S&P 500 and Nasdaq Hit Record Highs on AI Boom and US Iran Peace Hopes

Stock Market Rally Driven by AI Optimism and Strong Earnings

US equities surged to fresh record levels as the S&P 500 and Nasdaq extended gains on growing enthusiasm around artificial intelligence and resilient corporate earnings. The rally was supported by strong guidance from Advanced Micro Devices, which forecast higher than expected second quarter revenue due to demand for data center chips.

Market sentiment remained elevated, with analysts noting continued investor confidence in AI-driven growth despite broader macroeconomic uncertainties. Gains were widespread, with eight of the eleven S&P 500 sectors closing higher and the Philadelphia Semiconductor Index rising 2.9% to a new high.

Economic Data and Oil Prices Support Risk Appetite

Brent crude prices dropped 6.6%, easing inflation concerns and supporting consumer outlooks, though the energy sector declined around 3%.

US Iran Peace Talks Boost Market Confidence

Investor sentiment was further lifted by reports that Washington and Tehran are nearing a one-page agreement to end the conflict and begin a 30-day negotiation process. The proposed framework includes reopening the Strait of Hormuz, limiting Iran’s nuclear program and easing sanctions.

While optimism remains strong, analysts caution that markets could reverse if geopolitical tensions escalate again. Still, expectations that conflict risks may ease continue to support equities, with advancing stocks outpacing decliners across major exchanges.