US Stocks Rise, Markets Remain Monitoring Middle East Direction
US stocks closed higher on Tuesday (May 26), with the S&P 500 rising 0.6% and the Nasdaq up 1.2% to a new record, while the Dow Jones Industrial Average fell 118 points. The moves occurred as investors returned from a long holiday with their primary focus remaining on developments in the conflict and diplomacy in the Middle East.
Market sentiment tended to be cautiously optimistic. Market participants believed the US and Iran still had a chance to reach an agreement, with both sides perceived as being closest to a deal despite mixed signals and renewed attacks. This narrative maintained risk appetite, but was not strong enough to lift all sectors evenly.
The gains were led by the technology, industrials, and materials sectors, while energy and consumer staples recorded the deepest declines. This shift is consistent with a selective risk-on pattern: investors increase exposure to growth and cyclical sectors, but reduce positions in energy while oil price volatility and headline risk remain high.
In terms of individual stock movements, Micron Technology surged 19.3%, its market capitalization surpassing US$1 trillion for the first time after UBS raised its price target and said the stock has potential for further upside. Alphabet rose 1.4%, Broadcom 1.9%, and Tesla 1.8%. Meanwhile, Nvidia fell 0.2%, while Microsoft and Amazon fell 0.6% and 0.4%, respectively. Exxon Mobil fell 3.3%, and Walmart weakened 1.4%.
The next variables the market will be monitoring are the continuation of Middle East headlines that shape energy prices and risk sentiment, as well as whether sector rotation persists or widens again as investors reassess the inflation outlook and interest rate policy.
Source: Newsmaker.id
