Wall Street gains as chips rebound, Middle East tensions ease

Wall Street’s major indexes rose on Monday as chipmakers rebounded from last week’s selloff, while easing Middle East tensions and strong jobs data supported investor sentiment. Intel shares surged 8.5% after reports of Alphabet’s in-house chip order, while the S&P 500 and Nasdaq gained 0.68% and 1.09%, respectively, amid AI-driven optimism and reduced geopolitical risks." "article": "Wall Street’s major indexes climbed on Monday, driven by a rebound in chipmakers after a sharp selloff that erased $1 trillion in market value last week. Intel shares jumped 8.5% following reports that Alphabet had contracted the company to produce 3 million custom chips, while Nvidia and Broadcom rose 1.7% and 2.8%, respectively. Micron Technology led gains with an 8.7% increase, and the Philadelphia SE Semiconductor index advanced 4.6%, reversing Friday’s losses. The S&P 500 tech sector index gained 1.9%, and four of the 11 major S&P 500 indexes finished in positive territory. Investor confidence was further boosted by easing tensions in the Middle East, where Iran announced its first wave of attacks on Israel since April was over. Israel reportedly halted strikes on Iran following a request from U.S. President Donald Trump, reducing oil price volatility, which had spiked over 5% earlier in the day. Market movements were also influenced by stronger-than-expected May jobs data, which increased expectations of Federal Reserve rate hikes. Futures pricing suggested a 42% chance of a 25-basis-point rate increase by December, according to CME Group’s Fedwatch tool. Meanwhile, Citigroup raised its 2026-end S&P 500 target to above 8,000, citing resilient corporate earnings and AI-driven growth. Among other movers, Marvell Technology surged nearly 10% ahead of its inclusion in the S&P 500 index on June 22, while Flex saw marginal gains. Eli Lilly advanced 2.3% after trial results showed its obesity drug retatrutide reduced sleep apnea severity alongside weight loss benefits. The Nasdaq Composite recorded 47 new highs and 57 new lows, with advancing issues outnumbering decliners by a 1.97-to-1 ratio. Market strategists noted that chip sector volatility reflects overvaluation concerns, with traders rotating investments into other areas. Wednesday’s May consumer price report will provide further clarity on inflation pressures, particularly from rising energy costs tied to Middle East tensions. Despite lingering geopolitical risks, AI optimism and corporate earnings resilience continue to underpin Wall Street’s record run.