Alphabet's AI Boost Drives Market Rebound Ahead of Thanksgiving

The stock market surges on Monday, driven by a strong performance from Alphabet, as investors show renewed confidence in the company's advancements in artificial intelligence. The S&P 500 climbs 1.55% to 6,705.12, while the Nasdaq Composite jumps 2.69% to 22,872.01, marking its best day since May 12. The Dow Jones Industrial Average also rises 202.86 points, or 0.44%, to 46,448.27.

Alphabet Leads the Charge with Gemini 3

Alphabet shares soar 6.3% following the announcement of its upgraded AI model, Gemini 3, which comes nearly eight months after the release of Gemini 2.5. The tech giant's progress in AI fuels optimism among investors, spurring a broader rally in the tech sector. Broadcom, Micron Technology, Palantir Technologies, and AMD all see significant gains, with increases ranging from 4.8% to 11.1%. Other major tech players like Meta, Nvidia, and Amazon also experience positive momentum.

Market Rebounds After Recent Slump

The market's rebound follows a challenging period that saw the S&P 500 slip roughly 2% last week and decline around 2% for the month of November. The Nasdaq, which shed nearly 3% in the prior week, is down more than 3% for the month. The 30-stock Dow fell about 2% last week and is off more than 2% month to date. The recent slide has been attributed to a reevaluation of high valuations in AI-linked stocks, which had powered much of the year's market gains.

Caution Ahead as Trading Volumes Thin

With trading volumes expected to decrease in the coming days and few meaningful catalysts ahead of the Federal Reserve's December policy meeting, volatility could increase. Melissa Brown, managing director of investment decision research at SimCorp, notes that any upcoming economic data, such as September U.S. retail sales and producer price index, could influence the market. 'The market could continue to be okay, but when sentiment is so negative, bad news tends to get exaggerated,' she says. 'When you add on top of that the lower trading volume environment, I think any bad news, maybe the impact is going to be multiplied.'

Fed Officials Signal Potential Rate Cut

San Francisco Federal Reserve President Mary Daly expresses support for an interest rate cut at the central bank's December meeting, citing risks to the labor market. Her comments follow similar remarks from New York Fed President John Williams, who sees more room to lower rates. These signals have led to a sharp repricing in the futures market, with traders now anticipating a potential rate cut in December.

References

• Stock market news for Nov. 24, 2025