All three major US stock indexes hit new highs: Nasdaq leads, oil prices fall

May 28, Beijing time – US stocks rose on Wednesday, with all three major indexes hitting record highs. Micron Technology extended its epic rally. Oil fell on market hopes for a US-Iran ceasefire.

The Dow rose 182.60 points, or 0.36%, to 50,644.28; the Nasdaq rose 18.55 points, or 0.07%, to 26,674.73; the S&P 500 rose 1.24 points, or 0.02%, to 7,520.36.

The drop in oil provided support. US crude futures fell more than 5% to around $88 a barrel after reports that Iran state TV said the country committed to restoring commercial traffic through the Strait of Hormuz to pre-war levels within a month.

However, the White House denied the Iranian state media report, calling it "completely fabricated."

Micron Technology closed 3.6% higher. The stock surged 19% the previous day on an optimistic UBS report, pushing its market cap above $1 trillion for the first time.

UBS sees more than double upside as memory suppliers sign long-term agreements to drive AI adoption. Investors have turned to memory chip makers as a preferred way to participate in the AI bull market. Micron's South Korean peer SK Hynix also reached a $1 trillion market cap overnight.

The tech sector's gains drove broad indexes and the tech-heavy Nasdaq to fresh intraday and closing highs in the prior session. The S&P 500 rose 0.61% on Tuesday, and the Nasdaq surged 1.19%. The blue-chip Dow fell 118.02 points, or 0.23%.

Investors were also encouraged by President Trump's comments that negotiations to end the war with Iran were "going well." Despite a US "self-defense" strike early Tuesday in southern Iran, Central Command spokesman Tim Hawkins said the US showed restraint "during the ongoing ceasefire between the two countries."

Expectations of easing Iran tensions, along with a strong earnings season, pushed stocks to records this month. But Citigroup US equity strategist Drew Pettit sees limited room for further gains.

"Yields are high, the 10-year Treasury yield is around 4.50%, inflation expectations are rising, and the yield curve has actually flattened more this year. All these factors don't support sustainable higher valuation multiples at current levels," he said on CNBC Tuesday afternoon.

Pettit has a year-end target of 7,700 for the S&P 500, implying only a modest 2% upside.

Goldman Sachs disagrees. The bank raised its S&P 500 year-end target to 8,000 from 7,600 later Tuesday, citing continued strong earnings growth despite some geopolitical headwinds.