The S&P 500 rose 0.75% on Friday as investors weighed renewed hope for U.S.-Iran talks against persistent oil market volatility, with the index poised to reclaim its all-time high set earlier in the week. The Nasdaq Composite climbed 1.50%, reaching an intraday record, even as the Dow Jones Industrial Average slipped 0.17%, underscoring a divergence in market leadership driven by technology strength.
The rally was anchored by a surge in Intel shares, which jumped over 20% after reporting first-quarter earnings that exceeded expectations and issuing an optimistic outlook for the current quarter. CEO Lip-Bu Tan cited rising demand for AI-driven computing as a key factor, reinforcing a broader semiconductor rally that has seen the Philadelphia SE Semiconductor Index gain for 18 consecutive sessions. Rivals AMD and Arm each rose more than 15%, while Nvidia added 5% and was on track for a closing record.
Technology stocks, particularly those in the information technology sector, provided the primary lift to the broader market, gaining 2.3% and offsetting weakness elsewhere. This momentum came despite a preview of a new AI model from DeepSeek, which failed to dampen investor enthusiasm for established chipmakers. The S&P 500 and Nasdaq are now on pace for four consecutive weeks of gains, their longest streak since October 2024, while the Dow is set to end a three-week winning run.
Meanwhile, geopolitical developments provided a secondary but notable influence. Iranian Foreign Minister Abbas Araghchi was expected in Islamabad on Friday to discuss a potential second round of negotiations with U.S. Officials, according to Pakistani government sources cited across multiple outlets. The prospect of renewed dialogue offered temporary relief from a week marked by escalating tensions, including U.S. Naval blockades of Iranian ports and Iranian seizures of commercial vessels in the Strait of Hormuz.
Oil prices reflected the ongoing uncertainty, with Brent crude futures trading between $103 and $107 earlier in the day before settling near $104.53 for June delivery and $98.45 for July contracts — levels still roughly 44% above pre-war benchmarks due to disrupted shipping routes. West Texas Intermediate futures remained above $93 per barrel. Analysts noted the pullback in crude prices as a potential buying opportunity, though many questioned whether recent corporate earnings — based on just one month of war-related disruption — could reliably forecast future performance.
For more on this story, see S&P 500 and Nasdaq Hit Record Highs on Peace Optimism.
Market resilience, according to some observers, stems from a focus on underlying economic fundamentals rather than daily geopolitical swings. Robert Conzo of The Wealth Alliance suggested investors are increasingly treating the conflict as a short-term distraction, choosing to “look through” the volatility in favor of domestic economic strength. Others, like Jack Herr of GuideStone Funds, emphasized that while both sides have incentives to de-escalate, resolution will take time and cautioned against overreacting to daily fluctuations.
Attention is now shifting to the upcoming Federal Reserve meeting, where investors will seek clues on the timing of potential interest rate cuts and the future leadership of the central bank. The U.S. Justice Department’s decision to close its investigation into Fed Chair Jerome Powell has cleared a procedural hurdle for the confirmation of Kevin Warsh, Trump’s nominee to lead the Fed. Rate futures now price in a 34% chance of easing by year-end, up from 23% the previous day, according to LSEG estimates.
In individual corporate moves, Procter & Gamble rose 3.2% after reporting stronger-than-expected quarterly profits, citing broad-based growth across its product lines. In contrast, Charter Communications fell 23.6% following a disappointing quarter that included the loss of 120,000 internet subscribers, while Hartford Insurance Group declined 1.9% after profit growth fell short of forecasts.
This follows our earlier report, S&P 500 and Nasdaq Hit Record Highs on Peace Optimism.
In the bond market, Treasury yields eased as traders increased their bets on a resumption of rate cuts later in the year, reflecting shifting expectations about monetary policy amid ongoing economic and geopolitical uncertainty.
What caused the divergence between the S&P 500 and Nasdaq gains and the Dow’s decline?
The S&P 500 and Nasdaq were lifted by strong performances in technology and semiconductor stocks, particularly Intel and its peers, while the Dow Jones Industrial Average, which has less exposure to high-growth tech, declined due to weakness in industrial and financial components.
How significant is the potential for U.S.-Iran talks to reduce market volatility?
While the prospect of talks in Islamabad provided short-term relief, analysts caution that the underlying conflict in the Strait of Hormuz remains unresolved and oil prices continue to reflect supply risks, meaning any de-escalation would likely be gradual and fragile.
