US stock markets saw significant gains on Monday, with the tech-heavy Nasdaq Composite reaching a record high, up 2.26% to 27122.09. The S&P 500 rose 1.49% to 7764.70, and the Dow Jones Industrial Average increased by 0.71% to 52048.83. This rally was largely fueled by renewed optimism in the artificial intelligence sector, as fears about "extinction risk" subsided and traders returned to bets on a prolonged AI boom. Chipmakers, seen as major beneficiaries of data-center development, performed particularly well. Advanced Micro Devices (AMD) surged 9.9% to $615.52, pushing its market capitalization above $1 trillion for the first time. Intel also rose 13%, and Micron gained 2.3%.
The surge in AI-related stocks was further boosted by Meta (META) soaring 6.7% after Wells Fargo upgraded its price target, citing a strong start for its Muse AI agent. Accenture also gained 3.2% following its partnership with Anthropic to invest $2 billion in AI evaluation. Nvidia struck a deal with Swedish autonomous-truck maker Einride to increase self-driving vehicle production. However, Anthropic's multibillion-dollar initial public offering was pushed to November, later than anticipated by investors, reflecting a recent call for a slowdown in AI development.
Oil futures tumbled, with prices falling $4.52, or 4.5%, to $95.78 a barrel, after President Donald Trump signaled openness to meeting Iranian officials at the United Nations General Assembly. This diplomatic overture offset the impact of ongoing Houthi attacks on Saudi Arabian infrastructure. The decline in oil prices also contributed to a retreat in Treasury yields. The 10-year Treasury note yield declined 0.033 percentage point to 4.962%, while the two-year Treasury yield rose slightly by 0.009 percentage point to 4.751%, its highest close since July 1, 2024. The 30-year bond yield fell 0.031 percentage point to 5.296%. Concerns about inflation and the Federal Reserve's policy response continued to keep Treasury yields near multiyear peaks.
In other market news, shares of Warner Bros Discovery rose 11% to $30.80, marking its largest gain in almost a year. This increase followed reports that Paramount reached an antitrust settlement with 12 state attorneys general, potentially clearing the way for an $81 billion acquisition that would merge two prominent Hollywood studios. The settlement terms are expected to allow Paramount to retain control of cable channels while committing to investments in domestic studios and production. The Trump administration also proposed a $5 billion fund to help Middle Eastern countries rebuild energy infrastructure damaged by the Iran war and reduce their reliance on the Strait of Hormuz for oil and gas transport.
