(Bloomberg) -- The world's richest man was all over the U.S. stock market on Monday.
By disclosing that he bought a chunk of Twitter Inc., Elon Musk triggered the biggest rally in the social media platform's shares since its debut in 2013, with nearly every other growth stock tailing on those gains-- and to boot, the Nasdaq 100 and the S&P 500 and even the Russell 2000 too.
“Here's a guy that just put a bunch of money back to work into the market,” said Michael O'Rourke, chief market strategist at Jonestrading.
Sentiment was also buoyed by Musk's Tesla Inc., whose shares rose 5.6% after posting record first-quarter deliveries over the weekend that bolstered investor confidence that the company can power through a series of disruptions.
“The headline stories are positive and they're driven by Musk and I think it's helped the growth space out,” O'Rourke said. “It has investors that are licking their wounds feeling a little bit better.”
The tech-heavy Nasdaq 100 Stock Index rose 2%, while an exchange-traded fund that tracks the social media sector gained more than 5%. Among the big advancers were Facebook parent Meta Platforms Inc. with a gain of 4% and Snapchat parent Snap Inc. adding 5.2%. Pinterest Inc. jumped 10% and Twitter closed 27% higher at $49.97.
Musk took a 9.2% stake in Twitter to become the platform's biggest shareholder, a week after hinting he might shake up the social media industry. The stake is worth about $2.89 billion, based on Friday's market close.
“For a stock that's been significantly underowned, it's a Cinderella story for the bulls that Musk has gotten involved with Twitter,” said Dan Ives, managing director and senior equity analyst at WedBush Securities.
“Whether it's Musk or another strategic bidder, this could really rock the social-media world. Musk isn't going to just take a 9% passive stake and go home,” he said.
Cathie Wood's ARK Innovation ETF underscored the risk-on mentality that was fanned by Musk on Monday. The fund that invests in fast-growing companies like Block Inc. and Teladoc Health Inc. rose 4.4%.
Best Month
The moves added up to a strong start for U.S. stocks in April, the month that has been the best for the S&P 500 in the past 25 years.
Hopes are high that stocks will get a further boost this month even as U.S. companies start to report what damage has be done to profit margins by decades-high inflation. Since 1997, the S&P 500 has averaged a return of 2.5% in April, according to data compiled by Bloomberg.
Read more: Best Month for Stocks Now Faces Off With Fed, Inflation Catch
Still, not everybody shared Monday's enthusiasm. U.S. brokerage firm BTIG pointed out that cyclical shares tied to the U.S. economy's health including banks, homebuilders and transports are struggling against the broader stock market, raising questions about the durability of the latest rally.
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