US Indices Hit Record Highs in May Driven by AI Boom and Earnings

Key Facts

1All three major US indices closed May at record highs despite rising global yields.

2The Nasdaq Composite gained 8.4% during the month of May.

3The S&P 500 rose approximately 5% for the month, supported by the tech sector.

All three major US indices concluded May at record highs, successfully navigating the headwinds of rising global yields. The Nasdaq Composite led the rally with an 8.4% monthly gain, while the S&P 500 rose approximately 5% on the back of a dominant technology sector performance. This momentum underscores investor confidence in robust corporate earnings and the sustained investment boom surrounding artificial intelligence hardware and software.

The market's resilience coincided with key economic prints, including the Core PCE Price Index which rose 0.2% in May per market data, slightly below the 0.3% forecast. Additionally, the Q1 GDP growth rate was confirmed at 1.6% (as of May 28, 2026), which, despite being lower than the 2% forecast, suggested a cooling economy that might eventually allow the Fed more flexibility regarding interest rate adjustments.

Looking ahead, investors are focusing on whether the S&P 500 can maintain its trajectory above record levels established at the close of May 2026. Key catalysts to watch in the coming week include major US labor market data, especially after initial jobless claims reached 215k (reported May 28, 2026), which will provide further clarity on the health of the consumer economy and future Fed policy.