A second consecutive ATH — and a chip rip behind it
Wednesday extended Tuesday’s rally with conviction: the S&P printed back-to-back records, the Nasdaq punched through 25,800 on its biggest day in six weeks, and AMD ripped 18.61% — its largest single-session move since 2022. The Russell 2000 set a new record alongside; the rally had breadth.
7,365.12
S&P 500 (Wed close)
+1.46% · second consecutive ATH
25,838.9
Nasdaq (Wed close)
+2.02% · AI capex on full throttle
$421.39
AMD (Wed close)
+18.61% · biggest single-day rip in 4 years
$107.51
Brent (Wed close)
−2.15% · MoU keeps the bid faded
Markets ground higher on a 1-page MoU; AMD did the rest
The Iran deal framework circulating Wednesday is a single-page memorandum: halt enrichment, extract the existing uranium stockpile, lift US sanctions, reopen the Strait of Hormuz, and a Lebanon ceasefire. A monthlong negotiating window for the detailed agreement follows on signature. Iran’s response is expected within 48 hours; Trump kept the bracket — “the bombing starts, and at a much higher level” if Tehran walks. Pakistani and Omani back-channels remain the conduit.
Risk assets read the framework as deliverable and the rally broadened. AMD ripped 18.61% to $421.39 on the strongest data-centre print in the company’s history; the SOX added 5%, Micron printed a fresh ATH, and the AI-capex narrative now sits behind a $715B combined-hyperscaler 2026 spend. Brent settled −2.15% at $107.51 as throughput rose to ~7 mb/d, gold drifted lower on the firmer risk-on bid, and the 10-year added 2 bps as the Fed-cut path moderated.
The cross-asset scoreboard
Risk-on with breadth: every major index green, oil lower with throughput rising, dollar softer on the de-escalation, crypto in tow. The long-end backed up two basis points as the inflation premium added Tue partially returned — the curve is still pricing September.
+1.46%
S&P 500 (Wed close)
7,365.12 · second consecutive ATH
+2.02%
Nasdaq (Wed close)
25,838.9 · biggest day in six weeks
−9.42%
VIX
14.42 · vol compressed further
+2 bps
US 10-Yr
4.39% · long end backs up
| S&P 500 | 7,365.12 | +1.46% |
| Nasdaq | 25,838.94 | +2.02% |
| Dow Jones | 49,910.59 | +1.24% |
| Russell 2000 | 2,857.94 | +1.20% |
| VIX | 14.42 | −9.42% |
| Stoxx 600 | 618.34 | +1.07% |
| FTSE 100 | 8,792.50 | +0.85% |
| Nikkei 225 | 42,114.60 | +1.05% |
| Hang Seng | 26,612.40 | +1.01% |
| KOSPI | 7,008.20 | +0.63% |
| Brent Crude | $107.51 | −2.15% |
| WTI Crude | $99.92 | −2.13% |
| Gold | $4,531.20 | −0.37% |
| Silver | $72.94 | −0.65% |
| Nat Gas (NYMEX) | $5.07 | −2.69% |
| 2-Yr Treasury | 3.81% | +2 bps |
| 10-Yr Treasury | 4.39% | +2 bps |
| 30-Yr Treasury | 4.99% | +2 bps |
| Bund 10-Yr | 2.62% | +3 bps |
| UAE 10-Yr spread | — | −9 bps |
| US Dollar Index | 98.05 | −0.16% |
| EUR / USD | 1.0782 | +0.12% |
| USD / JPY | 151.34 | −0.22% |
| USD / AED | 3.6725 | 0.00% |
| Bitcoin | $83,140 | +2.11% |
$715B of hyperscaler capex — the buyer behind AMD
Combined 2026 capex guidance from Amazon, Microsoft, Alphabet and Meta has reached $715B — up 73% from 2025’s $367B. Amazon is the largest single buyer at $200B; Meta is growing fastest at +88% YoY. AMD’s Q1 print sits squarely inside this curve: when hyperscaler capex doubles, every chip designer with a credible AI accelerator wins.
| Amazon | $200B (2026) | +92% |
| Microsoft | $190B (2026) | +116% |
| Alphabet | $190B (2026) | +84% |
| Meta | $135B (2026) | +88% |
| Combined | $715B (2026) | +95% |
The largest capex cycle in tech history — bigger than the dotcom build-out in inflation-adjusted dollars. The trade isn’t long any single chip name; it’s long the cap-equipment supply chain that hasn’t fully repriced yet.
