Apple’s rally takes Wall Street to record high

NEW YORK (AP) — U.S. stocks rose to record highs on Monday.

The S&P 500 rose 1.1% and moved within 0.3% of its all-time high set earlier this month. The Dow Jones Industrial Average jumped 515 points, or 1.1%, and the Nasdaq composite gained 1.4%.

Apple led the way, rising 3.9% amid optimism about demand for its latest iPhone design. It was the most powerful force that drove the S&P 500 and set its own record.

Cleveland-Cliffs rose 21.5% after the steel company’s CEO Lourenco Goncalves said he would soon provide details on a possible deal with a major global steel producer that could mean higher profits. He also said his company may have found signs of rare earths at sites in Michigan and Minnesota.

Such materials have gained global attention after China recently curbed the export of its own rare earths, a move that President Donald Trump characterized as hostile. Trump’s subsequent threat to raise tariffs caused big swings on Wall Street, but concerns eased somewhat after Trump said such high tax rates on Chinese imports are unsustainable.

Another source of concern for Wall Street, that of the banking sector, also appears to be diminishing. Shares of smaller and midsize banks rose on Monday, recouping some of their losses after a couple of them sounded alarm bells last week by warning about potentially bad loans they had made.

Zions Bancorp. gained 4.7% on Monday following its 5.1% drop last week, when it said it had found “apparent misrepresentations and contractual breaches” related to a pair of borrowers.

Amazon shares held up despite a widespread outage of its cloud computing service that caused disruptions to internet users around the world on Monday. Amazon shares rose 1.6%.

In total, the S&P 500 added 71.12 points to 6,735.13. The Dow Jones Industrial Average rose 515.97 to 46,706.58, and the Nasdaq composite gained 310.57 to 22,990.54.

This week features a number of big names reporting their latest quarterly results, including Coca-Cola on Tuesday, Tesla on Wednesday and Procter & Gamble on Friday.

The pressure is on companies in general to show that their profits are growing after a torrid 35% advance for the S&P 500 from a low in April. Earning higher profits is one of the easiest ways for companies to quell criticism that stock prices have risen too much. The other is for stock prices to fall.

Corporate earnings reports have also become more important because they offer windows into the strength of the U.S. economy when the U.S. government shutdown has delayed major economic updates.

That makes the Fed’s job more difficult as it tries to decide whether high inflation or a slowing labor market is the bigger problem for the economy. Federal Reserve officials have indicated they are likely to cut rates several more times to give the economy a boost. But that could be a mistake if inflation worsens, because low interest rates can push it up even higher.

On Friday, the US government will issue an inflation update for September. The report was supposed to arrive at the beginning of the month, and the Social Security Administration needs the numbers to calculate cost-of-living adjustments for beneficiaries. But the government also said: “No other launches will be rescheduled or produced until regular government services resume.”

In the bond market, Treasury yields remained relatively stable. The 10-year Treasury yield fell to 3.98% from 4.02% late Friday.

In foreign stock markets, indices rose in much of Europe and Asia.

Japan’s Nikkei 225 rose 3.4% after the ruling Liberal Democrats found a new coalition partner, securing support for their leader Sanae Takaichi to become the country’s prime minister. Investors hope Takaichi, who would also be Japan’s first female prime minister, will push for low interest rates, more government spending and other policies that could help the market.

Indices rose 2.4% in Hong Kong and 0.6% in Shanghai after China reported its economy grew at an annual pace of 4.8% in the latest quarter, supported by relatively strong exports as companies increased shipments to markets other than the United States.

Still, it was the slowest pace in a year. The world’s second-largest economy is still struggling to emerge from a prolonged crisis in its housing market and encourage consumers and businesses to spend more.

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AP Business writers David McHugh and Elaine Kurtenbach contributed.