The S&P 500 Index ($SPX) (SPY) rose +0.67% on Monday, the Dow Jones Industrial Average ($DOWI) (DIA) rose +0.29%, and the Nasdaq 100 Index ($IUXX) (QQQ) rose +1.09%. December E-mini S&P futures (ESZ26) rose +0.70%, and December E-mini Nasdaq futures (NQZ26) rose +1.09%.
The US stock market rallied Monday as crude oil prices fell -1.7% on some relief after the US and Israel did not launch a military attack over the weekend. Also, top officials from Saudi Arabia, Pakistan, and Turkey met with Iranian leaders in Tehran on Monday to discuss regional security and the possibility of de-escalating hostilities. In conjunction with the meeting, Iranian President Masoud Pezeshkian said that Iran is ready to back “any understanding” that leads to regional unity, and he said Iran is not seeking nuclear weapons.
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Meanwhile, President Trump told Fox News on Sunday that it’s “getting to be decision time” on whether he will make a deal with Iran or “finish it off.” The US is building up military forces in the Middle East into November and is evacuating non-essential embassy personnel in the Gulf region, fueling speculation that the US might launch a new military attack on Iran after next Tuesday’s (Nov 3) US election.
Stocks also saw support from better-than-expected US economic reports and some AI enthusiasm sparked by Anthropic’s IPO filing on Monday.
In some supportive news for stocks, the Sep Chicago Fed National Activity index rose to 0.07 from a revised -0.08 in August, and was stronger than expectations of a decline to -0.10. Also, the Dallas Fed’s Oct manufacturing index rose to 13.4 from 9.8, stronger than expectations for a decline to 8.8.
Markets face a busy week. At its 2-day meeting beginning Tuesday, the FOMC is expected to leave rates unchanged but maintain a hawkish bias. The ECB meets this Thursday, and the Bank of Japan meets this Friday. This is expected to be an important week for the AI theme, with hyper-scalers Alphabet and Microsoft reporting earnings on Wednesday, and Amazon.com reporting on Thursday.
French bond yields fell as weekend demonstrations in France did not involve the large-scale violence and looting seen in previous demonstrations. Also, Moody’s did not downgrade France’s debt rating and left France’s bond rating unchanged at Aa3 with a negative outlook. The French 10-year OAT government bond yield fell -12 bp to 4.90% on Monday, after posting a 24-year high of 5.14% last Thursday.
Brazilian stocks fell sharply after President Luiz Inacio Lula da Silva surprised the markets by winning the weekend Brazilian presidential election for a fourth term. The iShares MSCI Brazil ETF (EWZ) fell more than -20%.
Stocks are supported by the prospect of solid quarterly earnings. According to data compiled by Bloomberg Intelligence, Q3 S&P 500 earnings are expected to climb by +26% from a year earlier, up from a July estimate of 22%. As of last Friday, 120 of the S&P 500 companies have reported results, with 80% beating estimates.
Markets are pricing in an 11% chance of a +25 bp Fed rate hike at the FOMC meeting on Tuesday and Wednesday.
Overseas stock markets closed mixed on Monday. The Euro Stoxx 50 closed up +0.79%. China’s Shanghai Composite closed up +0.19%. Japan's Nikkei-225 Stock Average closed down -0.80%.
Interest Rates
December 10-year T-notes (ZNZ6) fell -1.5 ticks. The 10-year T-note yield fell -0.8 bp to 4.986%. T-note prices were supported by Monday’s sell-off in crude oil prices and a -0.7 bp decline in the 10-year breakeven inflation expectations rate to 2.349%.
On the bearish side, the T-note market remains defensive ahead of the FOMC meeting on Tuesday and Wednesday, which is not expected to produce a rate hike but is likely to produce hawkish commentary about the likely need for additional rate hikes to address above-target inflation. The markets are pricing the odds at 91% for a +25 bp rate hike at the FOMC’s next meeting on December 9.
European government bond yields were mixed on Monday. The 10-year German bund yield rose +2.1 bp to 3.367%. The 10-year UK gilt yield fell -1.2 bp to 5.344%.
Markets are pricing in a 4% chance of a +25 bp ECB rate hike at this Thursday’s ECB meeting.
US Stock Movers
The Magnificent Seven closed mixed on Monday. Meta (META) fell -2% after announcing the sale of up to $95 billion of common and preferred stock to support its AI plans. Tesla (TSLA) rallied more than +5% after Barclays upgraded the stock to overweight from equal-weight, citing the possibility of a buyout by SpaceX. Microsoft (MSFT) rose +1.5% after announcing plans to offer buyouts to 60,000 workers in a new cost-cutting initiative.
