Bargain hunting activity poured into recently battered technology shares on Monday, driving a rebound in US stocks from last week's losses.

The tech-heavy Nasdaq 100 Index closed 2.3% higher in New York, reversing its decline from Friday.

"Risk appetite is returning at the start of this holiday-shortened trading week as investors downplay concerns about AI spending and add to their positions in the Magnificent Seven US tech stocks," said José Torres, a senior economist at Interactive Brokers.

The S&P 500 Index rose 1.2%, while the Dow Jones Industrial Average gained 0.6%, setting another record high.

The Philadelphia Semiconductor Index surged 3.8%, bouncing back from its worst weekly performance since April 2025 recorded last week.

Earlier, South Korea announced a major investment plan targeting chips and data centers. The country is planning for companies like Samsung Electronics and SK Hynix to invest at least 1,350 trillion won ($880 billion) into chips and data centers.

Russ Mould, investment director at AJ Bell, stated that this plan will be "closely watched" by investors. Previously, share price declines for Samsung Electronics and SK Hynix were cited as one of the reasons for last week's tech sell-off.

In a separate development, the US Supreme Court, in a 5-to-4 ruling, further cemented the Federal Reserve's independence from the White House, stating the President cannot remove a central bank governor without cause.

Michael Feroli, chief US economist at JPMorgan Chase, noted that for new Fed Chair Kevin Warsh, this ruling is "broadly positive, as Trump now cannot remove Warsh from his post."

The US and Iran agreed to halt attacks on each other ahead of planned peace talks this week concerning the Strait of Hormuz and other issues.

"Despite likely short-term violations of any ceasefire, we believe the US and Iran will eventually reach an agreement. We do not see any deal as a long-term solution for the Middle East, but more likely a means to restore oil shipments through the Strait of Hormuz," wrote Mohit Kumar, an analyst at Jefferies.

Shares of Comcast closed 4.5% higher after announcing plans to spin off NBCUniversal and Sky.

At the close, the S&P 500 was up 1.2% at 7,440.43.

The Dow Jones Industrial Average was up 0.6% at 52,182.74.

The Nasdaq Composite Index was up 2.1% at 25,820.14.

The Nasdaq 100 Index was up 2.3% at 29,774.75.

The Russell 2000 Index was largely flat at 3,010.417.