S&P 500 Rose 2.35% as Oil Fell, but Treasury Yields Held Steady

The S&P 500 closed at 7,549.94 on Monday, November 9, up 2.35%. The Nasdaq 100 rose 3.40% and the Russell 2000 3.17%; according to AP, it was the S&P 500's best day since April.

The rally stood on two legs. Brent fell 4.7% to $93.73 in the afternoon, and AI stocks that were dumped last Thursday were bought back.

The VIX volatility index fell 21.9% to 20.02. Advancers outnumbered decliners by more than three to one: 4,221 against 1,240.

Trump's Iran Remarks Pushed Oil Lower

Trump told CNN that a resumption of military action against Iran was "highly unlikely" if negotiations progress. Qatar's prime minister was in Washington the same day to meet Trump and Vance.

Brent was above $112 at the start of the month, so Monday's level sits about 16% lower. The war that began in late February and attacks on ships in the Strait of Hormuz had left oil roughly 70% higher for the year as of November 4.

The negotiating picture is less clear. Secretary of State Rubio said the talks were not on the verge of a breakthrough, and Iran demands that the U.S. lift its naval blockade of Iranian ports.

AI Stocks Were Bought Back, Nvidia Was Not

On Thursday the S&P 500 fell 4.4% as calls for a data center ban hit chip stocks (that day's story). On Monday part of that selloff reversed, and fuel-sensitive sectors joined the rally.

AMD rose 12.9%, recovering part of last week's 11% loss. Coherent was up 18% at midday, while United Airlines gained 5.9% and Carnival 4%.

Nvidia instead closed down 4.27% at $178.67. The board's investigation into CEO Jensen Huang (details) weighed on the stock, yet the Nasdaq 100 still rose.

The chart below shows the past month of SPY, the fund that tracks the S&P 500; Thursday's drop and Monday's rebound sit in the same window.

Oil Fell, Yields Did Not

The stock market read the oil drop as inflation relief. The bond market did not.

The 10-year yield rose from 4.86% on Friday to 4.88%. Market pricing cited by Newsquawk put the odds of a December Fed hike at 79% on Monday morning, versus about 77% after the November 6 jobs report.

If news does not move rates, the market does not see it as binding on the Fed. The reason lies in how inflation is measured.

The Fed's case for a hike is not gasoline. Core inflation rose 0.3% month over month in September, and October payrolls grew by 165,000, three times expectations.

Oil can pull the headline down without touching either of those numbers. Yields holding steady is consistent with that structure; see our rates and bonds guide for more.

What It Means for Investors

• The market priced the oil drop into stocks and fuel-heavy sectors, but did not price the Fed dropping its December hike.
• Fuel-heavy companies such as United and Carnival gain directly from cheaper oil; Nvidia's direction comes from the probe, not rates.
• If monthly core CPI on Tuesday beats the Cleveland Fed's 0.21% nowcast and tops 0.25%, hike pricing strengthens.
• The risk to this view is a collapse in Iran talks; anything sending Brent back toward $112 reverses Monday's math.

Index, oil and yield data come from AP's closing story published by BNN Bloomberg and Yahoo Finance's closing screen. Stock moves and market breadth come from TheStreet's live blog. Fed pricing comes from Newsquawk's November 9 morning note. Inflation nowcasts are Cleveland Fed figures compiled by BYDFi. The gasoline weight is an approximation derived from September data. Coherent's gain is a midday figure; its close could not be verified.