S&P 500 Gains Unleashed on Chip Stock Strength, Falling Oil and Return to Optimism

The S&P 500 reached a fresh record above 7,300 on Wednesday, marking a 7.6% year-to-date gain and a 15% rally from March lows. AI-driven earnings, reduced Iran-U.S. tensions, and softer crude prices below $100 per barrel fueled the market’s optimism. Advanced Micro Devices (AMD) led gains with a 19% jump to $421 after reporting Q1 revenue of $10.25 billion and non-GAAP EPS of $1.37, exceeding estimates. Data center revenue soared 57% to $5.78 billion, with CEO Lisa Su forecasting Q2 revenue near $11.2 billion and projecting a $120 billion CPU market by 2030. NVIDIA (NVDA) also rose 6% to $208 on strong AI infrastructure demand. The broader earnings season outperformed expectations, with Deutsche Bank calling it one of the strongest in two decades. S&P 500 profit growth neared 25%, double the historical average outside recessions, while beat rates exceeded long-term norms. Initial jobless claims at 200,000 reinforced labor market strength, bolstering investor confidence. Shell reported Q1 adjusted earnings more than doubled to $6.92 billion but warned of production disruptions from the Pearl GTL attack, causing shares to dip 3%. Meanwhile, McDonald’s (MCD) delivered EPS of $2.83 and 4% global comps, while Warner Bros. Discovery (WBD) faced a $1.17 per-share loss due to a $2.80 billion Netflix termination fee. Anthropic’s CEO Dario Amodei revealed 80x annualized revenue growth in Q1, far exceeding projections, highlighting AI’s rapid adoption. Upcoming earnings from Coinbase, Airbnb, and Datadog, along with Fed policy and Iran developments, will influence market momentum.