Nasdaq, S&P close higher as investors await Nvidia earnings

Tesla shares rise 5.6% as media reports suggest Trump may relax rules

CVS Health shares rise 5.4% as new board members are appointed in Glenview deal

Nvidia shares fell 1.3% ahead of its quarterly earnings release on Wednesday

Indexes: Dow down 0.13%, S&P up 0.39%, Nasdaq up 0.60%

Nov 18 (Reuters) - The Nasdaq and S&P 500 ended higher on Monday, recovering some losses as investors anticipated quarterly earnings from artificial intelligence leaders Nvidia (NVDA.O), opens in new tab, and Tesla (TSLA.O), opens in new tab, rising on possible favorable policy changes from the incoming Trump administration.

Nvidia reports third-quarter results on Wednesday, when investors will assess demand for its chips and the sustainability of the artificial intelligence boom that has driven sharp market gains this year.

The chip designer has contributed 20% of the S&P 500's return over the past year and is expected to post a nearly 25% increase in earnings per share in the third quarter, according to Bank of America Global Research. Nvidia shares fell 1.3% following reports that its new AI chips were overheating in servers.

"Even though Nvidia was the last of the big seven to report, you can see a significant uptick in earnings and attention," said Carol Schleif, chief investment officer at BMO Family Office. "It's worth watching, but it doesn't feel like it's getting the same attention it did a quarter or two ago."

The Dow Jones Industrial Average (.DJI) fell 55.39 points, or 0.13%, to 43,389.60, the S&P 500 (.SPX) gained 23.00 points, or 0.39%, to 5,893.62, and the Nasdaq Composite (.IXIC) added 111.69 points, or 0.60%, to 18,791.81.

Energy (.SPNY) stocks led the S&P higher, rising 1.05%, while consumer discretionary (.SPLRCD) stocks also rose 1.04%. Tesla rose 5.6% after Bloomberg reported that members of President-elect Donald Trump's transition team are seeking to ease U.S. regulations on self-driving cars. Industrial (.SPLRCI) stocks were the biggest losers.

CVS Health (CVS.N) Opens in a new tab shares rose 5.4% after the health insurer said it would add four new members to its board of directors under an agreement with Glenview Capital Management.

“I think there’s likely to be quite a bit of volatility in a lot of specific sectors until Trump reveals more of his new choices later this month,” Schleif said.

Stock indexes have given back some of the big gains that followed Trump's decisive victory, but Wall Street remains in a fairly good position as 2024 comes to a close.

The S&P 500 (.SPX) opens in new tab and the Nasdaq (.IXIC) opens in new tab both posted their biggest weekly declines in more than two months last week amid expectations that the Federal Reserve will slow the pace of policy easing and uncertainty over the impact of Trump's cabinet appointments.

Results from major retailers including Walmart Inc WMT.N, Lowe's Companies Inc LOW.N and Target Corp TGT.N will be closely watched this week to gauge the strength of the U.S. consumer as the critical holiday shopping season gets underway.

Advancing issues outnumbered declining ones on the NYSE by a 1.71-to-1 ratio, with 159 issues setting new highs and 88 new lows.

The Nasdaq Composite Index rose 2,158 stocks and fell 2,150, with advancers outnumbering decliners by a 1:1 ratio. The S&P 500 index posted 29 new 52-week highs and 13 new lows, while the Nasdaq Composite Index posted 69 new highs and 265 new lows.

Volume on U.S. exchanges was 14.94 billion shares, compared with the 14.12 billion average for the last 20 trading days.