Dow Hits Record High as Yen Falls Amid Japan's FX Intervention

The U.S. stock market rallied on Monday, with the Dow Jones Industrial Average hitting a new record high close. The gains were driven by solid manufacturing data and optimism around earnings and U.S.-Iran peace hopes.

The yen slumped to a three-month low after Japan spent nearly $100 billion in FX intervention over 48 hours last week to support its currency. This is the latest move in a long-term effort by Japan to defend its currency, with total spending reaching around $310 billion over the past four years.

Despite recent market volatility, including a chip sector rout and concerns about the yen, investors are focusing on the earnings picture, which is looking bullish. The S&P 500 rebounded to within 0.5% of its record high, and U.S. factory activity expanded in July at its fastest pace in over four years.