What else matters today
AI Capex
AMD +18.6% drags the SOX +5% and Micron to fresh ATH
AMD's regular-session reaction more than confirmed Tuesday's after-hours: $421.39 close, +18.61%, the largest single-session rip since 2022. Read-through hit Micron (+8%, fresh ATH on HBM demand), Marvell (+6%), and the cap-equipment trio — LRCX, KLAC, ASML — all up 4–5%. The SOX added 5.1%, its biggest day this year.
Yahoo Finance · TheStreet · Wed 6 May
Geopolitics
Iran 1-page MoU under review — response within 48 hours
The single-page framework on Tehran's desk: halt enrichment, extract the uranium stockpile, lift sanctions, reopen Hormuz, Lebanon ceasefire — followed by a 30-day window to negotiate the detailed agreement. Pakistani and Omani back-channels are the conduits. Trump's threat ("bombing at a much higher level") sits as the negotiating bracket; markets are discounting it.
Times of Israel · Al Jazeera · CNBC · Wed 6 May
Macro
September cut now at 65% — but the long end stayed firm
OIS extended Tuesday's rate-cut re-pricing: September now at 65% (up from 35% Mon, 60% Tue). The 2-year fell another 1 bp; the 30-year added 2 bps as the inflation premium partly returned with the AI capex story. Powell speaks Thu before his 15 May exit; Warsh's full Senate vote sits next week.
CME FedWatch · Bloomberg · Wed 6 May
GCC re-rates higher as the MoU framework circulates
DFM extended Tuesday’s bid to a +1.4% close Wednesday, ADX +1.0% on banking and Aramco-adjacent names. The UAE 10-year eurobond spread tightened a further 9 bps — now 15 bps inside its pre-crisis level for the first time since the war began. Saudi 5-year CDS fell to 64 bps from 92 bps on Monday morning. Foreign-flow data shows the largest single-day GCC inflows in six months.
Riyadh and Abu Dhabi have been visibly active in the back-channel — both governments have framed the Hormuz reopening as a regional priority. The MoU framework, if signed, would unwind most of the war’s risk premium across GCC assets in two to three sessions. Hormuz throughput is up to ~7 mb/d but still RESTRICTED, not OPEN — the indicator only flips on signature.
Brent in dirhams
AED 394.78
−2.2% from Tue · still +28% YTD
DFM Index (Wed close)
+1.4%
Two-day rally · banking led both sessions
UAE 10-yr eurobond
−9 bps
Inside pre-crisis level for the first time
Saudi 5-yr CDS
64 bps
From 92 bps Monday morning
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Three trades behind the rip
Two days of records on top of a 1-page MoU that hasn’t been signed. The setup behind the prints is more interesting than the prints themselves.
01 · Cap-equipment
Cap-equipment is the lagged trade
When chip designers (NVDA, AMD, AVGO) re-rate on hyperscaler capex, the equipment supply chain — Applied Materials, Lam Research, KLA, ASML — tends to follow on a one-quarter lag. With $715B of 2026 capex now visible, the half-cycle for fab equipment is at least 18 months. AMAT and ASML still trade at 2-year P/E discounts to NVDA. That gap is the trade.
02 · The MoU
The MoU is the only thing left to deliver
Equities have priced both Project Freedom's pause and a deal framework that hasn't been signed. If Iran agrees within 48 hours, the Hormuz indicator flips OPEN and Brent fades another 5–8% — the marginal mover is then Fed not Middle East. If Iran walks, every move since Tuesday afternoon reverses, fast. Position-size for both outcomes; don't over-anchor on either.
03 · Powell
Powell speaks tomorrow
The Fed chair has one prepared speech left before his 15 May exit, on a panel Thursday afternoon. With OIS now pricing 65% odds of a September cut and Warsh's Senate vote next week, Powell's tone — not his text — sets the long-end direction for the rest of May. Stay duration-light into the print; positioning for a hawkish parting note remains underowned.
Markets are now pricing a deal that hasn’t been signed — and an AI capex cycle that has. One of those is far easier to underwrite than the other.