Semiconductors posted their biggest daily gain in a month as hedge funds scrambled to rebuild positions ahead of mega-cap earnings, but Brent crude topped $91 after Houthis threatened a Saudi Red Sea blockade and the US completed a tenth day of strikes on Iran.
US airstrikes on Iran hit a tenth straight day with three soldiers dead and Houthis threatening a Saudi Red Sea blockade. Brent crude breached $90, the S&P 500 slipped 0.2%, and UK gilt yields surged after PM Burnham’s surprise Chancellor pick rattled markets.
The S&P 500 fell 0.05% to 7,353.95 as the chip index plunged 5.3%, capping a week that saw the Nasdaq shed 4.6%. Weekend tit-for-tat strikes between the U.S. and Iran in the Strait of Hormuz have reignited ceasefire fears ahead of Tuesday’s Doha talks. The BIS warned that record debt, AI overinvestment and financial fragilities are building systemic risks.
The week that closed the first half of 2026 delivered something more interesting than a directional market move: it forced a clarification. The AI trade is not over. It’s just been redrafted. The hyperscalers — companies spending hundreds of billions to build the infrastructure — are getting sold. The companies supplying that infrastructure at margins they can barely keep up with are getting bought. Micron’s blowout quarterly result, released Wednesday night, was the exclamation mark on a week that started with the “Chip Wreck” and ended with a very different conversation.
Micron’s blowout AI-driven earnings sent the memory chipmaker surging 16% and briefly past Meta and Tesla by market cap, but Apple’s aggressive price hikes to absorb soaring component costs dragged the Magnificent Seven lower and left the S&P 500 flat. May core PCE held at 3.4% year-on-year — in line with expectations — while oil rebounded after an attack on a cargo ship in the Strait of Hormuz complicated the fragile US–Iran peace deal.
Wall Street’s rebound attempt fizzled as tech weakness dragged the Nasdaq lower, but Micron’s blowout after-hours guidance reignited AI confidence. Brent crude hit its lowest since the day before the Iran war began as Hormuz shipping normalised, sending Treasury yields sharply lower. ASX 200 futures point modestly higher ahead of May employment data.
Global stocks stalled as US-Iran peace talks opened at Bürgenstock amid fresh Trump threats over Hezbollah and renewed Strait of Hormuz uncertainty. The Fed’s hawkish pivot under new Chair Kevin Warsh saw the dot plot flip to signal rate hikes before year-end, with May CPI at 4.2%. ASX 200 futures point 0.2% lower with BHP’s Jansen cost blowout and Australian May CPI data on Wednesday the key domestic catalysts.