(Updates to afternoon)

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Indexes: Dow down 0.42%, S&P 500 up 0.24%, Nasdaq up 0.57%

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Kimberly-Clark ( KMB ) to acquire Kenvue ( KVUE ) for more than $40 billion

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US manufacturing activity contracts in October

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Fed officials offer conflicting viewpoints regarding a

December

rate cut

By Stephen Culp

Nov 3 - The S&P 500 and the Nasdaq advanced on Monday,

with artificial intelligence-related deals driving much of the

gains even as the Federal Reserve's near-term monetary policy

grew increasingly foggy due to scarcity of official U.S.

economic data.

Tech and tech-related firms helped boost the Nasdaq into the

lead, while healthcare companies UnitedHealth Group UNH.N and

Merck MRK.N were off 3.0% and 3.1%, respectively, dragging the

Dow into negative territory.

Among the major drivers to the upside, Amazon ( AMZN ) announced

it struck a $38 billion deal with OpenAI to allow the ChatGPT

maker to run and scale its artificial intelligence workloads on

Amazon Web Services' cloud infrastructure. Amazon's ( AMZN ) stock

advanced 4.4%.

Nvidia ( NVDA ) shares gained 3.2% after U.S. President Donald

Trump said the AI chipmaker's most advanced microchips will be

reserved for U.S. companies and kept out of China and other

countries.

The Philadelphia SE Semiconductor index was up 0.8%.

"We have been seeing fewer and fewer companies keep up with

the tech trade," said Sam Stovall, chief investment strategist

of CFRA Research in New York. "With breadth getting narrower and

narrower, you do sort of wonder if the momentum and the

participation is there."

"The market is getting long in the tooth," Stovall added.

"Investors are of the mindset that maybe we are due for some

sort of digestion of gains."

Kimberly-Clark ( KMB ) shares slid 14.0% after it was

revealed the consumer goods company will buy Tylenol maker

Kenvue ( KVUE ) for more than $40 billion. Kenvue ( KVUE ) advanced

13.9%.

While official economic data remains scarce amid the

ongoing government shutdown, the Institute for Supply Management

and S&P Global released their purchasing managers' indexes,

which showed U.S. factories continue to grapple with uncertainty

stemming from Trump's tariff policies.

The U.S. Supreme Court is expected to hear arguments pertaining

to the legality of Trump's tariffs on Wednesday.

In the wake of last week's expected interest rate cut, the Fed's

next move has become increasingly unclear given the lack of

economic indicators due to the ongoing government shutdown.

Payrolls processor ADP's National Employment index, expected on

Wednesday, could shed light on the state of the U.S. labor

market.

Fed officials offered conflicting viewpoints, with Fed Governor

Stephen Miran making the case for additional rate cuts, but

Chicago Fed President Austan Goolsbee said he was leery of

additional cuts while inflation remains well above the central

bank's 2% annual target.

The Dow Jones Industrial Average fell 201.12 points,

or 0.42%, to 47,361.75, the S&P 500 gained 16.06 points,

or 0.24%, to 6,856.31 and the Nasdaq Composite

gained 135.22 points, or 0.57%, to 23,860.54.

Of the 11 major sectors in the S&P 500, consumer

discretionary and tech enjoyed the only

gains, while materials suffered the largest percentage loss.

Third-quarter earnings season is well underway, with well over

300 of the companies in the S&P 500 having reported. Of those,

83% have beaten analysts' estimates, according to the most

recent LSEG data.

Declining issues outnumbered advancers by a 1.57-to-1 ratio

on the NYSE. There were 149 new highs and 131 new lows on the

NYSE.

On the Nasdaq, 1,733 stocks rose and 2,895 fell as declining

issues outnumbered advancers by a 1.67-to-1 ratio.

The S&P 500 posted 14 new 52-week highs and 31 new lows

while the Nasdaq Composite recorded 67 new highs and 163 new

lows.