Stocks up ahead of General Assembly, oil cools

(AWP Alliance News) - Stocks ended higher in New York on Monday as investors look towards several high-profile meetings between US President Donald Trump and world leaders this week at the UN General Assembly in New York.

The Dow Jones Industrial Average closed up 366.19 points, 0.7%, at 52,048.83. The S&P 500 rose 114.20 points, 1.5%, to 7,764.70. The Nasdaq Composite ended up 599.55 points, 2.3%, at 27,122.09.

"At this point, our base-case year-end [S&P 500] target of 8,000 assumes the Fed may deliver an additional quarter-point hike before year-end, that economic growth remains firm, that profit conditions hold to expectations, and that inflation pressures and other macro items described above don't disrupt the apple cart too much. For the index to drift higher than that 8,000 level, investors will likely need to see evidence that next year's outlook for growth and profits is materially strengthening. In addition, we would expect any potential Middle East resolution that pulls the energy premium out of inflation and gives the Fed cover to signal that further rate hikes may not be needed, as conditions that would have to be present to push the S&P 500 meaningfully past our base target. Of course, for stocks to move higher in either scenario, the AI trade will likely need to remain positive, and interest rates will need to stabilize and stop rising," said Ameriprise Financial Chief Market Strategist Anthony Saglimbene.

"If these conditions are not met, oil moves higher rather than lower, growth remains hot enough that the Fed signals it needs to extend the rate hiking cycle beyond what markets currently price, and/or the AI capex engine slows as financing costs rise, we would expect stocks to move lower from here."

US President Donald Trump is preparing for several high-profile meeting this week as the UN General Assembly gathers in New York.

The President has announced meeting with Venezuela's Interim President Delcy Rodriguez, Ukraine's Volodymyr Zelensky, French leader Emmanuel Macron and New York City Mayor Zohran Mamdani.

On Tuesday, Trump, Danish Prime Minister Mette Frederiksen and Greenland's Prime Minister Jens-Frederik Nielsen will sign a security deal for Greenland.

The arrangement will give the US "permanent control" over security for Greenland, Trump said Friday.

Trump will also meet with Chinese leader Xi Jinping as the later embarks on a state visit from Wednesday to Friday. Foreign ministry spokesman Guo Jiakun said Beijing would "work with the US to enrich the substance of the relationship of constructive strategic stability between China and the US...[and] properly manage differences".

The General Assembly take places against the backdrop of the global energy crisis driven by the Iran war. High inflation saw the Federal Reserve and the Bank of Japan hike rates last week, joining the European Central Bank which voted to raise rates a week prior.

A barrel of Brent fetched USD100.11 late Monday, down from USD103.29 on Friday. West Texas Intermediate fell to USD95.43 from USD99.74.

On Saturday, the Yemen's Houthis claimed strikes on Riyadh and Saudi Arabian Oil Co facilities in the kingdom's port city of Yanbu, while President Trump on Sunday threatened Iran that he would 'blow the entire nation up" after Tehran warned of further strikes.

But oil prices fell on hopes for some form of communication between the US and Iran at this week's UN meeting.

US Treasury Secretary Scott Bessent called his meeting with Chinese Vice Premier He Lifeng on Sunday "very successful," ahead of Xi's visit to the US. Bessent said both sides discussed greater communication on artificial intelligence threats.

"What we discussed was setting up a mechanism. So it's going to be called the US-China AI dialogue," he said. "We've agreed to meet again."

The yield on the 10-year US Treasury was at 4.95% late Monday, down from 5.01% on Friday. The 30-year yield fell to 5.28% from 5.33%.

Bond yields remain elevated amid investor scrutiny over US government spending, inflation concerns and record corporate issuances to fund the AI revolution.

Against the dollar, the euro was at USD1.1464, down from USD1.1489 on Friday. Sterling fell to USD1.3367 from USD1.3395. Against the yen, the dollar was at JPY157.44, up from JPY156.75.

Gold fell to USD4,340.20 an ounce from USD4,382.29.

In Europe, the FTSE 100 closed up 0.8% in London. The CAC 40 gained 0.9% in Paris. The DAX 40 rose 1.1% in Frankfurt.

In China, the Shanghai Composite closed up 1.0%. The Hang Seng in Hong Kong gained 1.2%. The S&P/ASX 200 ended slightly higher in Sydney. The Nikkei 225 in Tokyo was closed for Respect for the Aged Day.

On the corporate front, Paramount has reached a settlement with 12 US states that sued to stop the company's historic merger with Warner Bros Discovery.

California attorney general Rob Bonta said the settlement includes a commitment that the merged studio would produce 30 movies in each of the first two years of the deal, and 32 movies in each of the following three years.

At least four of those films must be independent productions, and at least 20% must be blockbusters, Bonta said.

The terms include a financial penalty if Paramount fails to meet the targets.

The deal also requires at least USD300 million more in annual spending on US film production by Paramount and Warner Bros than in 2025.

WBD closed up 11%. Paramount fell 2.9%.

Ozempic- and Wegovy-maker Novo Nordisk on Monday said it aims to launch more than five "multi-blockbusters" by 2030.

The target for pipeline sales in 2035 is above DKK150 billion, or roughly USD23.04 billion, Novo said at a capital markets day in London.

The company is targeting a compound annual growth rate for revenue between 2026 and 2030 "in line with industry peers", among whom it cited Eli Lilly and AstraZeneca.

Novo closed down 8.0% in New York. Lilly and AstraZeneca gained 1.1%.

AbbVie on Monday announced a multi-year partnership with Iambic Therapeutics to use artificial intelligence to accelerate drug discovery across immunology, neuroscience and oncology.

The drugmaker said the collaboration will combine Iambic's AI-driven molecular discovery platform with AbbVie's drug development expertise to identify and develop small molecule therapies.

The companies will pursue programmes with the potential to produce both first-in-class and best-in-class medicines.

AbbVie closed up 0.2%

AI model Gemini, developed by Alphabet's Google, hacked multiple systems through guessing login credentials, the company told AFP on Friday, the latest of such cases which have generated safety concerns from the industry.

The hacks, first reported by the Wall Street Journal, took place in May and were discovered by Google in July.

"In a standard evaluation, the model found public information online and guessed credentials to access websites it thought were part of the test," Heather Adkins, Google's vice president of security engineering, told AFP.

In July, two OpenAI models escaped the closed environment they were meant to stay in, got onto the internet on their own and broke into the internal systems AI platform Hugging Face.

Similar episodes have been reported at Anthropic and China's Moonshot AI Technology Co Ltd.

Alphabet closed up 1.9%

Tuesday's global economic calendar has the Richmond Fed manufacturing index. Financial markets in Japan remain closed until Thursday.

By Aidan Lane, Alliance News reporter

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