Wall Street kicked off the trading week with a strong rally on Monday, as a retreat in oil prices and Treasury yields helped ease investor concerns about inflation and borrowing costs. The Dow Jones Industrial Average jumped 407 points, or 0.79%, to 52,089.54 at the open, while the S&P 500 climbed 0.7% to 7,690.25 and the Nasdaq Composite surged 1.1% to 26,780.
The gains mark a reversal from last week's mixed performance, when the Dow slipped 1.7% for its worst weekly drop since March, while the S&P 500 finished roughly flat and the Nasdaq added about 0.7%. Friday's close saw the S&P 500 edge up 0.17% to 7,650.50, the Nasdaq gain 0.39% to 26,522.55, and the Dow fall 0.18% to 51,682.64.
Yields and oil ease
Bond yields pulled back from recent highs, providing some relief to equity valuations. The 10-year Treasury yield dropped more than 3 basis points to 4.957% at the open, while the 30-year yield eased to 5.294%. Crude prices also softened, with US WTI down about 3% to $97.09 a barrel and Brent sliding to $100.50. The pullback in energy costs comes after a period of elevated prices that have added to inflation pressures.
Stock movers
Several individual names stood out in early trading. Greenland-linked stocks surged after President Trump announced a security agreement covering the Arctic island. Greenland Energy jumped more than 144%, Greenland Mines rose nearly 70%, and Critical Metals Corp gained over 30%. The move follows the upcoming Trump-Xi summit, where strategic minerals and AI are expected to be key topics.
On the downside, PulteGroup fell more than 15% as the 30-year mortgage rate topped 7% again and the 10-year yield neared 5%, prompting fresh price-target cuts from Wells Fargo and Truist, as well as a "Sell" rating from Seaport Research. Novo Nordisk slipped as much as 7% despite raising its full-year outlook, after oral Wegovy sales of 3.22 billion Danish kroner missed expectations of 3.27 billion. Warner Bros. Discovery rose over 7% on reports that Paramount is in advanced talks with the California Attorney General on concessions to clear antitrust hurdles for the acquisition, with a potential $1.5 billion production investment discussed.
Macro watch
Investors are also weighing a high-profile summit this week between President Trump and President Xi, covering tariffs, critical minerals, and AI, after Treasury Secretary Scott Bessent met Chinese Vice Premier He Lifeng. Geopolitical risk remains elevated after Iran-backed Houthis attacked Saudi Arabia over the weekend, and the US State Department warned Americans to reconsider travel to the Middle East.
The Federal Reserve's first rate hike in three years last week, combined with yields near 5% and oil around $100, keeps the focus on whether inflation pressures are peaking or will prove stickier. The session's direction will hinge on whether oil and yields stay subdued into midday trade and how traders position ahead of the Trump-Xi talks and any fresh Middle East headlines. For more on the potential market impact, see Morgan Stanley's warning on a possible S&P 500 pullback.
As the week progresses, traders will also monitor China's rare earth magnet exports, which fell 20% in August, and AI chip export rules that could be discussed at the summit.
This article is for informational purposes only and does not constitute financial advice.
