The S&P 500 (NYSE:SPY) surged on Monday as easing geopolitical tensions, falling oil prices and renewed strength in megacap technology stocks fueled a broad market rally. Polymarket traders are now betting the benchmark index will build on those gains at Tuesday’s open.
The S&P 500 rose 1.48% to close at 7,600.50, after opening at 7,504.78. The Aug. 4 Polymarket contract implied a 77% probability that the index will open higher on Tuesday.
Why That Number Matters
Monday’s rally marked a sharp reversal from July’s technology-led selloff as investors regained confidence that heavy artificial intelligence spending is continuing to generate meaningful returns.
The move was also supported by easing geopolitical tensions after President Donald Trump said over the weekend that he had called off planned U.S. strikes on Iran and that negotiations between Washington and Tehran would resume. The remarks followed reports late last week that the administration had been preparing another wave of military action. The prospect of renewed diplomacy helped send oil prices sharply lower and improved risk appetite across global markets.
The shift in sentiment was also reflected on Polymarket. The Aug. 3 contract attracted roughly $594,636 in traded volume — the highest participation in weeks and a sharp jump from the relatively muted activity seen through much of July, underscoring heightened investor interest following the geopolitical developments.
The Bull Case
Investor sentiment has improved markedly as lower oil prices eased inflation concerns while stronger-than-expected earnings reinforced confidence in the AI trade.
Amazon.com Inc. (NASDAQ:AMZN) surpassed a $3 trillion market capitalization for the first time, while Meta Platforms Inc. (NASDAQ:META), Nvidia Corp. (NASDAQ:NVDA), Alphabet Inc. (NASDAQ:GOOGL) (NASDAQ:GOOG) and Microsoft Corp. (NASDAQ:MSFT) all posted strong gains.
Tuesday’s earnings calendar also provides another opportunity for markets to build on that momentum, with AMD‘s (NASDAQ:AMD) results expected to offer fresh insight into semiconductor demand.
Investors will monitor June factory orders, international trade data and corporate updates for signs that economic momentum remains intact after July’s market volatility.
S&P 500 futures added 0.21% early Tuesday, ahead of expected earnings from Caterpillar Inc. (NYSE:CAT) and McDonald’s Corp (NYSE:MCD).
How The Previous Bet Played Out: The S&P 500 opened on Monday at 7,504.78, above Friday’s close of 7,489.72, meaning the Aug. 3 Polymarket contract ultimately resolved “Up.”
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