S&P 500, Nasdaq hit record highs as chip strength offsets Iran worries

By Ragini Mathur and Utkarsh Hathi

The S&P 500 and the Nasdaq climbed to intraday record highs on Monday, extending last week's rally, as strength in chip stocks offset a jump in oil prices sparked by stalled U.S.-Iran talks.

U.S. President Donald Trump's swift rejection of Iran's response to a U.S. peace proposal stoked worries that the 10-week-old conflict could drag on and keep shipping through the Strait of Hormuz paralyzed. That sent crude prices up almost 3%. [O/R]

Even so, higher oil prices have so far done little to knock the broader market off course. The S&P 500 and the Nasdaq both closed at record highs on Friday, supported by upbeat corporate earnings, renewed optimism around semiconductor stocks and a solid monthly payrolls report that pointed to continued resilience in the U.S. economy.

That resilience could face a fresh test this week as the earnings season winds down and investors turn to key economic data.

Tuesday's consumer price index report is expected to show inflation picked up in April, reflecting upward pressure on energy prices from the Middle East conflict. Producer price data and monthly retail sales figures are also due later in the week.

"The worry list is long, but the economy keeps proving the bears wrong," said Robert Edwards, chief investment officer, Edwards Asset Management

"Big tech has regained its leadership, backed by solid and growing revenue and earnings. These names sit at the center of every major secular theme."

At 12:15 p.m. ET, the Dow Jones Industrial Average fell 3.66 points, or 0.01%, to 49,605.50, the S&P 500 gained 24.74 points, or 0.33%, to 7,423.67 and the Nasdaq Composite gained 104.59 points, or 0.40%, to 26,351.67.

The S&P 500 energy and materials led sector gains on Monday, rising 2.1% and 1.4%, respectively, while heavyweight technology advanced 1.1%.

Nvidia and Micron Technology boosted the sector, rising 3.2% and 6.3%, respectively. Qualcomm surged 9.3% to touch a record high.

Intel rose 2.4% after surging 14% on Friday on a report of a preliminary chip-making agreement with Apple.

Also on the radar is a meeting between Trump and Chinese President Xi Jinping later this week, when the two leaders are set to discuss Iran, Taiwan, artificial intelligence and nuclear weapons, while also weighing an extension of a critical minerals deal.

Major names due to report this week include tech networking giant Cisco and semiconductor equipment maker Applied Materials, while heavyweights Nvidia and Walmart are due to report later in the month.

Media major Fox Corp rose 1.7% after beating Wall Street estimates for third-quarter revenue.

Among other moves, some airline stocks slipped as rising oil prices threatened to squeeze margins. Southwest Airlines, Delta Air Lines, Alaska Air and United Airlines fell between 4% and 1.6%.

Declining issues outnumbered advancers by a 1.02-to-1 ratio on the NYSE and by a 1.11-to-1 ratio on Nasdaq.

The S&P 500 posted 34 new 52-week highs and 37 new lows while the Nasdaq Composite recorded 131 new highs and 123 new lows.

(Reporting by Ragini Mathur and Utkarsh Hathi in Bengaluru; Editing by Devika Syamnath)

Copyright Reuters or USA Today Network via Reuters Connect.

This story was originally published May 11, 2026 at 11:31 AM.