US stock indices surged to all-time highs last week, driven by robust AI-related earnings, encouraging economic data, and a sharp decline in oil prices, according to Deutsche Bank. The S&P 500 rose 2.34% for the week, marking its sixth consecutive weekly gain, while the Nasdaq outperformed with a 4.30% advance. The Philadelphia Semiconductor Index skyrocketed 10.57%, underscoring the central role of chipmakers in the ongoing AI narrative.
Deutsche Bank attributed the rally to strong corporate profits linked to artificial intelligence, improving US data, and lower crude costs. The bank’s analysis noted that earnings strength is broadening beyond mega-cap tech, with early signs of AI-driven productivity gains spreading to financials and industrials. This dynamic has kept risk appetite firmly on, with investors willing to pay premiums for companies demonstrating tangible returns on AI investments.
Mixed economic signals kept bond yields nearly unchanged. April nonfarm payrolls beat expectations at 115,000, but average hourly earnings slowed to 3.6% from 3.8%, while the Michigan consumer sentiment index dipped to 48.2. The 10-year Treasury yield edged down to 4.36%, reflecting a wait-and-see stance on inflation. For crypto markets, the buoyant equity environment typically supports risk-on assets, potentially creating a favorable backdrop for digital currencies as long as rate expectations remain stable.
