Financial Markets                      06/01 16:08

   

   NEW YORK (AP) -- Oil prices rose Monday following the latest fighting to 
threaten the U.S.-Iran ceasefire, but Wall Street isn't very worried, and U.S. 
stocks ticked to more records.

   The S&P 500 added 0.3% to its prior all-time high set on Friday. The Dow 
Jones Industrial Average rose 46 points, or 0.1%, and the Nasdaq composite 
climbed 0.4% to likewise set records.

   A slight majority of U.S. stocks actually fell, including companies with big 
fuel bills hurt by higher oil prices. United Airlines lost 2.6%, and Alaska Air 
Group fell 3.3% after the price for a barrel of Brent crude oil climbed 4.2% to 
settle at $94.98. That clawed back a chunk of Brent's loss from last week and 
means it's still well above its price of roughly $70 from before the war.

   Expensive oil has already sent inflation higher, which increases not only 
bills for households but also yields in the bond market. High yields worldwide 
recently have threatened to slow economies and undercut prices for stocks and 
all kinds of other investments.

   But yields regressed during the day after oil prices came off their highest 
levels. That eased some of the pressure on Wall Street, and the Russell 2000 
index of the smallest U.S. stocks went from a loss of 1.3% back to roughly even 
before finishing with a dip of 0.5%. Small companies can feel the pinch of 
higher borrowing costs in particular because of the need for many to borrow to 
grow.

   Hope, meanwhile, seems to remain on Wall Street that the United States and 
Iran will ultimately reach an agreement to reopen the Strait of Hormuz, allow 
deliveries of oil to resume from the Persian Gulf and ease the upward pressure 
on inflation.

   Strength from several market heavyweights also helped to power Wall Street.

   Nvidia was the strongest force lifting the market and rose 6.2% after CEO 
Jensen Huang announced several product updates at a conference. What Nvidia 
does matters immensely for the U.S. stock market because it's the biggest in 
terms of overall market value. That means the movements for its stock carry 
more weight on the S&P 500 than any other's.

   And Wall Street's biggest companies have been growing so much that they're 
dominating the market. The top 10 stocks control nearly half the S&P 500's 
total market value, a 40-year high, according to Thomas Carroll, equity market 
strategist at Stifel.

   That worked well as Big Tech stocks shot higher thanks to exuberance around 
artificial intelligence. But it could also weigh on the index if the market's 
leadership broadens, Carroll warns. Even if most stocks end up rising in such a 
rotation, stagnation or declines for Big Tech heavyweights could drag on S&P 
500 index funds.

   A key indicator Carroll follows about market breadth "is signaling a 
rotation is coming," he wrote in a report.

   Elsewhere on Wall Street, Science Applications International Corp. jumped 
10.4% after becoming the latest U.S. company to report bigger profit for the 
latest quarter than analysts expected. SAIC also raised forecasts for upcoming 
financial results.

   A cavalcade of such better-than-expected profit reports has helped the U.S. 
stock market push to records despite the uncertainty created by the war with 
Iran.

   Berkshire Hathaway fell 0.9% after saying it would buy homebuilder Taylor 
Morrison Home for $6.8 billion. It's one of the first big acquisitions 
announced by the company since Greg Abel took over as its leader from famed 
investor Warren Buffett. Taylor Morrison Home jumped 22.3%.

   MGM Resorts International leaped 16.1% after People Inc., Barry Diller's 
business that was formerly known as IAC, offered to buy the rest of the company 
it doesn't already own for $48.30 per share in cash.

   All told, the S&P 500 rose 19.90 points to 7,599.96. The Dow Jones 
Industrial Average added 46.42 to 51,078.88, and the Nasdaq composite rose 
114.19 to 27,086.81.

   In the bond market, Treasury yields climbed with oil prices and after a 
report said growth in U.S. manufacturing accelerated by more last month than 
economists expected. The yield for the 10-year Treasury briefly approached 
4.52% before regressing to 4.46%, up from 4.45% late Friday.

   High yields have already forced the average long-term U.S. mortgage rate to 
its most expensive level in nine months, and they could curtail companies' 
borrowing to build the AI data centers that have supported the U.S. economy's 
growth recently.

   In stock markets abroad, indexes fell in Europe following a stronger finish 
in Asia.

   Tokyo's Nikkei 225 rose 0.9% to an all-time high. SoftBank Group, the 
investment company that focuses heavily on AI, soared 21.2% and surpassed 
Toyota to become Japan's most valuable listed company.

   In South Korea, the Kospi index jumped 3.7% to a record after data showed 
the country's exports surged 53% in May from a year earlier, buoyed by global 
demand for semiconductors.

   ___

   AP Business Writers Chan Ho-him and Matt Ott contributed.

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