NEW YORK, May 8, 2026, 16:06 EDT
Shares tied to artificial intelligence chips surged, helping push the S&P 500 up 0.83% to 7,397.72 and lifting the Nasdaq by 1.54% to a new high at 26,202.53 on Friday. Both indexes locked in fresh records, even as oil prices climbed again. The Dow Jones Industrial Average, meanwhile, managed just a 0.04% gain, finishing at 49,618.14. A stronger-than-expected jobs report added momentum.
This shift is significant, with Wall Street essentially betting that robust corporate earnings and continued AI investment will keep stocks aloft—even as rising energy costs pose fresh inflation risks. The S&P 500 now sits over 15% higher than its late-March low. Looking ahead, investors are bracing for key reports on inflation, producer prices, and retail sales due next week.
Investors had reason to keep their bets on Friday after the jobs report landed. Nonfarm payrolls grew by 115,000 in April, and unemployment stuck at 4.3%, according to the Bureau of Labor Statistics.
Rob Williams, chief investment strategist at Sage Advisory Services, put it bluntly: “This is an economy that seems hard to wreck.” Economists surveyed by Reuters were looking for a 62,000-job increase, but the actual report ended up giving traders more reasons to believe the Federal Reserve would leave rates unchanged for a while. Reuters
Most of the heavy lifting came from tech. Nvidia added 1.8%. Micron Technology and Sandisk, both in memory and storage, surged roughly 12% apiece—riding a wave of demand from AI data center expansion. The Philadelphia semiconductor index popped nearly 5%, pushing its second-quarter advance up to 54%.
It wasn’t a wide rally. Breadth remained spotty—six out of 11 S&P 500 sectors slipped, healthcare stocks dropped the most, and losers on the S&P 500 just edged out winners.
Earnings continued to underpin the market. First-quarter S&P 500 profits look set to climb nearly 29% year-on-year, with 83% of the 440 firms that have posted results so far beating analyst expectations, LSEG data showed, as reported by Reuters.
RBC Capital Markets ramped up its optimism ahead of the bell, bumping its S&P 500 year-end forecast to 7,900—up from 7,750. The firm pointed to ongoing earnings strength and momentum in AI-related names as drivers. It also shifted its stance on healthcare, dropping the sector to “market weight” from “overweight.” Reuters
Cloudflare slumped, hit by a second-quarter outlook that fell short of what investors wanted to see. CoreWeave lost ground too, after it bumped up the low end of its full-year capex guidance to reflect pricier components. The Trade Desk and Expedia also slipped on softer projections.
The takeaway on rates wasn’t clear-cut. Adam Sarhan, CEO at 50 Park Investments, described the jobs report as “not too hot and not too cold.” Spartan Capital Securities’ chief market economist, Peter Cardillo, saw it as a signal that the Fed should “concentrate on inflation” and not the labor market. Reuters
The bigger worry right now: inflation could flare up, overshadowing jobs. Brent crude pushed past $100 per barrel, with little optimism for a swift reopening of the Strait of Hormuz. Attention shifts to next week’s consumer price index—especially the core figure, which leaves out food and energy.
“Markets have ‘willed themselves to focus on only the positive,’” said Kristina Hooper, chief market strategist at Man Group. On the flip side, Michael Arone, chief investment strategist at State Street Investment Management, boiled it down: “Earnings are the lifeblood of this rally.” Reuters
With Friday’s finish, the S&P 500 and Nasdaq were staring at six straight weeks in the green—their longest climb since October 2024. The Dow, not far behind, eyed a second week of gains. After hours, the message was concise: AI momentum and earnings continue to steer the action, unless oil or inflation steps in to change the script.
