The S&P 500 (^GSPC +1.18%) and Nasdaq-100 indexes just hit all-time highs again.
Friday morning's gap-up gave the tech-heavy Nasdaq-100 a staggering 5%-plus gain for the week. That move wouldn't be a big deal for most stocks, but it's a massive gain for a market index with dozens of components.
The S&P 500 tagged along with a 2.3% weekly advance as of 1.20 p.m. ET, also landing in record territory for the third time this week.
The Dow Jones Industrial Average (^DJI +0.59%) is currently positive for the week, showing a modest 0.2% gain after spending Monday and Tuesday in the red.
Chips, jobs, and a blockbuster deal
The morning started with a pleasant surprise from the Labor Department. April's jobs report showed 115,000 new positions, nearly double the 65,000 economists had penciled in. Unemployment held firm at 4.3%. Analysts are still muttering about a "frozen" labor market, but investors didn't seem to care; they had bigger fish to fry.
I'm talking about semiconductors, of course.
Image source: Getty Images.
Chip-making veteran Intel (INTC +2.65%) exploded nearly 16% higher after The Wall Street Journal reported that the chipmaker has struck a preliminary deal to manufacture chips for Apple (AAPL 0.76%). Details are still unknown, but it's hard to find a better keystone customer to inspire more trust and interest in Intel's emerging Foundry division.
Not to be outdone, Micron (MU +0.90%) jumped more than 13% after a 2% dip on Thursday. Bernstein analysts published a bullish review of the memory-chip maker, highlighting its in-house manufacturing facilities amid AI-driven memory shortages.
The usual suspects joined the party. Nvidia added nearly 2%, which sounds modest until you remember it accounts for 12% of the Nasdaq-100. AMD (AMD +3.42%) popped 8%, Broadcom (AVGO +2.03%) climbed 4%, and Apple gained 1.6%, perhaps anticipating its new Intel-powered future. Generally speaking, Friday was a great day for semiconductors and AI stocks.
DJINDICES: ^DJI
Key Data Points
AI keeps winning, Iran is still a big concern
This week told a clear story: AI remains the market's favorite narrative, and nothing else comes close. Even the Iranian conflict seems unable to match the market-moving powers of AI hardware demand.
The Persian Gulf situation is getting messy, though. Despite the ongoing ceasefire and promising peace talks, both sides are taking aggressive action against cargo ships and oil tankers in the Strait of Hormuz. But investors seem content to file that under "tomorrow's problem" while they chase AI gains today.
For retail investors, the takeaway is familiar but worth repeating: the market keeps rewarding companies tied to artificial intelligence infrastructure, even when the macroeconomic backdrop looks uncertain. Whether that trade has legs or is running on fumes depends on continued high-quality earnings in the tech sector.
So far, tech earnings have delivered the goods. More reports are coming next week; let's see if the streak continues.
