S&P 500 Hits Record Highs as AI Chip Stocks Surge and Oil Slides on Iran Talks
wealthvista.top Editorial · May 27, 2026 · 8 min read
Executive Summary
The S&P 500 and Nasdaq closed at record highs Tuesday, driven by another wave of AI-driven buying in semiconductor stocks. Micron became the latest $1 trillion company as AI memory demand shows no signs of cooling. Crude oil slid to a 2.5-week low as US-Iran nuclear talks advanced, with Washington Post reporting the two sides were finalizing a 60-day ceasefire extension memorandum. On the earnings front, Zscaler plummeted 24% after revenue guidance missed despite a Q3 beat. Salesforce and Marvell report after the bell Wednesday, the next test of the AI spending thesis.
S&P 500, Nasdaq Hit Fresh Highs as AI Chip Stocks Lead
Wall Street’s artificial intelligence trade is alive and well.
The S&P 500 closed up 0.61% Tuesday, and the Nasdaq 100 surged 1.76%, with both benchmarks logging new all-time highs. Tech was the obvious driver — semiconductor stocks broadly outperformed as investors continued to pile into anything related to AI compute and memory.
Goldman Sachs raised its S&P 500 year-end target to 8,000 from 7,600, citing an exceptionally strong first-quarter earnings season and upgraded profit forecasts. The note acknowledged “a bumpy path ahead” but said the earnings backdrop justifies the optimism. That’s a meaningful upgrade from a major bank that has been relatively cautious on valuations.
By Wednesday morning, futures were pointing to more of the same: S&P 500 futures up 0.62%, Nasdaq 100 futures up 0.6%. The AI trade was still running, even as geopolitical noise — including US strikes on Iranian missile sites overnight — barely registered with equity markets.
Image source: Unsplash
Sources: Stocks Finish Mostly Higher on Iran Peace Progress — Barchart · Dow Jones Futures Rise After S&P 500, Nasdaq Hit Highs — Yahoo Finance · Goldman Sachs raises S&P 500 year-end target — Yahoo Finance
Micron Joins the $1 Trillion Club as AI Memory Demand Explodes
Memory chip maker Micron Technology crossed a milestone Wednesday, with its market cap hitting $1 trillion for the first time — making it one of a handful of companies to reach that tier alongside Apple, Microsoft, and Nvidia.
The rally was driven by the same AI infrastructure buildout that’s been lifting the entire semiconductor food chain. High-bandwidth memory (HBM) chips — the kind used in AI servers — remain structurally undersupplied, and Micron has been selling everything it can make. The company’s results have consistently beaten expectations as cloud providers and AI model trainers keep placing orders well ahead of supply.
SK Hynix, the South Korean memory giant that supplies HBM to Nvidia, also hit $1 trillion Wednesday, gaining 9.3%. It became the third Asian company to cross the milestone after Samsung and Micron.
The knock-on effect rippled through the chip sector: Marvell Technology surged 5.7%, Qualcomm climbed 3.5%, and a range of semiconductor equipment names moved higher following Micron’s beat. The argument that AI-driven chip demand is structurally undersupplied — which is bullish for the foundries and equipment makers building out capacity — keeps gaining traction.
Sources: Micron stock hits $1 trillion market cap — Yahoo Finance · SK Hynix hits $1 trillion market cap — Yahoo Finance · Why Marvell Technology stock is rocketing higher — Yahoo Finance
Oil Falls to 2.5-Week Low as Iran Diplomacy Makes Progress
Crude oil prices dropped sharply Tuesday as news broke that US-Iran negotiations were advancing toward a deal that could reopen the Strait of Hormuz — the world’s most critical oil transit chokepoint.
According to the Washington Post, both sides had developed a memorandum that would extend the current ceasefire by 60 days while working toward a permanent agreement. If signed, the Strait would be de-mined and reopened. Secretary of State Marco Rubio said talks were still ongoing and would “take a few days,” but the direction was clearly positive.
WTI crude fell to its lowest level in two and a half weeks on the news. The 10-year Treasury note yield also slipped to 4.47%, a 1.5-week low. Lower oil and bond yields together created a favorable environment for technology stocks, which leaned into the dip.
The geopolitical picture remained messy, though. US Central Command said American forces struck Iranian missile-launch sites and boats attempting to plant mines in the Strait — the same waters under diplomatic discussion. That duality — military action alongside diplomatic progress — is pretty typical of how these negotiations actually unfold.
Sources: Stocks Finish Mostly Higher on Iran Peace Progress — Barchart · Oil falls, stocks mixed as investors eye tech, US-Iran talks — Yahoo Finance
Zscaler Plunges 24% on Weak Guidance, Sales Shake-Up
Cloud security firm Zscaler reported fiscal Q3 results Wednesday that beat on the top and bottom lines — but the market was focused entirely on the outlook.
Revenue for the quarter came in at $850.5 million, up 25.4% year-over-year and above the FactSet consensus of $835.6 million. Adjusted earnings of $1.08 per share beat estimates of $1.01. The numbers were fine. The guidance was not.
