US Stock Market Close: Nasdaq Surges Over 4%, Chinese ADRs Outperform, Golden Dragon Index Outpaces Broader Market

On Monday (May 12), US stocks opened higher and continued to rise, with the three major indices closing significantly up and all reaching their highest levels since March.

By the close, the S&P 500 rose 3.26% to 5,844.19 points, and the Nasdaq Composite Index rose 4.35% to 18,708.34 points, both hitting new closing highs since March 3. The Dow Jones Industrial Average rose 2.81% to 42,410.10 points, marking a new closing high since March 27.

Meanwhile, the year-to-date declines for the Dow and the S&P 500 had narrowed to 0.32% and 0.64%, respectively, while the Nasdaq's cumulative decline was 3.12%. Market data also showed that, driven by large-cap tech stocks, the Nasdaq 100 Index had rebounded more than 20% from its lows the previous month, entering a "technical bull market."

Earlier in the day, the "Joint Statement on the US-China Geneva Economic and Trade Talks" was released, with both sides committing to take a series of measures by May 14, 2025, including revising and eliminating additional tariffs on each other's goods, as well as suspending or removing non-tariff countermeasures.

The statement also indicated that the two sides would establish a mechanism to continue consultations on economic and trade relations, possibly in the US, China, or a third country. Shares of US companies most reliant on Chinese goods saw the largest gains, with Best Buy closing up 6.56%, Dell Technologies up 7.83%, and Amazon up 8.07%.

Jeff Kilburg, CEO of KKM Financial, commented that the rise in US stocks was due to investors being surprised by the speed of progress in the US-China economic and trade talks. Carol Schleif of BMO Private Wealth stated that the establishment of a framework for ongoing discussions between the US and China was exactly what the stock market hoped to see.

Jeff Buchbinder, chief equity strategist at LPL Financial, said, "This is a huge surprise, but it's not a trade deal. There's still more work to be done."

In addition, US stocks may have also been boosted by the House Republicans' tax draft. According to the draft text, House Republicans proposed tax cuts exceeding $4 trillion over the next decade, while cutting spending by at least $1.5 trillion.

Performance of Popular Stocks

Large-cap tech stocks collectively rose, with (ranked by market capitalization) Microsoft up 2.4%, Apple up 6.31%, Nvidia up 5.44%, regaining a market capitalization above $3 trillion. Amazon rose 8.07%, Google Class C rose 3.37%, Meta rose 7.92%, Broadcom rose 6.43%, and Tesla rose 6.75%.

The Philadelphia Semiconductor Index closed up 7.04%, with all 30 component stocks rising. Larger-cap companies such as TSMC rose 5.93%, ASML rose 6.23%, AMD rose 5.13%, Texas Instruments rose 8.71%, Qualcomm rose 4.78%, Applied Materials rose 7.96%, and Arm Holdings rose 7.78%.

Defensive stocks declined, with Coca-Cola falling 1.4%, Philip Morris International dropping 2.87%, and AT&T slipping 2.98%.

Chinese ADRs outperformed the broader market, with the Nasdaq Golden Dragon China Index rising 5.4%.

Most popular Chinese ADRs closed higher, with Zai Lab surging 14.46%, TAL Education Group gaining 8.81%, XPeng Motors rising 7.59%, Li Auto increasing 6.57%, JD.com advancing 6.47%, Pinduoduo climbing 6.14%, NIO up 5.79%, Alibaba Group Holding rising 5.76%, Baidu gaining 5.08%, New Oriental Education & Technology Group increasing 4.48%, and Tencent Music Entertainment Group rising 1.78%.

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