NEW YORK / RankWire.AI / – U.S. equities experienced a rally on Monday, with major tech stocks advancing and crude oil prices dropping sharply, leading the Dow Jones Industrial Average to surge by 693.38 points, or 1.32%, closing at a record 53,178.41. The S&P 500 increased 1.48% to 7,600.50, just shy of its historic peak, while the Nasdaq Composite gained 2.13% to 25,913.90, outperforming the other major indexes. The market session began August with widespread gains across both large and small-cap companies.
Much of the upward movement was driven by stocks in the technology and communication services sectors. Leading the charge, Meta Platforms and Alphabet contributed to a 4.3% rise in the S&P 500 communication services sector, which was the strongest performance among the 11 sectors. Amazon’s stock jumped 4.6% after surpassing a $3 trillion market valuation for the first time following its quarterly earnings report. Additionally, an exchange-traded fund that tracks seven top technology firms increased nearly 4%, reflecting robust investor demand for the largest growth stocks.
The decline in crude oil prices further bolstered market sentiment. Brent crude settled 4.7% lower at $83.77 a barrel after President Donald Trump announced that the United States would delay new strikes against Iran. Trump also stated that talks would focus on reopening the Strait of Hormuz, although Iran denied that any negotiations had been scheduled. The drop in oil prices eased immediate inflationary pressures and contributed to lower Treasury yields during the trading session. Energy stocks decreased by 1.2%, making the sector the weakest performer of the day.
Falling oil prices alleviate market concerns
The benchmark 10-year Treasury yield moved to approximately 4.68%, down from late Friday levels, which reduced borrowing costs for growth-oriented companies, whose valuations often react strongly to interest rate fluctuations. The Federal Reserve remained in focus after recent inflation concerns and rising energy prices. New York Federal Reserve President John Williams commented that inflation pressures should gradually ease. As bond prices increased and yields fell, investors kept a close watch on upcoming labor market data.
The upward trend extended beyond the biggest technology firms, with the Russell 2000 index of smaller companies climbing 1.7% to 2,981.91. On the New York Stock Exchange, advancing stocks outnumbered decliners by 2.62 to 1, while on the Nasdaq, the ratio was 3.01 to 1. Meanwhile, trading volume reached 19.36 billion shares, exceeding the 20-day average of 17.66 billion. The S&P 500 achieved 15 new 52-week highs and recorded one new low.
Corporate earnings bolster market momentum
Another factor supporting the rally was corporate earnings, with 304 S&P 500 companies having reported through Friday, showing an average quarterly growth of 29.3%. Notably, approximately 85.2% of these companies surpassed analyst estimates, according to data provider LSEG. SpaceX saw its stock rise 5.6% ahead of its first quarterly report as a publicly traded entity, while Marriott International’s shares declined by 7% after issuing a third-quarter profit forecast below expectations.
The Dow’s closing at a new high marked a broad start to August following a challenging July for certain market segments. Technology stocks had faced pressure from concerns related to artificial intelligence investments, interest rate increases, and geopolitical tensions involving the U.S. and Iran. The gains on Monday pushed the S&P 500 within 0.1% of its all-time peak and extended the Nasdaq’s upward trend. Year-to-date, the Dow is up by 10.6%, the S&P 500 has gained 11%, and the Nasdaq has increased by 11.5%.