Wall Street Rises, AI and Chip Stocks Become the Driving Force

The United States stock market, or Wall Street, closed higher on Monday (11/5/2026) trading, driven by optimism towards artificial intelligence (AI) developments, although the market remains overshadowed by inflation concerns due to rising oil prices and the stagnation of peace negotiations between the US and Iran. The three main Wall Street indices closed in positive territory. In fact, the S&P 500 and Nasdaq indices once again recorded new all-time closing highs. Citing Reuters on Tuesday (12/5/2026), the Dow Jones Industrial Average rose 95.31 points or 0.19 percent to 49,704.47. Meanwhile, the S&P 500 strengthened by 13.91 points or 0.19 percent to 7,412.84, while the Nasdaq Composite rose 27.05 points or 0.10 percent to 26,274.13. Of the 11 major sectors in the S&P 500 index, energy sector stocks recorded the largest gains. Conversely, the communications services sector was the most lagging. Baird investment strategy analyst Ross Mayfield said that semiconductor and AI infrastructure stock trading now has tremendous momentum. “The momentum in the AI and chip sector seems to be running on its own, regardless of news sentiment or specific announcements,” Mayfield stated. Nevertheless, some market participants are beginning to warn of potential market corrections. Investor Michael Burry, known for successfully predicting the 2008 financial crisis, warned that the technology stock rally could soon end. In his writing on the Substack platform, Burry assessed that the current market is already too hot. “The market has exceeded its limits,” he wrote. Analysts now estimate that earnings for S&P 500 member companies will grow 28.6 percent annually in Q1-2026, far higher than the initial April projection of only 14.4 percent. U.S. Bank Wealth Management Chief Equity Strategist Terry Sandven said the current market rally is mainly supported by solid corporate earnings growth. However, investor attention is starting to shift back to macroeconomic and geopolitical factors as the financial reporting season ends.