US Stocks Near Records on Buyout Deals and Earnings Optimism

U.S. stocks inched closer to their record highs on Monday, boosted by a pair of buyout announcements. The S&P 500 rose by 0.7%, pulling within 0.3% of its all-time high reached earlier this summer. The Dow Jones Industrial Average gained 0.2%, while the Nasdaq composite climbed 1.1% to set a new record. Oil prices remained volatile, with Brent crude fluctuating between $100 and $103 before settling just above $100. In the bond market, the 10-year U.S. Treasury yield increased to 5.31%.

One of the standout moves was PTC, which surged 33.6% after Schneider Electric of France announced it would acquire the software company for $205 per share, valuing the deal at about $22.6 billion. The news lifted other software stocks, with Autodesk rising 5.1%. RXO also jumped 22.8% after C.H. Robinson Worldwide agreed to buy the truck brokerage business for $30.25 per share, though C.H. Robinson itself dropped 10.8%.

Trading was otherwise subdued as investors awaited the start of the latest earnings reporting season. Analysts anticipate nearly 30% year-over-year profit growth for S&P 500 companies, which would mark the third consecutive quarter of growth above 25%. Despite various economic concerns, strong corporate earnings have helped propel stocks near record levels. Oil price swings, driven by uncertainty around the war with Iran, have added to market volatility, with Brent crude settling at $100.32, down 1.9%.

The 10-year U.S. Treasury yield rose to 5.31%, nearing its highest level since 2002, reflecting worries about high oil prices and inflation. The strength of the U.S. economy, fueled by AI data center investments and consumer spending, has contributed to rising yields. A mixed report on the U.S. services sector showed continued growth but at a slower pace than expected, with input prices rising faster, a potential inflation signal. Wall Street anticipates at least one more Federal Reserve interest rate hike by year-end.

Internationally, France’s CAC 40 fell 0.8% amid concerns over the country’s debt and budget strains. Meanwhile, Japan’s Nikkei 225 surged 2.4%, led by gains in technology stocks.