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AI enthusiasm drove XLK and SMH higher as Dell's strong outlook fueled tech stocks.
Space stocks swung wildly amid SpaceX IPO buzz, while stagflation fears remained a key risk.
U.S. stocks closed at record highs on May 29, 2026 capping a strong month as investors cheered signs of progress in U.S.-Iran negotiations and another wave of AI-driven optimism sparked by strong corporate earnings. The S&P 500 posted its ninth consecutive weekly gain, marking its longest run since 2023, as quoted on Yahoo Finance.
Iran Deal Prospects Boost Market Sentiment
Investor sentiment improved after President Trump said he would soon make a "final determination" on a potential agreement with Iran.
Markets have responded positively since Trump indicated recently that negotiations were in their final stages. A successful agreement could help ease tensions surrounding the U.S.-Iran conflict and potentially reopen the Strait of Hormuz, a critical route for global oil shipments.
The prolonged disruption in the waterway has intensified inflation concerns by pushing energy prices higher, complicating the Federal Reserve's interest-rate outlook. United States Brent Oil Fund LP (BNO - Free Report) has lost about 13.6% over the past month.
AI Trade Continues to Drive Stocks Higher
Technology stocks remained a major force behind the market rally, supported by strong earnings and growing confidence in AI-related spending.
The technology sector has been the market's best performer since the March 30 lows, benefiting from heavy investment in AI infrastructure and data centers. State Street Technology Select Sector SPDR ETF (XLK - Free Report) surged 19.8% over the past month (as of May 29, 2026).
Dell Sparks Surge in AI Infrastructure Stocks
Shares of Dell Technologies (DELL - Free Report) soared as much as 32.8% after the company reported better-than-expected earnings and issued a bullish outlook.
Dell highlighted strong demand for AI servers powered by Nvidia chips and projected continued growth in data-center spending. The upbeat forecast reinforced investor confidence that AI infrastructure investment remains in its early stages.
The strong results also lifted other AI infrastructure providers, including Hewlett Packard Enterprise and Super Micro Computer, whose shares gained sharply following Dell's report.
Palantir Gains on Dell Partnership Validation
Shares of Palantir Technologies (PLTR - Free Report) jumped about 9% on May 29, 2026 after Dell's outlook underscored the potential of their recently announced partnership.
The collaboration integrates Palantir's software platforms into Dell's AI Factory powered by Nvidia technology, enabling enterprises to deploy AI applications and agents more efficiently, per the above-mentioned Yahoo Finance article.
Semiconductor Stocks Lead Monthly Advance
Semiconductor companies were among the biggest winners during the month as enthusiasm for AI-related hardware continued to build.
Micron Technology (MU - Free Report) surged more than 80% during the month, while Advanced Micro Devices gained over 40%. SanDisk also delivered strong gains, rising nearly 50%. VanEck Semiconductor ETF (SMH - Free Report) has added about 18.2% over the past month.
Seesaw in Space Stocks
Space-related stocks witnessed a massive rally in May as excitement builds around the highly anticipated IPO of SpaceX, which could become the largest public offering ever. According to The Wall Street Journal, the company is targeting a June 12 debut and could raise as much as $80 billion at a valuation near $2 trillion (read: Space Stocks Surge as SpaceX IPO Frenzy Builds).
However,space-related stocks sold off sharply on May 29, 2026 after a New Glenn rocket operated by Blue Origin exploded during a launchpad test at Cape Canaveral.
The incident weighed on a sector that had recently rallied ahead of the anticipated IPO of SpaceX. Procure Space ETF (UFO - Free Report) lost about 3.7% while Roundhill Space & Technology ETF (MARS - Free Report) retreated about 5.7% on May 29.
Rising Stagflation Risks
Meanwhile, sticky inflation and rising rate fears are acting as headwinds. A longer war-like scenario could push inflation significantly higher while slowing growth. Policymakers fear that sustained energy disruptions – especially via the Strait of Hormuz – may trigger stagflation, a worst-case scenario for the global economy.
The Federal Reserve’s preferred inflation measure accelerated to a three-year high in April, heightening concerns among policymakers and investors that price pressures are becoming more entrenched across the economy, as quoted on Yahoo Finance.
