Dow Surges Past Record High as Oil Prices Plummet
Wall Street indices rallied on Monday, with the Dow Jones Industrial Average closing at a record high level of 53,178. The gains came despite prevailing caution over the massive selloff in chip stocks and ongoing concerns about AI worries.
The strong performance was driven by falling oil prices and robust quarterly earnings. Oil prices had soared to as high as $102 per barrel last month due to escalating US-Iran conflict, but they declined after US President Donald Trump announced that he has decided to postpone new strikes against Iran at the urging of allies in the region.
US Treasury yields also fell, with the yield on benchmark 10-year notes dropping 6.13 basis points to 4.684%. The tech sector led the gains, with Boeing shares surging over 8% and Amazon shares rising around 5% after its market cap surpassed $3 trillion for the first time ever.
However, caution is still warranted as markets are pricing in a 64.5% chance of a rate hike of at least 25 basis points at the Fed's September meeting. Additionally, Iran pushed back on Trump’s claims, stating that there were no ongoing negotiations with the United States and that no meetings had been scheduled.