(For a Reuters live blog on U.S., UK and European stock

markets, click or type LIVE/ in a news window.)

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Weekly jobless claims at 211,000, below estimates

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Tesla down after deliveries data

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Crypto stocks trade higher on bitcoin strength

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Indexes up: Dow 0.8%, S&P 0.75%, Nasdaq 0.82%

(Updates after markets open)

By Johann M Cherian and Purvi Agarwal

Jan 2 (Reuters) - Wall Street's main indexes rose in the

first trading session of 2025 as investors pinned their hopes on

a fresh political landscape and more interest rate cuts, but

Tesla limited gains on the Nasdaq after a dour deliveries

report.

At 09:56 a.m. ET, the Dow Jones Industrial Average

rose 339.67 points, or 0.80%, to 42,885.17, the S&P 500

gained 43.93 points, or 0.75%, to 5,925.56 and the Nasdaq

Composite gained 158.61 points, or 0.82%, to 19,469.40.

An index tracking small-cap stocks also rose

1.4%.

Eight out of the 11 S&P 500 sectors advanced, led by energy

stocks, while real estate dipped 0.1%.

Tesla, down 3.6%, touched an over three-week low

after reporting its first fall in annual deliveries, missing CEO

Elon Musk's promise of slight growth in 2024, as incentives

failed to stem a decline in demand for its aging line-up of

electric vehicles.

"You have to put the perspective of the total deliveries in

total production against the fact that this is a stock that has

had just an amazing performance in 2024," said Art Hogan, chief

market strategist at B Riley Wealth.

"Post-election, any modicum of disappointing news might

have an outsized impact on the stock's price."

The stock had soared after the U.S. election given

Musk's close ties with President-elect Donald Trump.

Among the first datasets of 2025, a Labor Department

report showed jobless claims unexpectedly fell last week,

consistent with a healthy labor market. Separately, a final

estimate of S&P Global's manufacturing survey showed activity

stood at 49.4 in December, compared with a previous estimate of

48.3.

Wall Street's main indexes had a stellar 2024, with the

benchmark S&P 500 notching its best two-year run since

1997-1998.

The main catalysts were the Federal Reserve easing interest

rates for the first time since 2020, investor hype around

artificial intelligence and expectations of companies

potentially benefiting from Trump's policies.

Equity valuations are sitting above their long-term

averages, but could be justified if corporate profits stay

strong.

However, 2024's rally ended with the S&P 500 and the Dow

posting monthly declines in December as markets priced in

Trump's policy proposals to be inflationary and likely to slow

down the Fed's policy easing pace this year.

With inflation still above the 2% target, traders see the

central bank leaving interest rates unchanged at its meeting

later this month, and expect borrowing costs to be lowered by

about 50 basis points by year-end, according to the CME Group's

FedWatch Tool.

Markets also weighed the likelihood that the new

administration could issue more debt to finance its policies,

which could worsen market volatility. The yield on the 10-year

benchmark Treasury note hovered near an eight-month

high.

Among other megacaps, Meta and Amazon.com ( AMZN )

added over 1.4% each, while chip stocks Nvidia ( NVDA ) and

Broadcom ( AVGO ) climbed 1.6% and 2%, respectively.

Crypto stocks such as MicroStrategy ( MSTR ) and MARA

Holdings ( MARA ) rose 6% and 7.8%, respectively, tracking

higher bitcoin prices.

Advancing issues outnumbered decliners by a 5.29-to-1 ratio

on the NYSE and by a 3.69-to-1 ratio on the Nasdaq.

The S&P 500 posted one new 52-week high and no new lows

while the Nasdaq Composite recorded 30 new highs and 7 new lows.