Wall Street rallies within 0.4% of its record after oil prices and bond yields ease

NEW YORK (AP) — Wall Street climbed to the edge of its all-time high on Monday, and stocks rallied worldwide after oil prices and yields in the bond market surrendered their market-rattling gains from last week.

The S&P 500 jumped 1.5% and pulled within 0.4% of its record set last month. The Dow Jones Industrial Average added 366 points, or 0.7%, and the Nasdaq composite leaped 2.3% to its own all-time high as chip stocks and other companies in the artificial-intelligence industry led the way.

Stocks got help from the price for a barrel of Brent oil falling 3.4% to $100.34. While that’s still much higher than its roughly $72 price from earlier this summer, it’s down from the nearly $110 it touched last week.

Oil prices have been swinging up and down as some crude from the Middle East is able to sail through the Strait of Hormuz to get to customers, though nowhere near as much as the industry would like because of the war with Iran.

With big U.S. companies continuing to deliver strong growth in profits that support their stock prices, Morgan Stanley’s Michael Wilson says another leg higher in prices for oil, gasoline and other refined products is the main near-term risk he sees that could keep the U.S. stock market from rising to his forecasted target for the year’s end.

The average price for a gallon of regular gasoline across the United States has already climbed to nearly $4.48, according to AAA. That’s up from less than $4.32 just a week earlier and from $3.18 a year ago.

Monday’s pullback in oil prices helped lower the pressure coming from the bond market. The yield on the 10-year Treasury eased to 4.95% from 5.01% late Friday after crossing above the 5% threshold last week for the first time since 2023.