The New York Stock Exchange hits a new high due to strong employment and soaring semiconductor stocks

The U.S. stock market in New York on the 8th expanded its gains driven by strong employment indicators and a surge in semiconductor stocks, with both the S&P 500 Index and the Nasdaq Composite reaching new all-time highs again. Although rising international oil prices due to ongoing Middle East tensions continue to exert pressure, the market places greater emphasis on the fact that the U.S. economic fundamentals remain solid.

That day, the S&P 500 Index rose 61.82 points (0.84%) from the previous trading day, closing at 7,398.93 points; the Nasdaq Composite increased 440.88 points (1.71%), closing at 26,247.08 points; the Dow Jones Industrial Average rose 12.19 points (0.02%), closing at 49,609.16 points, with relatively limited movement. The two major indices maintained an upward trend for six consecutive weeks based on Friday’s closing prices, indicating that recent market sensitivity to interest rate variables is less than its concern about whether the economy is slowing down.

The direct driver of the stock price rally was the unexpectedly strong April employment data. According to the U.S. Department of Labor, non-farm payrolls increased by 115k in April, more than double the market expectation of 55k. This suggests that even amid heightened concerns about high oil prices due to U.S.-Iran conflicts, the employment market remains resilient. Market interpretation of these data is that, although the timing of rate cuts may be slightly delayed, the likelihood of the U.S. economy achieving a soft landing without falling into recession and maintaining stable prices has increased. Accordingly, the yield on the 10-year U.S. Treasury fell 2 basis points (1bp=0.01 percentage point) to 4.36%, while the 2-year Treasury yield was at 3.89%, nearly unchanged.

From an industry perspective, semiconductor stocks led the rally. Intel’s stock soared nearly 14% after The Wall Street Journal reported that it secured a production contract for Apple’s next-generation device chips. Previously, the market believed Intel’s competitiveness was recovering slowly, but expectations that its foundry business might see a real turning point have greatly increased. Intel’s market value has exceeded $540 billion, with a gain of about 250% this year. This optimism has also spread to other semiconductor stocks like Nvidia and AMD, boosting overall tech sector investor sentiment.

However, uncertainties remain. The University of Michigan’s preliminary May consumer confidence index was 48.2, the lowest since 1952 with available statistics. Data shows that about 30% of consumers mentioned tariffs, and concerns about rising oil prices are also prominent. Tensions in the Middle East remain high; U.S. military reports that two Iranian oil tankers heading to Iranian ports were paralyzed in the Gulf of Oman, after clashes near the Strait of Hormuz the previous day. As a result, July-delivered Brent crude futures traded at $101.29 per barrel, and June-delivered West Texas Intermediate (WTI) futures at $95.42 per barrel. However, on a weekly basis, both declined over 6%, indicating that the recent rapid rise is not sustained in a one-way manner.

In the foreign exchange and safe-haven assets markets, the Bloomberg U.S. dollar spot index fell 0.2%, while gold spot prices rose 0.8% to $4,772.81 per ounce. This reflects that, while risk appetite remains intact, the market has not completely ignored geopolitical risks. Investors are likely to evaluate employment, inflation, oil prices, and Middle East tensions simultaneously in the coming period to gauge the market direction. Under the backdrop of continued U.S. economic resilience, this trend could translate into a stock market rally, but if rising energy prices again stimulate inflation, expectations for interest rate paths could be shaken once more.