Closing Bell: Dow Rallies to Record on Iran Diplomacy Hope, MSFT and PLTR Move Higher

U.S. stocks started August with a bang Monday, with major indexes pushing toward record territory on signs of economic growth and hope that the U.S. and Iran can restart negotiations. 

The U.S. benchmark price for crude oil prices fell more than 5% to near $80 per barrel and Treasury yields moved lower, despite conflicting reports about potential diplomacy between the U.S. and Iran. Also bolstering sentiment as earnings season continued was the stronger-than-expected July ISM Manufacturing PMI. It climbed to 55.6, which marks the strongest factory activity in more than four years. 

The Dow Jones Industrial Average ($DJI) rose 1.32% to 53,178.41, a record high. The S&P 500 (SPX) was up 1.48% to 7,600.50, and the Russell 2000 (RUT) advanced 1.73% to 2,981.91. The tech-heavy Nasdaq-100 (/NDX) gained 1.78% to 28,776.80, and the PHLX Semiconductor Sector Index (SOX) was up 1.05% to 11,430.35, as investors continued rotating into growth and AI-related names 

Three Things to Watch from Monday's Market: 

• Warning Signs in the Economic Data? While the ISM Manufacturing Index rose to 55.6 in July, and investors and traders alike welcomed the growth signal, the report also highlighted persistent inflation pressures that could complicate the Federal Reserve's policy path. See Susan Spence Breaks Down the Manufacturing Sector’s Rebound
• Palantir (PLTR) earnings After the Bell: Palantir shares spiked 12% after hours following its much-anticipated earnings report. The company delivered another quarter of mega growth and beat per-share adjusted earnings per share and revenue consensus estimates. The company reported dramatic growth in revenue and strong cash flow.  
• Mega-Cap Tech and AI Continue to Drive Momentum: Amazon (AMZN) surpassed $3 trillion in market capitalization, while Alibaba (BABA) gained more than 4% after unveiling its Qwen3.8-Max AI model. Microsoft (MSFT) shares rose nearly 5%, marking the stock's third session of gains and the best stretch since October 2000, according to reports. ArcelorMittal (MT) expanded its partnership with Microsoft to implement AI tools in its business processes. Separately, Microsoft is raising Xbox prices in the EU and the UK, The Verge reported. See Lisa Martin: Big Tech Earnings & MSFT Role as a Hyperscaler Benchmark

Economic Calendar, Tuesday, Aug. 4 

• 8:30 AM: U.S. Trade Balance (June) 
• 10:00 AM: JOLTS Job Openings (Jun) 
• 10:00 AM: Factory Orders (MoM) (Jun) 

Earnings Calendar, Tuesday 

Premarket: Caterpillar (CAT), McDonald's (MCD), Pfizer (PFE), Merck & Co (MRK), BP (BP), Transdigm (TDG), WW Grainger (GWW), Spotify Technology (SPOT), Cummins (CMI), Archer-Daniels-Midland (ADM), Kimberly-Clark (KMB) 

Postmarket: Advanced Micro Devices (AMD), SpaceX (SPCX), Booking Holdings (BKNG), Arista Networks (ANET), Pinterest (PINS), Amgen (AMGN), Gilead (GILD), Toast (TOST), Suncor Energy (SU), Devon Energy (DVN), Astera Labs (ALAB), DigitalOcean Holdings (DOCN), Ball (BALL) 

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