US stocks opened higher on Monday as Wall Street attempted to rebound from a difficult week, while oil prices retreated after a sharp rally driven by escalating tensions in the Middle East.
The Dow Jones Industrial Average climbed 305 points, or 0.66%, while the S&P 500 gained 0.9%.
The Nasdaq Composite advanced 1.15% as investors assessed developments related to the Iran conflict and its potential impact on global energy markets.
The gains came after the S&P 500 recorded its third consecutive losing week and ended Friday at its lowest level of the year.
Oil retreats after surge above $100
Oil prices eased on Monday following a sharp rally last week that pushed Brent crude above $100 per barrel for the first time since 2022.
Crude prices had surged as shipping through the Strait of Hormuz, one of the world’s most important oil transit routes, was effectively halted amid the ongoing conflict in the region.
In Monday trading, West Texas Intermediate crude fell about 3% to just below $95 a barrel after briefly trading near $100.
Brent crude slipped more than 1.2% to around $101 a barrel.
The pullback came after Treasury Secretary Scott Bessent said the United States was allowing Iranian oil shipments to move through the strait.
“The Iranian ships have been getting out already, and we’ve let that happen to supply the rest of the world,” Bessent told in a CNBC interview.
According to officials, tanker traffic through the Strait has dropped sharply as Iran attacks commercial vessels in the Persian Gulf.
Despite the disruption, the country has continued exporting oil through the narrow route.
Iran exports roughly 1.5 million barrels of oil per day.
Oil prices were also pressured by a report from the Wall Street Journal stating that the United States is preparing to announce a coalition of countries to escort ships through the Strait.
Meanwhile, President Donald Trump ordered strikes on Iranian military assets located on Kharg Island on Friday.
Although the attack did not affect oil infrastructure, Trump said the United States would consider targeting those facilities if Iran continues to block the shipping route.
Technology and AI-related stocks move higher
Several technology and artificial intelligence-linked companies led the market’s gains.
Shares of Meta rose about 2.4% after a report — which the company called “speculative” — suggested the social media giant was preparing layoffs affecting more than 20% of its workforce.
The cuts are reportedly tied to the company’s AI strategy.
Nvidia also gained more than 2% ahead of its GTC conference, which began Monday.
AI infrastructure firm Nebius Group surged 15% after announcing a deal with Meta.
Under the agreement, the company said it would “provide $12 billion of dedicated capacity across multiple locations.”
Chipmaker Micron Technology rose 6% after announcing plans to build a second manufacturing facility in Taiwan to expand supply of advanced DRAM products.
Crypto-related stocks also climbed as bitcoin moved higher.
Mara Holdings and Strategy gained about 4% each, while Circle Internet Group advanced 5.4%.
Elsewhere, National Storage Affiliates surged more than 28% after agreeing to be acquired by Public Storage in an all-stock deal valued at roughly $10.5 billion.
The transaction is expected to close in the third quarter.
Markets remain resilient despite geopolitical tensions
Despite ongoing geopolitical uncertainty, the broader stock market has shown resilience.
The S&P 500 remains about 5% below its record high reached earlier this year.
Analysts say optimistic earnings expectations are helping support the market.
“The apparent resilience in the S&P 500 is attributable to the increasing bullishness of industry analysts’ consensus estimates for earnings per share in 2026 and 2027,” Ed Yardeni, president of Yardeni Research, wrote. “Apparently, they did not get the memo about the possible negative consequences of a protracted war and closure of the Strait.”
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