Gotrade News - Wall Street's three major indices closed at record highs on Wednesday (06/05) driven by hopes of a US-Iran peace agreement. Asian futures pointed higher overnight as the rally extended momentum across global markets.
The S&P 500 climbed 1.46% to 7,365.12 while the Nasdaq Composite jumped 2.02% to 25,838.94. The Dow Jones Industrial Average gained 1.24% or 612 points to 49,910.59 with all three setting new closing records.
Key Takeaways
- The rally was sparked by reports of a US-Iran peace agreement covering an Iranian nuclear enrichment moratorium
- AI and semiconductor stocks led the gains with AMD surging nearly 19 percent on upbeat second-quarter guidance
- Brent crude tumbled 7.83 percent, easing global inflation pressure and trimming Fed rate hike expectations
The advance followed an Axios report that the United States and Iran were nearing an agreement covering an Iranian nuclear enrichment moratorium. Iran's Foreign Ministry spokesperson confirmed Tehran was evaluating the US resolution proposal.
President Donald Trump said the deal remained preliminary on Wednesday evening local time. Trump warned airstrikes would resume at higher intensity if Iran rejected the proposal.
Trump also delayed Project Freedom, the planned redirection of shipping routes away from the Strait of Hormuz. He cited significant progress toward a complete and final agreement with Iranian representatives.
Artificial intelligence names led the rally as Advanced Micro Devices (AMD) surged 18.6 percent on upbeat second-quarter guidance. Strength spread across semiconductors with the VanEck Semiconductor ETF (SMH) up 5 percent and Intel (INTC) gaining 4.5 percent.
The rally widened to large-cap names with Nvidia (NVDA) adding 5.7 percent and Walt Disney (DIS) climbing 7.5 percent. Citing Kumparan, Uber (UBER) jumped 8.5 percent in the same session, reinforcing tech sector momentum.
West Texas Intermediate crude tumbled 7.03 percent to $95.08 per barrel during Wednesday's session. Brent crude fell 7.83 percent to $101.27 per barrel while gold prices surged and the dollar slid to pre-conflict levels.
Citing Bloomberg Technoz, futures for Hong Kong, Australia, and South Korea pointed higher for Thursday's (07/05) session. Japanese benchmarks were expected to advance as markets reopened from a national holiday.
The drop in energy prices reduced speculation around further Federal Reserve rate hikes. Treasury yields and global bonds rallied as inflation fears eased across markets.
Bill Northey of US Bank Asset Management Group said Southeast Asia and Europe could avoid greater economic pressure if the Strait of Hormuz normalized. International investors holding US equities through Gotrade may track whether AI and semiconductor momentum carries into Thursday's regular session.