For fiscal Q4, Zscaler guided revenue of $875 million to $878 million — slightly below the Street consensus of $878.6 million. More concerning: the company cut its full-year free cash flow outlook, and CFO Chris Olson flagged a “sales leadership transition” in the earnings call. Two senior sales executives departed recently, which management acknowledged created some disruption.
Zscaler stock collapsed 24% in premarket trading. Retail traders jumped in, calling the drop excessive and buying the dip — but the concerns about slowing growth and execution risk were real enough that the stock has now given back a significant chunk of its recent gains.
The cybersecurity sector has been under pressure as investors worry about whether enterprise security spending is holding up in an environment where AI-driven infrastructure buildout is consuming IT budgets.
Sources: Earnings live updates: Zscaler stock plunges 24% premarket — Yahoo Finance · Zscaler issues revenue outlook below Street views — Yahoo Finance
Earnings Calendar: Salesforce and Marvell Due After Market
The next test of the AI investment thesis comes Wednesday after the closing bell, when Salesforce and Marvell Technology both report quarterly results.
Salesforce is expected to post fiscal Q1 results in line with expectations, according to Jefferies, which cited proprietary partner surveys showing 55% of respondents finished Q1 at plan and 30% came in above. Investors will be listening closely for commentary on Agentforce — the company’s AI agent platform — and whether it can offset any maturation in the core CRM business. The stock has been trading below industry valuation levels, which makes the bar for a beat-or-miss reaction higher than usual.
Marvell is the more semantically linked to today’s chip rally. The data center interconnect and custom chip designer has been riding the AI infrastructure wave hard, and expectations are elevated following Micron’s blowout results. MRVL stock was up 5.7% Tuesday as investors positioned ahead of the print.
Also reporting Wednesday: Synopsys, Snowflake, and HP Inc — collectively giving investors a wider window into AI compute demand and the PC market’s recovery.
Sources: Nasdaq tech stocks set to lead ahead of Salesforce and Marvell earnings — Proactive Investors · Salesforce earnings preview — Proactive Investors
Crypto: Fear & Greed Index Hits “Extreme Fear” as Bitcoin Struggles
Bitcoin dropped back below the $76,000 level Wednesday as the Crypto Fear & Greed Index fell into “Extreme Fear” territory with a reading of just 25 out of 100.
The broader crypto mood has soured in recent weeks, with macro uncertainty, regulatory pressure, and a lack of new institutional catalysts weighing on prices. Bitcoin is still well off its 2025 highs, and the narrative around institutional adoption has cooled.
One notable development: Michael Saylor’s Strategy — the world’s largest corporate Bitcoin holder with roughly $64 billion in BTC — paused its crypto purchase program and instead used $1.5 billion in cash reserves to repurchase convertible bonds maturing in 2029. The buyback was executed at roughly an 8% discount to par. Saylor said the company is “getting the balance sheet in order” rather than adding to the Bitcoin stack at current prices. Smaller Bitcoin treasury companies like Metaplanet and BitMine kept buying, adding a combined 603 BTC last week while Strategy sat out.
Strategy stock was up despite the pause — investors apparently liked the debt reduction move.
Sources: Crypto Fear & Greed Index — Stocktwits · Strategy pauses Bitcoin purchases to shore up balance sheet — Yahoo Finance
Dollar Softens as Markets Price in Fed Rate Cuts
The dollar was on the back foot Wednesday as bond yields continued trending lower on expectations that the Federal Reserve will cut rates later this year.
JPMorgan analysts said both bond yields and the dollar are likely to continue moving lower as markets price in Fed rate cuts. The view is that summer data will determine whether tariffs are delivering a sustained inflation bump — in which case the Fed stays on hold — or whether the inflation effect clears quickly enough to give policymakers room to ease.
The dollar index DXY has been trending down from its recent peaks as the “exceptionalism” trade that supported the greenback earlier in the year has weakened. If the Fed does cut before year-end, that would likely put more downward pressure on the dollar and support emerging market currencies.
Sources: Dollar’s fate hangs on summer’s biggest FX test — Yahoo Finance · Bond yields and U.S. dollar to continue moving lower — Yahoo Finance
Week Ahead: Inflation Data, Fed Speakers in Focus
Looking ahead, the economic calendar picks up with key inflation readings and Fed speakers that could shift rate expectations.
Personal Consumption Expenditures (PCE) data — the Fed’s preferred inflation gauge — is due Friday. After April’s CPI came in hotter than expected, the market will be watching closely to see if price pressures are re-accelerating or retreating. Any upside surprise could further delay Fed rate cut expectations.
Several Fed officials are on the calendar this week, including Governor Christopher Waller and New York Fed President John Williams. Their comments will be parsed for any shift in tone after recent data surprised to the upside on inflation.
Earnings season continues to wind down, but the batch reporting this week — Salesforce, Marvell, Snowflake — will set the tone for how the market values AI infrastructure spending heading into the second half of the year.
Disclaimer: This report is for informational purposes only and does not constitute investment advice.