U.S. stocks rebounded Monday, recovering from Friday’s steep losses, as an initial spike in oil prices on renewed Iran-Israel fighting subsided after Iran said it had ended its strikes against Israel. The Nasdaq Composite gained more than 1% in early trading, while the S&P 500 rose about 0.5% and the Dow Jones Industrial Average was roughly flat around 50,866.78, according to Federal Reserve data.
The moves mark a sharp turnaround from Friday, when a hotter-than-expected May jobs report and a pullback in the AI trade sent the Nasdaq tumbling more than 4%. The selloff initially looked set to continue when futures started trading Sunday, following a weekend of renewed fighting between Iran and Israel, the Wall Street Journal reported. But stock futures climbed after Iran said it had ended its strikes, and the S&P 500 — which stood at 7,383.74 as of the prior session — pared its losses.
Some of the hardest-hit stocks last week, namely AI-related names, are among those rising the most Monday. The PHLX Semiconductor Index was up 6.3% in early trading, signaling a rebound in tech sentiment. An initial surge in oil prices eased after the Iranian announcement, while Treasury yields also trimmed earlier gains.
Investors are now looking ahead to the release of May inflation data on Wednesday, which should offer clues on whether the Federal Reserve will raise interest rates this year. The May jobs report, which showed the U.S. added 172,000 jobs, exceeding expectations, contributed to the view that the economy remains strong enough to keep the central bank on a tightening path. Also on the docket this week: SpaceX’s long-awaited initial public offering.