US stock futures rally on Middle East peace hopes, AI optimism

By Niket Nishant and Utkarsh Hathi

Wall Street futures rose on Wednesday, extending a strong run on hopes of a potential U.S.-Iran peace agreement and unrelenting optimism around artificial intelligence.

The rally, which propelled the S&P 500 and the Nasdaq Composite to record highs on Tuesday, showed few signs of easing after Advanced Micro Devices forecast second-quarter revenue above expectations, driven by robust demand for its data-center chips.

"Wall Street continues to double down on its bet that the war in the Middle East will not re-escalate and disrupt the market's earnings-driven surge to all-time highs," said Kyle Rodda, senior financial market analyst at Capital.com.

"There's a high risk that if that wager is wrong, risk assets would move sharply in reverse. However, the signals sent from the United States appear to offer reassurance that it's not interested in renewing hostilities."

The U.S. and Iran are closing in on an agreement on a one-page memorandum to end the war, a Pakistani source said.

Axios reported that in its current form, the memorandum would declare an end to the conflict and the start of a 30-day period of negotiations on a detailed agreement to open the Strait of Hormuz, limit Iran's nuclear program and lift U.S. sanctions.

Oil prices fell to a two-week low, with Brent crude futures slipping 7.7%.

The gains in equities reflect rising risk appetite among investors - if corporate earnings remain strong and hopes for a peace deal stay alive.

At 6:02 a.m. ET, Dow E-minis rose 442 points, or 0.89%, S&P 500 E-minis gained 59.75 points, or 0.82%, and Nasdaq 100 E-minis were up 399.75 points, or 1.42%.

AMD jumped 18% in premarket trading, while rival Intel rose 5.7%. Super Micro soared 15% following a stronger-than-expected forecast for fourth-quarter revenue and adjusted profit.

Alphabet surged 2.1%, narrowing the gap with Nvidia in the race to become the world's biggest company by market value. Nvidia rose 1.7%.

Arm Holdings gained 11.5% ahead of its quarterly results.

(Reporting by Niket Nishant and Utkarsh Hathi in Bengaluru; Editing by Arun Koyyur and Pooja Desai)

Copyright Reuters or USA Today Network via Reuters Connect.

This story was originally published May 6, 2026 at 6:32 AM.