Wall Street Surges to Open August as Manufacturing Data Beats
U.S. stocks rallied sharply Monday, led by tech gains, strong ISM data, and falling Treasury yields to kick off August.
U.S. equities posted broad gains to open August on Monday as investors pivoted back to risk assets, with the S&P 500 climbing 1.50% and the Nasdaq surging 2.13%. Falling Treasury yields, a sharp drop in oil prices, and renewed appetite for large-cap technology stocks all fueled the advance, giving bulls a decisive start to the new month.
The session's standout data point was the ISM Manufacturing PMI for July, which came in at 55.6 — well above the 54.0 consensus estimate and up from 53.3 in June, its strongest reading in over four years. New Orders held firmly in expansion territory at 56.7, and the Employment Index jumped to 52.8 from 49.7, returning to growth for the first time in 33 months and reaching its highest level since August 2022. The Prices Paid component did ease to 71.1 from 73.0, though it remains elevated, signaling that manufacturing inflation has not yet been fully tamed.
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Adding to the constructive backdrop, the Atlanta Fed's GDPNow model lifted its growth estimate to 6.2% from a prior reading of 5%, reinforcing a picture of underlying economic resilience. White House National Economic Council Director Kevin Hassett also weighed in, describing recent U.S. inflation numbers as "fantastic" — commentary that aligned with the broader market's optimistic tone.
New York Fed President John Williams provided additional cover for equities by reiterating that the Fed's current policy stance is "well positioned" to guide inflation back to its 2% target. Williams expressed optimism that price pressures will gradually ease, while affirming the central bank's unwavering commitment to price stability and its readiness to act if progress stalls.
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