.
Economic impact of the shutdown
The prolonged shutdown has weakened consumer confidence, now at its lowest level in more than three years, according to the University of Michigan survey released Friday. The closure has also halted the release of key economic reports, including this week’s consumer and producer price indexes.
ASX set to open higher
Australian shares are expected to open stronger, tracking Wall Street’s gains, with SPI futures pointing to a 0.49% rise.
Key local highlights today include results from Commonwealth Bank and Bendigo and Adelaide Bank, along with annual meetings for Coles Group, Abacus Storage King, Cromwell Property Group, Downer EDI and Goodman Group.
Data releases on consumer and business confidence are also due, while across the Tasman, New Zealand will publish fourth quarter inflation expectations.
