US stocks: S&P 500, Nasdaq at record highs as oil pullback brings relief

Published Thu, May 7, 2026 · 10:40 PM

THE S&P 500 and the Nasdaq held close to record highs on Thursday, helped by an extended fall in oil prices on hopes of a US-Iran deal that could potentially normalise crude supplies through the Strait of Hormuz.

The United States and Iran are edging toward a limited, temporary agreement to halt their war, sources and officials said, with growing optimism that it could pave the way for the narrow waterway – a vital artery for global energy and trade – to open.

Teheran is expected to respond to the peace proposals.

Global stocks climbed to record peaks while oil prices were down about 4 per cent, receding further from US$100 a barrel.

“I’d be surprised if this conflict lasts. If it does, it’s because the Iranians want to keep it lasting. I think Trump wants to get this resolved,” said Robert Pavlik, senior portfolio manager at Dakota Wealth.

A relentless rally in technology and AI shares has also played a big role in pushing US stocks to fresh highs as investors cheered signs of strong demand for artificial intelligence, a robust earnings season and upbeat economic data.

The tech rally appeared to stall somewhat on Thursday, with US-listed shares of Arm Holdings sliding 6.9 per cent as worries about the company’s ability to secure sufficient supplies for its new AI chip overshadowed a strong earnings forecast.

Shares of Intel dropped 3.3 per cent, while Advanced Micro Devices fell 2 per cent.

At 9.40 am ET, the Dow Jones Industrial Average rose 39.22 points, or 0.08 per cent, to 49,949.81, the S&P 500 gained 5.43 points, or 0.07 per cent, to 7,370.55, and the Nasdaq Composite added 79.70 points, or 0.31 per cent, to 25,918.64.

Six of the 11 main S&P 500 sectors were in the red, with energy leading declines with a 2.1 per cent drop.

Data showed the number of Americans filing claims for unemployment benefits rose less than expected last week amid low layoffs that are helping anchor the labour market.

After a strong private payrolls report on Wednesday, investors are awaiting the more comprehensive nonfarm payrolls numbers on Friday, with jobs seen increasing by 62,000 in April after rebounding 178,000 in March, according to a Reuters poll of economists.

Traders continued to bet the US Federal Reserve would hold interest rates steady through the end of the year due to a resilient labour market and elevated energy prices. That is a stark shift from several rate cuts investors priced in before the war.

Fed presidents Neel Kashkari of Minneapolis and Beth Hammack of Cleveland as well as New York head John Williams – all voting members of the interest-rate-setting committee this year – are scheduled to speak later in the day.

In other movers, cybersecurity stocks gained after Datadog raised its full-year earnings forecast. Datadog surged 30 per cent, while peers CrowdStrike and Palo Alto Networks added 4.8 per cent and 6.4 per cent, respectively.

Snap dipped 2.2 per cent after the Snapchat parent said its first-quarter advertising revenue was impacted by the Middle East conflict and slowing growth in North America.

Whirlpool slumped 13 per cent after the home-appliance maker missed first-quarter sales estimates and suspended its dividend.

Advancing issues outnumbered decliners by a 1.07-to-1 ratio on the NYSE and by a 1.09-to-1 ratio on the Nasdaq.

The S&P 500 posted 13 new 52-week highs and eight new lows, while the Nasdaq Composite recorded 73 new highs and 34 new lows. REUTERS