Nasdaq, the rally starts running again

Nasdaq, the rally starts running again

AI, earnings and geopolitics push Wall Street to new highs

The Nasdaq week began with a false start and quickly turned into a renewed bullish acceleration. After Monday’s slight pullback, the U.S. technology market regained momentum thanks to three converging factors: solid corporate results, renewed enthusiasm around artificial intelligence, and a reduction in the geopolitical risk premium linked to the Middle East.

The Nasdaq Composite closed on May 6 at 25,838.94 points, up 2.0% on the day and 2.9% for the week, while its year-to-date gain stands at 11.2%. The Nasdaq 100 also reached a new high, closing at 28,599.17 points: compared with 27,710.36 points on May 1, the weekly gain was around +3.2%.

The engine of the rally: semiconductors, AI and earnings above expectations

The heart of the move remains the AI trade. The May 6 session was dominated by AMD, which rose 18.6% to $421.39 after quarterly results exceeded expectations and guidance was supported by demand for data-center chips. In the first quarter of 2026, the company reported revenue of $10.3 billion, a GAAP gross margin of 53%, net income of $1.4 billion and diluted EPS of $0.84; on a non-GAAP basis, EPS was $1.37.

The reaction was broad across the entire sector. Nvidia closed at $207.83, up 5.7% on the day; Intel at $113.01, up 4.5%; and Super Micro Computer at $34.66, up 24.7%. The Philadelphia Semiconductor Index gained 4.5%, confirming that the market continues to price in structural demand for AI infrastructure, servers and data centers.

Among mega-caps, leadership remains broad-based: Apple closed at $287.51, up 1.15%; Microsoft at $413.96, up 0.62%; Alphabet at $398.04, up 2.43%; Meta at $612.88, up 1.26%; Amazon at $274.99, up 0.52%; and Tesla at $398.73, up 2.39%. What matters is not only the daily gain, but the quality of the move: the market is rewarding earnings growth, visibility on AI demand, and the ability to sustain high margins despite more complex energy costs and supply chains.

Earnings: the market buys growth, margins and visibility

The earnings season has provided fuel for the rally. According to Reuters, more than 80% of S&P 500 companies that had reported results by May 1 beat earnings estimates, with the market on track for its strongest profit growth in more than four years.

Within Big Tech, Apple reported quarterly revenue of $111.2 billion, up 17% year on year, and diluted EPS of $2.01, up 22%. The group benefited from record revenue in the March quarter and an all-time high in services.

Microsoft closed fiscal third quarter 2026 with revenue of $82.9 billion, up 18%, operating income of $38.4 billion, up 20%, net income of $31.8 billion, up 23%, and diluted EPS of $4.27. The key driver remains the combination of cloud and AI.

Alphabet recorded consolidated revenue of $109.9 billion, up 22%, with Google Cloud growing 63% and backlog almost doubling to more than $460 billion. This is an important signal: the market is assigning value not only to digital advertising, but also to the infrastructure monetization of AI.

Meta reported first-quarter 2026 net income of $26.8 billion, up 61%, and diluted EPS of $10.44, up 62%. Although the figure was influenced by tax-related components, it confirms the group’s strong cash-generation capacity.

Geopolitics: relief comes from oil

The second major catalyst was geopolitical. Hopes of a possible de-escalation between the United States and Iran reduced the risk premium on energy, with Brent crude sharply falling below the $102-a-barrel area during some phases of trading. The prospect of a reopening or normalization of flows through the Strait of Hormuz supported equities, bonds and sectors sensitive to energy costs.

The market’s interpretation is simple: lower energy risk means less pressure on inflation, industrial margins and rate expectations. However, the picture remains fragile. The Federal Reserve Bank of New York reported that its Global Supply Chain Pressure Index rose in April to 1.82 from 0.68 in March, the highest level since July 2022, precisely because of tensions in the Middle East.

Macroeconomics: resilient growth, inflation still uncomfortable

On the macro front, the picture is mixed but still compatible with a risk-on environment. U.S. real GDP grew in the first quarter of 2026 at an annualized rate of 2.0%, supported by investment, exports, consumption and public spending. The figure does not point to a boom, but it does confirm resilience.

The labor market provided another supportive element: according to ADP, the U.S. private sector created 109,000 jobs in April, the largest increase in 15 months and above consensus expectations. This strengthens the narrative of an economy capable of withstanding still relatively high interest rates.

Inflation remains the problem. U.S. CPI in March rose 3.3% year on year, up from 2.4% in February; core CPI stood at 2.6%, while energy rose 12.5% year on year. The PCE price index, a measure closely watched by the Fed, rose 3.5% year on year in March.

Indeed, the Federal Reserve kept the Fed Funds target range at 3.50%-3.75% at its April 29 meeting, reiterating its focus on incoming data, the evolution of the outlook and the balance of risks. The message for the Nasdaq is clear: earnings are winning over rate fears, but the sustainability of the rally will depend on inflation’s ability not to reaccelerate.

Technical view: strong momentum, but selectivity is needed

From a technical perspective, the Nasdaq 100 has recovered and surpassed its highs, with a short-term structure driven by breakouts, rotation into semiconductors and compressed volatility. The move from 27,651.82 points on May 4 to 28,599.17 on May 6 highlights a vertical acceleration in just two sessions.

In this type of environment, the risk is not necessarily an immediate reversal, but excessive euphoria. When the market rises on strong earnings and improving geopolitics, pullbacks can be rapid but technically interesting. Conversely, a renewed spike in oil, yields or inflation could turn the highs into profit-taking areas.

Trading focus: Nasdaq, technology and algorithmic models

The two trades shown in the NAS100 charts on the MT4 platform, executed through 4FT Invest algorithms, offer a practical reading of two different approaches to the same market.

The first is a contrarian long on a pullback: the price retreats after a phase of strength, tests a technical equilibrium area and generates a potential reabsorption opportunity. In this logic, the objective is not to anticipate the market discretionarily, but to identify conditions in which extension, correction and price reaction improve the risk/reward ratio.

The second is a trend-following long: the system does not look for the pullback low, but seeks to accompany an already directional structure, entering on the continuation of the move when the context remains consistent with the main trend.

The central point is technological: coded trading models, entry rules, position management and risk control. Technology does not eliminate market uncertainty, but it can help reduce improvisation, emotion and non-measurable discretion.

To learn more about the algorithmic approach and evaluate access to the platform: 4ftinvest.com

This content is provided for informational and educational purposes only. It does not constitute investment solicitation, personalized recommendation or financial advice. 4FT Invest is a technology service supporting market operations.