Tech Rally Lifts Nasdaq to Record as Nvidia, Microsoft Gain; SpaceX Rallies, Intel Slips

Microsoft shares rose after Melius Research analyst Ben Reitzes upgraded the stock to buy from hold and raised his price target to $665 from $465, implying more than 25% upside from around $525. In a note titled 'The adults are in charge,' Reitzes wrote that Microsoft's experienced leadership and steady hand would be rewarded as AI safety concerns raised by Anthropic CEO Dario Amodei and others strengthen demand for Microsoft and cybersecurity providers. He said Microsoft may be more insulated from agentic threats and sees a credible path for Azure growth to exceed 50% as supply catches up with demand, pricing firms and OpenAI ramps. The CNBC Investing Club said the argument aligns with its view that Microsoft's Copilot pivot to enterprise makes it a safe space for companies adopting AI.

SpaceX shares rose almost 8% on Monday, reaching their highest since mid-June, after Morgan Stanley analysts called the stock 'cheap' at current prices and recommended buying before the next Starship test flight and third-quarter earnings expected in late October. The note highlighted future AI product releases, Starship progress and additional neocloud contracts, and set a $300 price target, about 75% above Monday's $171.09 close. The rally returned Elon Musk to trillionaire status, with Forbes' real-time billionaires list putting his net worth at $1.03 trillion, including his holdings in Tesla and SpaceX. Late last week, SpaceX conducted multiple historic flights in a single day, including a crewed NASA mission to the International Space Station and a separate launch of Google AI chips into orbit.

SpaceX went public on June 12 and hit a record close of $201.80 on June 16; the shares bottomed in early August and have since climbed about 58%. Its AI business, built through last year's acquisition of Musk's xAI and the recent acquisition of Cursor, is generating revenue by renting capacity to companies including Google and Anthropic, even as its homegrown Grok model has not taken off compared with leading models from OpenAI and Anthropic. The Pentagon appointed Musk as co-lead of Project Meridian, an initiative to identify weapons, technologies and military capabilities the U.S. may need in future wars, CNBC reported; SpaceX has earned more than $12.7 billion to date from work with the Defense Department, according to FedScout. Musk was absent from a New York City Council hearing on AI regulation where representatives from OpenAI, Anthropic, Google and Meta testified. Councilmember Shekar Krishnan said AI has inflated valuations, stolen public land for data centers and increased the net worth of AI CEOs like Musk, who became the first trillionaire.

Intel shares moved lower after Elon Musk confirmed in a post on X that his companies are in talks with Taiwan Semiconductor Manufacturing to potentially partner on the massive Terafab AI manufacturing project. Intel had been named a partner in Terafab last April, and Musk said on Tesla's first-quarter 2026 earnings call that the project would use Intel's upcoming 14A manufacturing process. CNBC's Investing Club said bringing in TSMC could reduce Intel's role in the project, and with Intel shares up about 30% since the beginning of September, some profit-taking was reasonable. The club said it did not change its view on Intel, which is still expected to play a role in Terafab, a project years away from becoming operational and so large—1 terawatt of compute per year, or 1,000 gigawatts—that it is likely to have multiple partners. Intel's central processing units are expected to be in short supply because of strong demand from enterprise and personal agentic workloads, the club said.

The broader market saw materials and energy stocks trade solidly higher, while the interest rate-sensitive real estate sector was the only group in the red. Apple slipped, while Alphabet, Amazon and Tesla also traded higher. Bond yields continued to climb, with the 10-year Treasury yield hitting a new high for the year after a volatile session last Friday, when bond prices initially rallied on a softer-than-expected jobs report before selling off. Bloomberg reported that political upheaval in Europe and fiscal worries sent the euro to its weakest since May 2025, boosting the dollar's haven appeal, while oil prices remained elevated. There were no major earnings scheduled for Monday evening or before the bell on Tuesday. Marvell is hosting an Investor Day on Tuesday, and Fed officials John Williams, Michelle Bowman, Jeffrey Schmid and Lorie Logan are scheduled to speak.