Wall Street Rallies on Tech Gains Amid Middle East Uncertainty
Wall Street finished sharply higher on Monday, driven by gains in AI-related stocks. The Dow Jones Industrial Average rose 387.94 points, or 0.83%, to 46,946.41, while the S&P 500 gained 69.92 points, or 1.05%, to 6,702.18. The Nasdaq Composite advanced 268.82 points, or 1.22%, to 22,374.18.
Tech Sector Leads Gains
The technology sector spearheaded the market’s advance, with Meta Platforms experiencing a significant jump after Reuters reported the company is preparing for potential workforce reductions. According to the report, Meta plans to shrink its workforce by at least 20% to offset costs associated with artificial intelligence infrastructure investments and prepare for increased efficiency through AI-assisted workers. [Reuters]
Nvidia similarly climbed following CEO Jensen Huang’s announcement of modern components at the chipmaker’s annual developer conference. Taiwan’s Foxconn, a manufacturer of AI servers utilizing Nvidia chips, issued a strong quarterly revenue forecast. [Seeking Alpha]
Further bolstering the tech sector, Tesla rose after CEO Elon Musk announced the upcoming launch of the company’s Terafab project for AI chip production. Micron Technology also saw gains after announcing plans for a second manufacturing facility in Taiwan.
Oil Prices and Middle East Conflict
A modest decline in crude oil prices provided additional support to the market. The U.S. Signaled it would not object to the movement of Iranian, Indian, and Chinese ships through the Strait of Hormuz, contributing to a sense of stability. [Seeking Alpha] Terry Sandven, chief equity strategist at U.S. Bank Wealth Management, noted that this development was “a positive for global economic stability.” However, Sandven cautioned that “the path forward is filled with twists and turns…There’s lack of visibility when the conflict is likely to end.”
Federal Reserve and Interest Rates
Despite the positive market sentiment, concerns remain regarding potential impacts from higher energy prices on central bank meetings globally. The Federal Reserve is widely expected to maintain interest rates at their current level at the conclusion of its two-day meeting on Wednesday. Traders have adjusted their expectations, pushing back the anticipated timing of a potential 25-basis-point interest rate cut to beyond October, compared to previous expectations of a cut in July. [Seeking Alpha]
James McCann, senior economist at Edward Jones, suggested that signals from the Fed meeting should be viewed with caution, citing the potential for fluctuations in oil prices and the possibility that market participants may discount Chair Powell’s statements given it may be one of his last meetings in his term.
Other Market Movers
The CBOE volatility index decreased, and the rate-sensitive Russell 2000 index experienced gains. Despite recent declines over the past three weeks, U.S. Equities have outperformed global peers, benefiting from a rebound in technology stocks and the country’s position as a net oil exporter. However, the S&P 500 remains down approximately 2% year-to-date in 2026.
February industrial production increased by 0.2%, slightly exceeding expectations of a 0.1% rise. Travel stocks, including Delta Air Lines and Norwegian Cruise Line Holdings, also benefited from lower oil prices. Crypto stock Strategy Inc climbed as bitcoin rallied around 3%. Discount retailer Dollar Tree rose after signaling potential benefits from favorable tariffs.
Meta Pauses Persian Gulf Cable Project
Amidst the ongoing Middle East conflict, Meta Platforms has paused function on a portion of its project to expand internet service across Africa via a cable in the Persian Gulf. [MSN]