Wall Street gains as oil falls, Treasury yields decline

Wall Street's main indices have risen, powered by artificial intelligence gains as Treasury yields eased and crude prices tumbled more than 3.0 per cent to hit an 11-day low on hope of progress in Middle East negotiations during the United Nations meeting this week.

Doomsday warnings from the leaders of AI giants a week ago had led to a sell-off but the mood seemed lighter as investors focused on signs that spending on developing the technology was still expanding.

Advanced Micro Devices surged 8.5 per cent to become the latest chip maker to reach $US1 trillion ($A1.4 trillion) in market valuation and Micron also gained 3.0 per cent.

Meta soared 6.2 per cent to a more than seven-month high after brokerage Wells Fargo hiked its price target on the stock while Accenture gained 3.5 per cent after partnering with Anthropic to invest $US2 billion in AI evaluation.

"The excitement in the build-out and adoption of AI has really driven a lot of the growth in corporate profits and a lot of the gains in the stock market over the past few years," said Chris Zaccarelli, chief investment officer for Northlight Asset Management.

"Is there going to be a trade-off between safety and productivity benefits? That argument is going to continue for many months to come, if not many years."

While the US and Iran continued to exchange new threats through the weekend, US President Donald Trump said he would be open to meeting Iranian President Masoud Pezeshkian, who is expected at the UN General Assembly in New York this week.

A fall in oil prices eased the pressure on equities as the 10-year US bond yield slipped below the critical 5.0 per cent mark.

Still, investors were wary of the interest-rate outlook after a recent pickup in inflation prompted the US Federal Reserve to raise rates for the first time in three years.

Markets are pricing in a 50 per cent chance of another hike next month, CME's FedWatch showed.

Commentary from at least 10 central bank policy makers is due this week.

Chicago Fed president Austan Goolsbee said there was "no ambiguity" about the need for higher interest rates, with inflation pressures now moving beyond tariffs and energy prices to strong demand.

In early trading on Monday, the Dow Jones Industrial Average rose 241.25 points, or 0.47 per cent, to 51,923.89, the S&P 500 gained 70.38 points, or 0.92 per cent, to 7,720.88, and the Nasdaq Composite added 393.21 points, or 1.48 per cent, to 26,915.76.

Communication services was in the lead with a 2.3 per cent rise while energy led declines.