Wall Street kicked off the week on a high note as optimism grew that Washington could soon end the record-breaking government shutdown. The Nasdaq Composite (IXIC) surged 1.6%, the S&P 500 (GSPC) climbed nearly 1%, and the Dow Jones Industrial Average (DJI) added 0.4% by midday.
Investors piled back into risk assets, with tech stocks leading the rebound after a hard stretch for megacap names. The renewed optimism came as the Senate moved forward with a bipartisan funding bill to reopen the government, offering a glimmer of stability after weeks of uncertainty that weighed on consumer sentiment and delayed key economic data releases.
Market Movers:
- Cogent Biosciences (COGT) +127% — Shares skyrocketed after the company announced positive Phase 3 results for its cancer therapy bezuclastinib. The drug showed a strong efficacy advantage over the current standard of care, positioning Cogent for a new drug application in early 2026 and cementing its credibility in the targeted oncology space.
- Diageo (DEO) +5% — The beverage giant rallied after naming former Tesco CEO Dave Lewis as its next chief executive, effective January 2026. Investors welcomed the leadership change as a potential turnaround catalyst following a challenging year of slowing sales growth and inflationary pressures.
- Rumble (RUM) +9% — The digital media company jumped after unveiling an all-stock acquisition of German AI cloud operator Northern Data in a deal valued at roughly $767 million. The move expands Rumble’s AI infrastructure footprint, with Tether set to become a key partner and GPU customer through a $150 million leasing agreement.
- Metsera (MTSR) -15% — Shares plunged after Novo Nordisk confirmed it would not raise its takeover bid, leaving Pfizer as the winning suitor with an $86.25-per-share cash offer. The resolution ends a heated bidding war that had kept biotech investors on edge for weeks.
- monday.com (MNDY) -15% — Despite strong third-quarter earnings, shares tumbled after the software firm guided for softer-than-expected Q4 revenue. The cautious outlook overshadowed improving profitability and long-term growth plans, prompting investors to take profits.
- Oscar Health (OSCR) -15% — Health insurers with ACA exposure sold off after President Donald Trump called for healthcare funding to flow directly to individuals rather than insurers. The comments added fresh political uncertainty to a sector already facing subsidy negotiations amid the government shutdown.
Shutdown Progress Causes Market Optimism
The latest rally came after lawmakers moved closer to ending the 39-day government shutdown, which has strained federal services and delayed key inflation data. The proposed bill would reopen the government through January 30, temporarily resolving funding gaps but leaving longer-term subsidy disputes unresolved.
Investors viewed the development as a step toward restoring confidence in the economy. The prolonged shutdown has disrupted the release of critical indicators such as the Consumer Price Index (CPI) and Producer Price Index (PPI), forcing Wall Street to navigate without fresh inflation data. Analysts warn that even if the government reopens this week, missing datasets may take weeks to recover — or could be lost altogether.
Tech Rebounds After Last Week’s Sell-Off
Tech stocks regained their footing, helping lift broader indices. Nvidia (NVDA) surged more than 4%, leading gains among the “Magnificent Seven” after the Senate’s progress on the shutdown bill eased concerns about delayed federal tech spending. Meta (META), Microsoft (MSFT), Alphabet (GOOG), and Amazon (AMZN) all climbed between 1% and 3%.
The rally followed the sector’s worst weekly drop since April, as investors questioned whether AI valuations had stretched too far. But Monday’s rebound suggests traders remain confident in tech’s long-term earnings potential — especially as forecasts from UBS and Morgan Stanley point to continued AI-driven growth into 2026.
Airlines Rise, Then Fade as Shutdown Lingers
Airline stocks opened higher on the shutdown news but later pared gains as travel disruptions persisted. Delta Air Lines (DAL) and United Airlines (UAL) initially climbed before slipping into negative territory, while JetBlue (JBLU) and Southwest (LUV) followed a similar pattern.
The Department of Transportation has ordered airports to reduce capacity by up to 10% amid staffing shortages, causing widespread flight cancellations just ahead of the holiday season. Chicago O’Hare and New York’s LaGuardia remain the most affected, with more than 8% of scheduled flights canceled Monday morning.
Looking Ahead
Investors will turn their focus to inflation updates and corporate earnings once government data resumes. Upcoming reports from Disney (DIS), Paramount Skydance (PSKY), and Rocket Lab (RKLB) could provide early clues on consumer and tech demand trends. While near-term volatility remains likely, analysts expect a shutdown resolution and a dovish Fed tone could help extend the market’s recovery into year-end — provided inflation and growth data eventually confirm the economy’s resilience.