U.S. stocks rose Monday and recovered some of their losses from a rare losing week. The S&P 500 climbed 1.2% and broke a five-day losing streak. It was coming off just its second losing week in the last 13. The Dow Jones Industrial Average added 306 points, or 0.6%, and the Nasdaq composite rallied 2.1%.
The price for a barrel of Brent crude, the international standard, climbed 1.8% to $73.91, pulling back above where it was before the war with Iran began. Benchmark U.S. crude for August delivery rose 2.2% to settle at $70.75 per barrel.
Following attacks across the Persian Gulf over the weekend, the United States and Iran on Monday separately announced they will send delegations to Qatar this week, though Tehran insisted it has not agreed to meet with the United States at any level.
The hope is that an end to the war with Iran will give oil tankers full access again to the Strait of Hormuz, allowing them to exit the Persian Gulf and deliver crude to customers worldwide. That would help lower the price of oil whose jumps because of the war have sent a punishing wave of inflation around the world.
AI-related stocks rallied after Samsung Electronics and SK Hynix announced plans to invest about $518 billion in a new chipmaking hub in South Korea to meet growing AI demand. Applied Materials jumped 10.8%, extending its year-to-date gain to over 170%, while Nvidia rose 1.3%, continuing to benefit from its dominant position as Wall Street's most valuable company. SpaceX climbed 7.2% after its recent Nasdaq debut, with the company set to join the Nasdaq 100 index on July 7.
Despite the latest gains, AI stocks have remained volatile amid concerns that future earnings may not justify their sharp share-price increases. Outside the AI sector, Comcast gained 4.5% after announcing plans to separate its NBCUniversal media and Sky businesses from its broadband and wireless operations. Verizon Communications fell 5.2% after agreeing to pay $625 million for a joint venture with subsidiaries of BT Group.
Higher interest rates can keep a lid on inflation, but they also slow the economy and hurt prices for all kinds of investments. High yields worldwide have been rattling investors after oil prices burst above $100 per barrel because of the war. The yield on the 10-year Treasury edged down to 4.37% from 4.38% late Friday and from 4.56% early this month.
In stock markets abroad, indexes dipped modestly in Europe following mixed performances in Asia. Stocks jumped 1.6% in Hong Kong and 1.2% in Shanghai for two of the world's biggest gains while South Korea's Kospi slipped 0.2%.
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