Record Highs as Iran Deal Hopes and AI Earnings Boost US Stocks

The S&P 500 and Dow Jones Industrial Average closed at record highs on Monday, driven by strong earnings from AI-related companies and hopes for a deal in the Iran conflict.

Crude prices fell around 5% after a Qatari official said efforts to secure a diplomatic resolution were continuing. US Treasury Secretary Scott Bessent stated that a deal with Iran could come within the next two days, which contributed to lower oil prices and decreased expectations for a rate hike from the Federal Reserve.

The earnings reports from companies like Caterpillar and Palantir assuaged demand concerns and supported the rally in the stock market. The Dow rose 907.47 points, or 1.71%, to 54,085.88, while the S&P 500 gained 136.02 points, or 1.79%, to 7,736.52.

Chip stocks and tech sectors led the rally, with the Philadelphia Semiconductor index shooting up 6.6% and the S&P 500 tech sector gaining 4.1%. Results from corporate earnings have been robust, with 85.2% of companies beating estimates, according to LSEG data.