AI-Fueled Rally Puts S&P 500 on Track for Eighth Weekly Gain
US stocks advanced as investors struck an upbeat tone ahead of a long holiday weekend, with optimism fueled by hopes for resolution of hostilities in the Middle East, resilient economic data and relentless enthusiasm for artificial intelligence-linked trades.
The S&P 500 rose 0.6% at 9:41 a.m. in New York, putting the benchmark on track for an eighth straight week of gains, its longest winning streak since 2023. The Nasdaq 100 added 0.8%, as traders continued piling into AI beneficiaries and broader technology themes. The Cboe Volatility Index, or VIX, hovered near its lowest level since early February, a sign of market calm despite uncertainty around the Iran conflict.
Brent crude rebounded, though prices remained lower for the week as investors grew more confident that the US and Iran may avoid a wider escalation.
Equity investors have largely shrugged off concerns that disruptions to energy flows could reignite inflation pressures. Instead, they have focused on signs of economic resilience and the growing breadth of AI-related spending across corporate America.
“Global bond markets are signaling a repricing of risk — spanning stickier inflation and expansionary fiscal policy amidst the threat of a prolonged Strait of Hormuz disruption,” said Seema Shah, chief global strategist at Principal Asset Management. “While such moves would typically challenge equities, resilient earnings powered by the formidable AI capex cycle are helping markets look beyond higher yields towards a productivity-driven growth outlook.”
Strategists at Evercore ISI pointed to Thursday’s stronger-than-expected S&P Global PMI reading on manufacturing activity as further evidence of “US exceptionalism,” citing domestic energy production, AI capital expenditures and wealth creation as key drivers.
Corporate activity has also supported sentiment. Announced stock buybacks and cash takeovers have already surpassed $1 trillion globally this year, according to EPFR Global data.
