Wall Street Climbs as Micron Leads Chip Stock Rally Amid Iran Peace Hopes

U.S. stock markets closed mostly higher on Tuesday as semiconductor stocks surged, driven by a massive rally in Micron Technology. Investor sentiment improved after reports suggested progress toward a potential peace agreement between the United States and Iran, although renewed military tensions in the Middle East limited gains.

The S&P 500 rose 0.6% to reach a record close of 7,519.47, while the Nasdaq Composite jumped 1.2% to finish at an all-time high of 26,656.18. In contrast, the Dow Jones Industrial Average slipped 0.2%, weighed down by losses in Chevron and UnitedHealth shares.

Technology stocks outperformed, with Micron Technology soaring more than 19% after UBS sharply increased its price target for the company. The rally pushed Micron’s market capitalization above $1 trillion for the first time, highlighting continued investor enthusiasm surrounding artificial intelligence and memory chip demand. The Philadelphia Semiconductor Index also hit a record high as chipmakers benefited from strong momentum in the AI sector.

Markets initially reacted positively after President Donald Trump stated that a memorandum related to a peace agreement with Iran had been “largely negotiated.” However, geopolitical concerns resurfaced after U.S. forces carried out defensive strikes in southern Iran following threats in the Strait of Hormuz. Oil prices rebounded, with Brent crude climbing above $99 per barrel.

Meanwhile, investors closely monitored the bond market ahead of the upcoming U.S. core PCE inflation report, the Federal Reserve’s preferred inflation gauge. Treasury yields declined slightly after recent volatility caused by rising inflation concerns and higher oil prices. Analysts also noted that growing U.S. government debt and increased Treasury issuance continue to pressure fixed-income markets.