Market Rebound Regains Momentum as Major Averages Return Closer to Record Highs

The stock market staged an across-the-board rally on Monday, lifting the major averages back toward their record levels amid a blend of trade optimism, easing macro concerns, and upbeat corporate headlines.

The S&P 500 (+1.1%), Nasdaq Composite (+1.4%), and Dow Jones Industrial Average (+1.1%) all closed just below their all-time highs, effectively erasing the losses from earlier this month. Small- and mid-cap stocks joined the move, with the Russell 2000 (+2.0%) and S&P Mid Cap 400 (+1.2%) both advancing on broad-based strength.

Nine of the eleven S&P 500 sectors finished in positive territory, each posting gains of at least 1%.

Technology led early trading, supported by renewed enthusiasm around semiconductors. The PHLX Semiconductor Index rose 1.6% as Advanced Micro Devices (AMD) jumped 3.2% to a new record high and Super Micro Computer (SMCI) surged 5.5%. Apple (AAPL) added nearly 4% after reports of strong iPhone 17 sales in both the U.S. and China. The stock was upgraded to Buy by Loop Capital and added to Evercore ISI’s Tactical Outperform list, helping the tech sector close 1.1% higher.

Financials also had a standout session, climbing 1.2%. Robinhood Markets (HOOD) gained more than 4% amid reports that major institutional investors had raised their positions, while regional banks rebounded strongly from last week’s concerns over credit quality. Zions Bancorp (ZION) rallied nearly 5% ahead of earnings, and the KBW Regional Bank ETF added 2.5%.

The best-performing group of the day was communication services (+1.5%), lifted by gains in The Trade Desk (+5.0%), Netflix (+3.3%), Meta Platforms (+2.1%), and Alphabet (+1.3%). The Vanguard Mega Cap Growth ETF rose 1.6%, highlighting the renewed leadership of large-cap growth stocks.

Defensive sectors such as consumer staples and utilities were the only decliners, each slipping 0.1%.

On the macro front, investors found encouragement in comments from White House Economic Advisor Kevin Hassett, who suggested the government shutdown could end later this week. Meanwhile, trade optimism gained momentum after President Trump signaled progress with China, saying he expects a “fair deal” following talks in South Korea and confirming plans to visit Beijing in early 2026.

While the shutdown delayed official economic data releases, expectations for additional Fed rate cuts remain intact ahead of the postponed September CPI report.

With the major indices hovering near all-time highs once again, investor sentiment appears firmly anchored in the belief that the earnings outlook remains resilient — a sign that confidence in both corporate fundamentals and the broader economy continues to hold.

Our FTinvest 11 model portfolio resumed its upward trajectory on Monday, climbing 0.91% to close at 841.96, marking a confident start to the week after last Friday’s steady finish. The advance reflected renewed strength across most components of the portfolio as the market’s tone turned distinctly risk-on, buoyed by optimism surrounding trade developments and steady rate cut expectations.

From the opening bell, buying interest was broad but deliberate, with investors steadily adding exposure after recent consolidation. By the afternoon session, FTinvest 11 held comfortably in positive territory, mirroring the strength seen across the S&P 500 and Nasdaq Composite. The index’s performance demonstrated its balance between growth-oriented and defensive holdings, capturing the upside of the day’s rally while maintaining its characteristic stability.