Chip stocks rallied across the board, with the iShares Semiconductor ETF (SOXX) rising +2.9% after last week’s overall -3.2% sell-off. Arm Holdings (ARM) rallied more than +6%. Texas Instruments (TXN), NXP Semiconductors (NXPI), Analog Devices (ADI), and Intel (INTC) rallied more than +4%.
Anthropic officially filed for its IPO on Nasdaq on Monday, with a ticker symbol of ANT. The company reported an $81 billion net loss in the first half of 2026. Anthropic officials hope to match or exceed SpaceX’s blockbuster IPO that raised $86 billion.
SpaceX (SPCX) fell -0.4% after news that the company signed a $40 billion chip-financing lease with Apollo Global Management to pay for the chips needed to fulfill its AI ambitions. SpaceX said in a statement released Monday that, “This lease diversifies our funding sources and addresses a notable portion of the funding required to deliver on our growth plans.” SpaceX also said it is seeing “less than one year payback periods” on its AI investments.
In a blockbuster natural gas deal, Range Resources (RRC) rallied more than +17% on news EQT (EQT) will buy the company in an all-stock transaction. EQT (EQT), the largest independent US natural gas producer, fell -1.4% on the news. Range Resources is a pioneer of the Appalachian shale natural gas boom.
Surgery Partners (SGRY) rallied more than +40% after news that US-based healthcare provider Bon Secours Mercy Health will acquire it for an enterprise value of $57 billion. Surgery Partners owns and operates one of the largest networks of short-stay surgical hospitals and ambulatory surgery centers (ASCs) in the United States.
Coinbase (COIN) fell -2.9% after Bernstein cut its price target to $250 from $330 on lower-than-expected crypto trading volumes. Other crypto stocks were mixed, with Bitcoin falling -2.0%. Galaxy (GLXY) rallied more than +7%, while Iren Limited (IREN) rose +1.9%. By contrast, Circle Internet (CRCL) fell -7.1%, and Bitmine Immersion Technologies (BMNR) fell -6.5%.
Earnings Reports (10/27/2026)
Coca-Cola Co/The (KO), CenterPoint Energy Inc (CNP), IQVIA Holdings Inc (IQV), Central BanCo Inc (CBC), Boeing Co/The (BA), SoFi Technologies Inc (SOFI), Sherwin-Williams Co/The (SHW), Johnson Controls International (JCI), Lincoln Electric Holdings Inc (LECO), Travel + Leisure Co (TNL), HCA Healthcare Inc (HCA), Hilton Worldwide Holdings Inc (HLT), Corning Inc (GLW), Ecolab Inc (ECL), Watsco Inc (WSO), PayPal Holdings Inc (PYPL), Applied Industrial Technologie (AIT), Millrose Properties Inc (MRP), Royal Caribbean Cruises Ltd (RCL), Freeport-McMoRan Inc (FCX), PACCAR Inc (PCAR), Innio NV (INIO), Euronet Worldwide Inc (EEFT), Centene Corp (CNC), Armstrong World Industries Inc (AWI), CMS Energy Corp (CMS), Smithfield Foods Inc (SFD), Hubbell Inc (HUBB), Galaxy Digital Inc (GLXY), United Parcel Service Inc (UPS), Repligen Corp (RGEN), Pentair PLC (PNR), Xylem Inc/NY (XYL), BioMarin Pharmaceutical Inc (BMRN), American Tower Corp (AMT), TransUnion (TRU), Invesco Ltd (IVZ), Hartford Insurance Group Inc/T (HIG), Ensign Group Inc/The (ENSG), S&P Global Inc (SPGI), Illinois Tool Works Inc (ITW), Arch Capital Group Ltd (ACGL), Sensata Technologies Holding P (ST), Landstar System Inc (LSTR), NOV Inc (NOV), BXP Inc (BXP), Chemed Corp (CHE), Robinhood Markets Inc (HOOD), CoStar Group Inc (CSGP), STAG Industrial Inc (STAG), Ventas Inc (VTR), Waste Management Inc (WM), PPG Industries Inc (PPG), Universal Health Services Inc (UHS), Manhattan Associates Inc (MANH), EQT Corp (EQT), ExlService Holdings Inc (EXLS), F5 Inc (FFIV), Visa Inc (V), Caesars Entertainment Inc (CZR), Extra Space Storage Inc (EXR), FirstEnergy Corp (FE), Seagate Technology Holdings PL (STX), Expand Energy Corp (EXE), Crane Co (CR), Enphase Energy Inc (ENPH), Range Resources Corp (RRC), WP Carey Inc (WPC), NXP Semiconductors NV (NXPI), Essex Property Trust Inc (ESS), LPL Financial Holdings Inc (LPLA), RenaissanceRe Holdings Ltd (RNR), ONEOK Inc (OKE), Teradyne Inc (TER), Baker Hughes Co (BKR).
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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