Stock Market Today, May 26: Micron Surges After UBS Lifts Price Target on AI Optimism
In midday trading, the S&P 500 (SNPINDEX:^GSPC) rose 0.57% to 7,516.11, the Nasdaq Composite (NASDAQINDEX:^IXIC) climbed 1.00% to 26,606.90 on AI strength, while the Dow Jones Industrial Average (DJINDICES:^DJI) slipped 0.23% to 50,463.03 as non-tech blue chips lagged.
Market movers
Micron Technology (NASDAQ:MU) jumped roughly 18% toward a $1 trillion valuation after UBS (NYSE:UBS) tripled its price target, powering semiconductor and AI gains, while travel names including United Airlines (NASDAQ:UAL) and Carnival (NYSE:CCL) rallied on easing oil and optimism over Iran peace talks.
What this means for investors
Concerns about a bubble forming in AI-related names aren’t slowing the rally in many of those stocks. Micron Technology stock is leading the way today. Shares of the semiconductor maker have more than tripled just this year, and today’s 18% rally led its market cap to cross the $1 trillion mark.
The stock jumped after President Trump praised the company at a rally on Friday for its “hundreds of billions” of investment in the U.S. economy. Shares are also gaining after UBS analyst Timothy Arcuri more than tripled his firm’s price target on Micron from $535 to $1625 per share.
Other factors driving the market today are renewed optimism on a peace deal with Iran, fresh U.S. military strikes labeled as defensive, and falling oil prices and Treasury yields. Lower oil prices and a pullback in the 10-year yield are helping to ease inflation worries.
There remains significant uncertainty in the market, and valuations are becoming stretched across many areas. Long-term investors shouldn’t worry about the volatility, but could consider taking some profits at this stage of the bull market.
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Howard Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Micron Technology and Taiwan Semiconductor Manufacturing. The Motley Fool recommends Carnival Corp. The Motley Fool has a disclosure policy.
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