Wall Street Posts Best Day Since April as Selloff Reverses

Wall Street's Dow, S&P 500 and Nasdaq all surged more than 2% on Monday as tumbling oil prices eased inflation fears, while the FTSE 100 climbed over 1% on firmer gold prices. Nvidia fell as its board investigates whether chief executive Jensen Huang was targeted by a foreign intelligence operation. Markets now turn to Tuesday's US inflation data, which could shape the Federal Reserve's December rate decision.

Equities

The FTSE 100 climbed 1.02% to 10,782.87 points on Monday, while the FTSE 250 added 0.8%, as lower oil prices eased inflation concerns and firmer gold prices lifted mining stocks. Precious metals producers led the gainers, with Fresnillo, Antofagasta and Anglo American among the biggest risers. Energy stocks lagged as Brent crude tumbled, weighing on the index's oil producers.

Kainos Group dropped 12.4% on the FTSE 250, the worst performer on the midcap index, after the software provider kept its half-year guidance unchanged. Georgia's TBC Bank, also London-listed, rose after posting a higher third-quarter profit. The Bank of England, which raised rates to 4% last week, has said a further increase is likely if the US-Iran conflict continues.

On Wall Street, the Dow Jones Industrial Average rose 2.15% to 52,389.75, the S&P 500 gained 2.35% to 7,549.94 — its biggest one-day jump since April — and the Nasdaq Composite surged 2.74% to 25,253.14, its best day in over four months. The rally reversed last week's steep selloff, which had been driven by worries that a Democrat-controlled Congress could tighten regulation on the AI industry.

Nvidia fell as the chipmaker's board investigates whether chief executive Jensen Huang was the target of a foreign intelligence operation, following a media report questioning his conduct. Shares dropped to their lowest level since April 7, with the stock due to report quarterly earnings next week. It was the lone decliner among major chip stocks, which otherwise rebounded sharply from last week's rout.

Apple closed at a record high. This week's earnings from CoreWeave, Applied Materials and Cisco Systems will test investor confidence in the profitability of the AI buildout. Details of Anthropic's blockbuster initial public offering, including plans to raise nearly $70 billion, were briefly circulated to banks before being withdrawn late on Monday, with the AI company due to launch its roadshow on Tuesday.

Forex & Commodities

The dollar eased broadly on Monday as investors rotated into riskier assets, before steadying in early Tuesday trading ahead of the day's US inflation data. The euro rose 0.7% on Monday to $1.1220, while sterling held near $1.344, supported since the Bank of England's rate hike last week.

The Australian dollar gained almost 1% to $0.692 and the New Zealand dollar advanced to $0.563, the kiwi boosted by an election result that left the incumbent coalition in power. Japan's yen hovered near 158 per dollar, still the best-performing G10 currency against the dollar over the past six months after heavy official intervention.

US Treasury yields rose ahead of Tuesday's inflation report, with markets pricing an 84% chance of a Federal Reserve rate increase in December after Friday's stronger-than-expected October jobs data. Britain's jobs market cooled in October, though starting salaries for permanent roles rose at a faster pace, a survey of recruiters showed.

Gold eased 0.4% to around $4,124 an ounce on Tuesday, giving back some of Monday's rally as investors took profits ahead of the inflation data. Silver slipped slightly, while platinum and palladium were little changed.

Brent crude tumbled almost 6% on Monday to settle at $92.57 a barrel, extending losses to around $91.56 — its lowest level since early September — on Tuesday. The slide came after President Trump said he was unlikely to order fresh strikes on Iran following appeals from regional governments including Qatar, while US crude fell a similar margin to settle at $86.85.