U.S. stocks extended a late-summer run on Monday, with the Dow Jones Industrial Average, the S&P 500 and the Nasdaq all recording all-time highs for the third trading day in a row, powered by renewed enthusiasm for large-cap technology names and fresh corporate developments. The move comes as investors digest a recent Federal Reserve interest-rate cut and weigh the economic implications of new federal policy changes.

Nvidia led a tech-sector burst at the open after reports that the chipmaker and OpenAI had expanded their partnership to accelerate custom AI hardware and services. Nvidia shares opened sharply higher, lifting the Nasdaq and pulling the S&P 500 along with it. Traders said the news reinforced the view that AI-related revenue growth is accelerating for a narrow group of companies and that those firms will be prime beneficiaries of incremental corporate spending on advanced computing.

“This feels like a leadership-driven market, where the winners of the AI era are pulling the averages higher,” said a New York-based portfolio manager at a large asset manager. “That’s positive for headline returns, but it also raises questions about breadth and valuation across the rest of the market.”

Market participants cited two broader forces underpinning the rally. First, the Federal Reserve’s rate cut earlier this month has eased borrowing costs, encouraging risk-taking and re-pricing equities that are sensitive to long-term growth prospects. Second, the policy environment has shifted with Congress’ passage of what proponents dubbed the “One Big, Beautiful Bill,” which reduces federal student-loan availability starting in the 2026-27 academic year—an outcome some economists say could redirect demand to private credit markets and subtly alter the consumer-credit landscape.

Analysts noted that while headline indices are at record highs, market internals remain mixed. Several smaller-cap and cyclical sectors continue to lag the tech giants, and trading volumes on record days have not consistently signaled broad-based participation. “You can’t ignore the concentration risk,” said an equity strategist. “When the market is dominated by a handful of mega-cap names, sentiment can swing quickly if growth expectations or AI spending patterns change.”

Investors will be watching upcoming economic releases and corporate earnings for confirmation that the growth outlook supports lofty valuations. Inflation readings and labor-market data remain decisive for the Fed’s future policy path, while quarterly results from banks, health-care companies and consumer discretionary firms will test assumptions about the sustainability of revenue growth outside the technology sector.

For now, traders appear content to reward companies tied to artificial intelligence and related infrastructure, driving headline market gains even as questions about risk distribution and long-term returns persist. The next stretch of data and earnings will determine whether the rally broadens beyond the current leadership and whether Wall Street’s appetite for concentrated bets endures.