Equities rallied across regions on Monday after a sharp drop in oil prices eased inflation worries. MSCI's world gauge rose 2.16 percent to 1,108.96, and Europe's STOXX 600 gained 1.26 percent, Reuters reported. European banks led that region, helped by dealmaking at Credit Agricole and Banco BPM and by UniCredit's results, according to Reuters.

Wall Street did most of the lifting. The Dow Jones Industrial Average rose 1,104.02 points, or 2.15 percent, to 52,389.75. The S&P 500 gained 173.08 points, or 2.35 percent, to 7,549.94. The Nasdaq Composite climbed 673.71 points, or 2.74 percent, to 25,253.14, according to CNBC and AP.

It was the S&P 500's best day since April 8, when it gained 2.51 percent, CNBC reported. The Dow is now above its Election Day close. The S&P 500 and the Nasdaq remain slightly below theirs, according to CNBC.

Oil and chips

Brent crude fell more than 5 percent after President Donald Trump said fresh attacks on Iran were unlikely while talks progress, Reuters reported. Lower oil prices eased inflation concerns.

The S&P 500 rebounded from its biggest weekly drop since April 2025. Reuters attributed last week's selloff to the U.S. midterm elections and to worries about more regulation of artificial intelligence and data centers.

Chip stocks drove much of the recovery. The semiconductor index rose 6.9 percent after plunging more than 12 percent last week, according to Reuters. Nvidia was the only decliner in the index. It fell 4.2 percent to its lowest close since April 7, Reuters reported, as investors questioned Chief Executive Jensen Huang's future after the board's internal investigation into whether a foreign intelligence effort had targeted him.

"We have seen a very steep and exaggerated selloff in the market," Adam Sarhan, chief executive of 50 Park Investments, told Reuters. "Whenever the market gets that stretched to the downside, history has shown us usually it's a good buying opportunity in the short term."

Bonds

The 10-year Treasury yield closed at 4.863 percent, up 0.004 percentage point, according to Tradeweb data at 3 p.m. ET reported by Dow Jones via Morningstar. By 5:25 a.m. ET on Tuesday, it was at 4.894 percent, CNBC reported, and the 2-year yield had risen 7 basis points to 4.62 percent.

Asia on Tuesday

The rally carried into Asia. Japan's Nikkei 225 closed up 2.9 percent at 60,459.58, and South Korea's Kospi rose 4.4 percent to 5,239.13, according to AP. Hong Kong's Hang Seng gained 0.44 percent to 24,557.04. Technology and chip shares led, FXStreet reported.

U.S. futures and the CPI

As of 7:40 a.m. ET on Tuesday, Dow futures were up 0.3 percent, S&P 500 futures were slightly higher and Nasdaq-100 futures were down 0.3 percent, Yahoo Finance reported. Nvidia rebounded slightly in early trading, and oil was down more than 2 percent.

The October consumer price index is due at 8:30 a.m. ET. Economists polled by Dow Jones expect headline prices to rise 0.3 percent, after 0.6 percent in September, and core prices to rise 0.2 percent, after 0.3 percent, CNBC reported.

Fed Governor Christopher Waller said the Fed needs to follow through on an expected rate increase next month to maintain its credibility, according to CNBC. If inflation readings come in higher than expected, he said, "a 50 basis point hike in the policy rate should be considered at the December meeting." He added: "Hiking only 25 basis points would put our credibility at risk, a risk I am not eager to take." Markets have largely priced a quarter-point increase in December, according to CME FedWatch data cited by CNBC.