S&P 500 and Nasdaq Hit Record Highs Amid Iran Conflict

The S&P 500 and Nasdaq Composite both closed at record highs on May 11, even as geopolitical tensions between the United States and Iran intensified [1]. Despite concerns over the stability of a month-old ceasefire and a surge in energy costs, investors remained focused on the strength of the technology sector [1].

Key takeaways

• The S&P 500 rose 0.19% to a record 7,412.84, while the Nasdaq Composite gained 0.1% to reach 26,274.13 [1].
• US West Texas Intermediate crude oil settled up 2.78% at $98.07 per barrel following the rejection of a new Iranian proposal [1].
• Technology companies, particularly those involved in artificial intelligence, continued to drive market momentum [1].
• Copper prices reached a record close of $6.4605, extending gains for 2026 to over 13% [1].

Market Resilience Amid Geopolitical Uncertainty

The market rally persisted despite a breakdown in diplomatic efforts between the US and Iran. Iran had submitted a new proposal to US negotiators intended to end the war and lift sanctions, but President Donald Trump rejected the offer, labeling it “TOTALLY UNACCEPTABLE!” in a post on Truth Social [1]. Following the rejection, President Trump warned that the existing ceasefire was “on life support” and described the agreement as “unbelievably weak” [1].

In response to the heightened tensions, oil prices experienced a significant jump. Brent crude rose 2.88% to close at $104.20 per barrel [1]. However, market participants appeared largely unfazed by these developments, choosing instead to prioritize the performance of AI-related stocks [1]. Jay Hatfield, founder and CEO of Infrastructure Capital Advisors, noted that the technology boom is currently so powerful that many investors are “tuning out the Middle East” [1].

AI Sector Drives Investor Optimism

The technology sector remained the primary engine for the market’s record-breaking performance. Chipmaker Micron Technology saw its shares rise 6.5%, while NVIDIA gained nearly 2% [1]. Analysts at Citigroup continue to view the Nasdaq 100 as a preferred vehicle for exposure to the artificial intelligence boom [1]. Strategist Scott Chronert noted that while valuations remain high by historical standards, the optimism surrounding expected earnings growth tied to AI continues to support the market [1].

Why it matters

The current market environment reflects a tug-of-war between geopolitical instability and the perceived long-term growth potential of the artificial intelligence sector. While energy prices have surged due to fears regarding the Iran conflict, the "unprecedented" technology boom is currently offsetting those concerns [1]. Looking ahead, experts suggest the market could remain relatively flat in the coming months as investors balance the ongoing Middle East conflict against the sustained momentum of AI-linked earnings growth [1].