NEW YORK, April 29 (Reuters) - U.S. stocks rose on Monday, with sharp gains for Tesla and Apple leading the way, as investors looked toward what the Federal Reserve would say about the interest rate outlook after its policy meeting this week.
Traders expected the Fed to keep rates unchanged while striking a hawkish tone.
Tesla (TSLA.O), opens new tab shares surged 15%, after the electric vehicle maker made progress in securing regulatory approval to launch its advanced driver-assistance program in China, its second-largest market after the U.S.
Apple (AAPL.O), opens new tab gained 3.1% following a report that the iPhone maker had renewed discussions with OpenAI about using the startup's generative artificial intelligence (AI) technology. Bernstein upgraded Apple's stock to "outperform".
Other megacap stocks were trading lower. Alphabet (GOOGL.O), opens new tab, Meta Platforms (META.O), opens new tab, Nvidia (NVDA.O), opens new tab and Microsoft (MSFT.O), opens new tab, were down between 0.3% and 3.2%.
Nine out of 11 S&P 500 sectors (.SPX), opens new tab were higher led by stocks in consumer discretionary, utilities, real estates, materials and industrials.
"The bigger question than rates, because they're not going to cut this week, is how hawkish they're going to speak because they've already been pretty hawkish," said Thomas Hayes, chairman at hedge fund Great Hill Capital in New York.
Money markets are pricing in about 35 basis points (bps) of interest rate cuts this year, down from about 150 bps seen at the beginning of the year, according to LSEG.
At 2:48 p.m. the Dow Jones Industrial Average (.DJI), opens new tab rose 113.70 points, or 0.30%, to 38,353.36, the S&P 500 (.SPX), opens new tab gained 10.10 points, or 0.19%, to 5,109.84 and the Nasdaq Composite (.IXIC), opens new tab gained 39.69 points, or 0.25%, to 15,967.59.
Domino's Pizza (DPZ.N), opens new tab jumped nearly 5% after topping expectations for first-quarter same-store sales. Of the 233 companies in the S&P 500 that have reported quarterly earnings, 78.1% surpassed analyst expectations, compared with a long-term average of 67%, according to LSEG data.
Paramount Global (PARA.O), opens new tab gained 3.5% after a report that the Redstone family and Skydance Media CEO David Ellison have made concessions to make a potential change in control of the streaming firm more appealing for other investors.
"The overall momentum is still to the upside and it's an important week, with a ton of earnings, the Fed on Wednesday and nonfarm payrolls on Friday, and the path of least resistance is higher," said Bill Strazzullo, chief market strategist at Bell Curve Trading in Boston.
Meanwhile, the Japanese yen jumped against the dollar on Monday, with traders citing yen-buying intervention by authorities trying to support a currency languishing at levels last seen over three decades ago
Advancing issues outnumbered decliners by a 2.8-to-1 ratio on the NYSE. On the Nasdaq, 2,640 stocks rose and 1,514 fell as advancing issues outnumbered decliners by a 1.74-to-1 ratio.
The S&P 500 posted 18 new 52-week highs and one new low while the Nasdaq recorded 70 new highs and 55 new lows.
Reporting by Chibuike Oguh in New York; additional reporting by Shristi Achar A and Johann M Cherian in Bengaluru; Editing by David Gregorio