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Top ETF Stories of May 2026: Iran Deal Hopes, AI Rally
Key Takeaways
U.S. stocks closed at record highs on May 29, 2026 capping a strong month as investors cheered signs of progress in U.S.-Iran negotiations and another wave of AI-driven optimism sparked by strong corporate earnings. The S&P 500 posted its ninth consecutive weekly gain, marking its longest run since 2023, as quoted on Yahoo Finance.
Iran Deal Prospects Boost Market Sentiment
Investor sentiment improved after President Trump said he would soon make a "final determination" on a potential agreement with Iran.
Markets have responded positively since Trump indicated recently that negotiations were in their final stages. A successful agreement could help ease tensions surrounding the U.S.-Iran conflict and potentially reopen the Strait of Hormuz, a critical route for global oil shipments.
The prolonged disruption in the waterway has intensified inflation concerns by pushing energy prices higher, complicating the Federal Reserve's interest-rate outlook. United States Brent Oil Fund LP (BNO - Free Report) has lost about 13.6% over the past month.
AI Trade Continues to Drive Stocks Higher
Technology stocks remained a major force behind the market rally, supported by strong earnings and growing confidence in AI-related spending.
The technology sector has been the market's best performer since the March 30 lows, benefiting from heavy investment in AI infrastructure and data centers. State Street Technology Select Sector SPDR ETF (XLK - Free Report) surged 19.8% over the past month (as of May 29, 2026).
Dell Sparks Surge in AI Infrastructure Stocks
Shares of Dell Technologies (DELL - Free Report) soared as much as 32.8% after the company reported better-than-expected earnings and issued a bullish outlook.
Dell highlighted strong demand for AI servers powered by Nvidia chips and projected continued growth in data-center spending. The upbeat forecast reinforced investor confidence that AI infrastructure investment remains in its early stages.
The strong results also lifted other AI infrastructure providers, including Hewlett Packard Enterprise and Super Micro Computer, whose shares gained sharply following Dell's report.
Palantir Gains on Dell Partnership Validation
Shares of Palantir Technologies (PLTR - Free Report) jumped about 9% on May 29, 2026 after Dell's outlook underscored the potential of their recently announced partnership.
The collaboration integrates Palantir's software platforms into Dell's AI Factory powered by Nvidia technology, enabling enterprises to deploy AI applications and agents more efficiently, per the above-mentioned Yahoo Finance article.
Semiconductor Stocks Lead Monthly Advance
Semiconductor companies were among the biggest winners during the month as enthusiasm for AI-related hardware continued to build.
Micron Technology (MU - Free Report) surged more than 80% during the month, while Advanced Micro Devices gained over 40%. SanDisk also delivered strong gains, rising nearly 50%. VanEck Semiconductor ETF (SMH - Free Report) has added about 18.2% over the past month.
Seesaw in Space Stocks
Space-related stocks witnessed a massive rally in May as excitement builds around the highly anticipated IPO of SpaceX, which could become the largest public offering ever. According to The Wall Street Journal, the company is targeting a June 12 debut and could raise as much as $80 billion at a valuation near $2 trillion (read: Space Stocks Surge as SpaceX IPO Frenzy Builds).
However,space-related stocks sold off sharply on May 29, 2026 after a New Glenn rocket operated by Blue Origin exploded during a launchpad test at Cape Canaveral.
The incident weighed on a sector that had recently rallied ahead of the anticipated IPO of SpaceX. Procure Space ETF (UFO - Free Report) lost about 3.7% while Roundhill Space & Technology ETF (MARS - Free Report) retreated about 5.7% on May 29.
Rising Stagflation Risks
Meanwhile, sticky inflation and rising rate fears are acting as headwinds. A longer war-like scenario could push inflation significantly higher while slowing growth. Policymakers fear that sustained energy disruptions – especially via the Strait of Hormuz – may trigger stagflation, a worst-case scenario for the global economy.
The Federal Reserve’s preferred inflation measure accelerated to a three-year high in April, heightening concerns among policymakers and investors that price pressures are becoming more entrenched across the economy, as quoted on Yahoo Finance.