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Wall Street closed higher on Monday, pulled up by consumer and industrial stocks. Investors brushed aside concerns about the recent steep fall in precious metals and Bitcoin to show confidence in artificial intelligence (AI)-related chipmaker stocks and the small-cap sector. All three benchmark indexes finished in the green.
How Did the Benchmarks Perform?
The Dow Jones Industrial Average (DJI) gained 1.1%, or 515.19 points, to close at 49,407.66. Twenty-three components of the 30-stock index ended in positive territory, while seven ended in the negative.
The tech-heavy Nasdaq Composite added 130.29 points, or 0.6%, to close at 23,592.11.
The S&P 500 rose 0.5%, or 37.41 points, to close at 6,976.44. Eight of the 11 broad sectors of the benchmark index closed in the green. The Consumer Staples Select Sector SPDR (XLP), the Industrials Select Sector SPDR (XLI) and the Financials Select Sector SPDR (XLF) advanced 1.6%, 1.3% and 1%, respectively, while the Energy Select Sector SPDR (XLE) lost 2%.
The fear gauge CBOE Volatility Index (VIX) decreased 6.3% to 16.34. A total of 20.1 billion shares were traded on Monday, higher than the last 20-session average of 19.4 billion. Advancers outnumbered decliners by a 1.4-to-1 ratio on the S&P 500.
AI Optimism and Small-Cap Rotation Lift Wall Street
Wall Street benchmarks advanced on Feb. 2, 2026, as renewed confidence in AI drove strong gains in chipmakers and other AI-linked companies, lifting broader market sentiment. Investors leaned into semiconductors and infrastructure plays on expectations of sustained enterprise spending, accelerating AI adoption and resilient earnings visibility among industry leaders. The rally was reinforced by easing concerns around near-term monetary policy, which supported risk appetite and boosted growth-oriented stocks.
Small-cap shares rose sharply as well, reflecting a rotation into domestically focused companies that stand to benefit from improving financing conditions and steadier U.S. demand. Lower Treasury yields and a softer dollar helped ease pressure on balance sheets, while bargain hunting followed recent underperformance in the segment. Together, optimism around AI-led growth and a broadening market rally into small caps underpinned the day’s gains. The Russell 2000 index, which showcases small-cap stocks, jumped around 1% in the session and is up more than 6% year to date. Chipmakers gaining from strong AI-related demand for their components also rose.
Oil prices fell sharply on Monday after U.S. President Donald Trump said Iran was “seriously talking” with Washington, signaling a possible de-escalation of tensions with the OPEC member. The prospect of renewed nuclear talks reduced geopolitical risk premiums that had supported crude through January. Prices were also pressured by a stronger dollar and milder weather forecasts, which weighed on demand expectations.
Brent crude dropped $3.02, or 4.4%, to settle at $66.30/barrel, while WTI crude slid $3.07, or 4.7%, to $62.14/barrel. Energy prices weighed down on Wall Street.
Economic Data
Per the Institute for Supply Management, ISM Manufacturing PMI for January came in at 52.6, falling from 47.9 in December.
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Stock Market News for Feb 3, 2026
Wall Street closed higher on Monday, pulled up by consumer and industrial stocks. Investors brushed aside concerns about the recent steep fall in precious metals and Bitcoin to show confidence in artificial intelligence (AI)-related chipmaker stocks and the small-cap sector. All three benchmark indexes finished in the green.
How Did the Benchmarks Perform?
The Dow Jones Industrial Average (DJI) gained 1.1%, or 515.19 points, to close at 49,407.66. Twenty-three components of the 30-stock index ended in positive territory, while seven ended in the negative.
The tech-heavy Nasdaq Composite added 130.29 points, or 0.6%, to close at 23,592.11.
The S&P 500 rose 0.5%, or 37.41 points, to close at 6,976.44. Eight of the 11 broad sectors of the benchmark index closed in the green. The Consumer Staples Select Sector SPDR (XLP), the Industrials Select Sector SPDR (XLI) and the Financials Select Sector SPDR (XLF) advanced 1.6%, 1.3% and 1%, respectively, while the Energy Select Sector SPDR (XLE) lost 2%.
The fear gauge CBOE Volatility Index (VIX) decreased 6.3% to 16.34. A total of 20.1 billion shares were traded on Monday, higher than the last 20-session average of 19.4 billion. Advancers outnumbered decliners by a 1.4-to-1 ratio on the S&P 500.
AI Optimism and Small-Cap Rotation Lift Wall Street
Wall Street benchmarks advanced on Feb. 2, 2026, as renewed confidence in AI drove strong gains in chipmakers and other AI-linked companies, lifting broader market sentiment. Investors leaned into semiconductors and infrastructure plays on expectations of sustained enterprise spending, accelerating AI adoption and resilient earnings visibility among industry leaders. The rally was reinforced by easing concerns around near-term monetary policy, which supported risk appetite and boosted growth-oriented stocks.
Small-cap shares rose sharply as well, reflecting a rotation into domestically focused companies that stand to benefit from improving financing conditions and steadier U.S. demand. Lower Treasury yields and a softer dollar helped ease pressure on balance sheets, while bargain hunting followed recent underperformance in the segment. Together, optimism around AI-led growth and a broadening market rally into small caps underpinned the day’s gains. The Russell 2000 index, which showcases small-cap stocks, jumped around 1% in the session and is up more than 6% year to date. Chipmakers gaining from strong AI-related demand for their components also rose.
Consequently, shares of Western Digital Corporation (WDC - Free Report) and Advanced Micro Devices, Inc. (AMD - Free Report) jumped 8% and 4%, respectively. While AMD carries a Zacks Rank #2 (Buy), WDC sports a #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Oil Slides on Iran-U.S. Diplomacy Signals
Oil prices fell sharply on Monday after U.S. President Donald Trump said Iran was “seriously talking” with Washington, signaling a possible de-escalation of tensions with the OPEC member. The prospect of renewed nuclear talks reduced geopolitical risk premiums that had supported crude through January. Prices were also pressured by a stronger dollar and milder weather forecasts, which weighed on demand expectations.
Brent crude dropped $3.02, or 4.4%, to settle at $66.30/barrel, while WTI crude slid $3.07, or 4.7%, to $62.14/barrel. Energy prices weighed down on Wall Street.
Economic Data
Per the Institute for Supply Management, ISM Manufacturing PMI for January came in at 52.6, falling from 47.9 in December.