US stocks surged overnight, reversing steep losses from the prior session. The Dow Jones Industrial Average climbed 585 points, or 1.34%, to close at 44,173. The S&P 500 rose 1.5% to 6,330, snapping a four-day losing streak, while the Nasdaq Composite jumped 2% to 21,053.
The rally follows Friday’s sharp declines, triggered by a weaker-than-expected US jobs report and a surprise escalation in tariffs. President Trump fired the head of the Bureau of Labor Statistics after the data release and signed an executive order raising import duties on dozens of countries, with new rates between 10% and 41%.
Trade talks and earnings on watch
With little major economic data expected this week, investor attention turns to ongoing trade talks between the US and China. Senior officials met last week in Stockholm, and Treasury Secretary Scott Bessent said there were encouraging signs of progress.
On the corporate front, earnings season continues. Palantir is due to report after the close, while AMD will follow on Tuesday.
Despite Monday’s rally, caution remains. August has historically been a volatile month for markets, often the weakest for the Dow, and among the worst for the S&P 500 and Nasdaq.
Australian shares set for strong open
The Australian sharemarket is poised to open higher, with the SPI 200 futures up 86 points, or 1%, to 8,701.
Today’s key local data release is the June household spending indicator, due at 11:30am AEST. Economists expect a 0.9% monthly rise, which would lift annual growth to 5%. NAB says this would signal improved momentum heading into the second half of the year and support a modestly stronger GDP profile.
Credit Corp Group is also due to report results.
