New York Stock Exchange hits record high due to semiconductor boom and easing Middle East tensions

In the New York stock market, the S&P 500 Index and the Nasdaq Composite Index once again hit record highs on the 24th (local time). This was due to a slight easing of the Middle East situation combined with strong performance improvements in the semiconductor industry, leading to a rapid influx of investment funds into technology stocks.

On that day, the S&P 500 Index rose 56.68 points (0.80%) from the previous trading day, closing at 7,165.08 points; the Nasdaq Composite Index increased by 398.09 points (1.63%), closing at 24,836.59 points. In contrast, the Dow Jones Industrial Average fell 79.61 points (0.16%), closing at 49,230.71 points due to weak performance of some traditional blue-chip stocks. On the same day, market attention was on the possibility of a second round of ceasefire negotiations between the U.S. and Iran. Following reports that Iranian Foreign Minister Abbas Araghchi visited Islamabad, Pakistan, there were also reports that U.S. President Trump’s son-in-law Jared Kushner and Middle East envoy Steve Weitkoff would visit Islamabad on the 25th, increasing expectations for the resumption of negotiations. Additionally, news of Israel and Lebanon extending their ceasefire agreement by three weeks raised hopes that geopolitical tensions might ease, boosting overall risk appetite in the stock market.

Expectations of easing tensions in the Middle East were immediately reflected in international oil prices. Brent crude oil futures for June delivery fell 0.25% from the previous trading day, closing at $105.33 per barrel; West Texas Intermediate (WTI) crude futures for June delivery dropped 1.51%, closing at $94.40 per barrel. The decline in oil prices helps alleviate corporate cost burdens and inflationary pressures, which is generally favorable for the stock market. Especially during this period when market expectations for interest rate cuts are highly sensitive, stable energy prices can easily support investor sentiment.

The core of this rally was semiconductor stocks. Intel announced better-than-expected first-quarter earnings and an optimistic outlook, with its stock soaring nearly 24%, the largest single-day gain since 2000. This trend spread across the entire industry. Nvidia rose 4.3%, reaching its highest point since October last year, with its market value once again exceeding $5 trillion. AMD increased by 13%, and Qualcomm rose by 10%. The Philadelphia Semiconductor Index has risen for 18 consecutive trading days, continuing the longest streak in history. Market analysts believe that as doubts about the profitability of large tech companies’ AI investments have eased, expectations for semiconductor demand have been renewed.

Uncertainty regarding monetary policy has decreased, which is also seen as a positive factor by the market. The U.S. Department of Justice decided to end its investigation into Federal Reserve Chairman Jerome Powell, which is considered to slightly ease concerns surrounding the Fed’s leadership. On that day, the value of the U.S. dollar and U.S. Treasury yields also declined in tandem. The dollar index, which measures the dollar against six major currencies, fell 0.17%, to 98.60 points; the 10-year U.S. Treasury yield dropped 1.5 basis points to 4.31%, and the 2-year Treasury yield fell 5.7 basis points to 3.78%. The market’s focus now shifts to the Federal Open Market Committee meeting scheduled for the 28th to 29th. Signals regarding the timing of rate cuts and how the future leadership of the Fed will develop are likely to be the key variables influencing the next phase of the market.