US stocks rallied to the edge of their all-time high on Monday after easing oil prices helped calm Wall Street's worries that inflation could get even worse.
- The S&P 500 jumped 110.78 points, or 1.5%, to 7,600.50 and is just 0.1% below its record set earlier this summer.
- The Dow Jones Industrial Average rose 693.38 points, or 1.3%, to 53,178.41.
- The Nasdaq composite rose 540.04 points, or 2.1%, to 25,913.90.
Brent crude's price fell 4.7% after President Trump said he would hold off on ordering new strikes against Iran, the
AP reports. That helped Treasury yields to fall in the bond market.
Monday's ease in oil prices helped airlines and other companies with big fuel bills lead the market. United Airlines flew 5.8% higher, while American Airlines climbed 5%. Norwegian Cruise Line Holdings steamed 6.6% higher. Boeing jumped 8% after US regulators certified its 737 Max-7 planes, clearing them for commercial service. Tyson Foods rose 2.8% after the meat company reported a slightly stronger profit for the spring than analysts expected. CEO Donnie King said strength is continuing in the company's chicken business and its prepared foods, which include brands like Jimmy Dean and Hillshire Farm.
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Companies in the S&P 500 are on track to deliver earnings per share for the spring that are 47% higher than a year before, according to FactSet, with more than half of the companies in the index having already reported. If that ends up being the case, it would be the strongest growth since the spring of 2021, when the economy was roaring out of the COVID pandemic. Also offering encouragement for profits was a report on Monday showing that growth for US manufacturing accelerated to its strongest level since 2022.
Keeping Wall Street unsettled, though, were swings for stocks of companies that make computer chips. They've been veering up and down for weeks on worries about whether their surging revenues because of the artificial-intelligence boom are sustainable. If AI ends up producing less profit and productivity than hoped, Big Tech companies could curtail their spending sprees on data centers that have helped chip stocks soar to tremendous heights. Micron Technology went from a drop of 6.4% to a gain of 1.7% through the day before ending with a gain of 0.8%, for example. It's up roughly 190% for the year so far.
- The manic swings for AI stocks have been most dramatic in South Korea, where the Kospi index is dominated by just two tech titans, Samsung Electronics and SK Hynix. Seoul's Kospi fell 5.1% Monday, coming off Friday's 17.9% surge that was its best day in history.
- In neighboring Japan, Tokyo's Nikkei 225 fell 0.9% after the United States and Japan confirmed they had moved together to prop up the value of the Japanese yen against the dollar. A stronger yen would help to limit inflation in Japan, but it could also potentially hurt Japan's exporters.
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