Oil Hits $104, Reaching All-Time High... What’s Wall Street's Real Reason for Holding Steady?
On Monday, May 11 (New York time), U.S. equity markets edged higher again, setting fresh records. The S&P 500 rose 0.2% to 7,412.84, the Dow gained 0.2% to 49,704.47, and the Nasdaq added 0.1% to 26,274.13. The small- and mid-cap Russell 2000 also climbed 0.3%, reflecting sustained risk-on sentiment.
All day long, markets were driven by escalating Iran tensions and crude oil prices. Brent crude jumped 2.9%, topping $104 a barrel, after President Trump rejected Iran’s ceasefire proposal—likening a ceasefire to “life support”—which reignited inflation concerns. At the same time, he said he would push to temporarily suspend the federal gas tax, a move that buoyed energy and refining stocks while putting pressure on transportation and consumer sectors.
The Federal Reserve remains a key wild card. After holding its benchmark rate at 3.50–3.75%, the Fed reiterated that rate cuts will not come easily, and major investment banks have delayed their forecasts for the first cut, citing rising oil prices and robust employment. If tomorrow’s (May 12) April Consumer Price Index prints hotter than expected, climbing Treasury yields could renew valuation pressure on growth stocks.
On the corporate front, strong first-quarter earnings and an AI investment boom underpinned the rally in semiconductors and big tech. Intel gained after confirmation of an exclusive chip-manufacturing deal with Apple, and AI-related names such as Nvidia and AMD extended their gains. By contrast, ad-tech company The Trade Desk and discount retailer Dollar General plunged about 7% each on disappointing results and guidance, highlighting both a slowdown in the advertising market and strain on lower-income consumers.
In sum, today’s U.S. market eked out a victory in the tug-of-war between oil shocks and geopolitical risk on one side and AI-driven momentum and earnings strength on the other. For Korean investors, tomorrow’s CPI release, upcoming Fed remarks and Iran-related geopolitics will be critical in determining which force will break the balance.