Reuters reported that the S&P 500 closed Wednesday at 7,137.90 and the Nasdaq at 24,657.57, both records, as technology led the market higher and first-quarter earnings growth tracked at roughly 14%.
US stocks and the AI earnings engine
The clearest proof that the AI trade still has fundamental backing came from TSMC’s latest forecast. The chipmaker, a key supplier to Nvidia, said first-quarter profit jumped 58% to a record, lifted its full-year revenue outlook and described AI-related demand as “extremely robust.”
The optimism is spreading beyond one company. Reuters noted that stronger guidance from ASML and TSMC suggests the AI spending boom remains intact, with major cloud companies expected to spend more than $600 billion this year on data centers. That matters because it widens the story from a few chip designers to the broader ecosystem building, equipping and powering AI capacity.
One example is Nokia’s fresh earnings beat, which showed sales to AI and cloud customers rising 49% as it booked 1 billion euros in new orders. That kind of read-through helps explain why investors are increasingly willing to bid up not just semiconductors, but also networking, optics and data-center infrastructure names.
Why US stocks are attracting bullish FOMO again
There is a psychological shift underneath the numbers. In a new Reuters analysis, money managers described investors returning to equities as improving earnings estimates and AI spending trends reignited fear of missing out. Expectations for 2026 earnings growth have climbed from 16% in early January to nearly 20%, with technology doing much of the work.
That helps explain why every solid AI-linked quarter is carrying extra weight. After a fast rebound from spring lows, investors no longer want to be underexposed if the next leg of the rally belongs to semiconductors, data centers and the companies selling the picks and shovels behind them.
US stocks have been building toward this moment for two years
This did not start overnight. A Reuters report from July 2024 showed how record highs were already leaning heavily on megacap technology and semiconductor strength, even as the broader market lagged behind.
By August 2025, Reuters was already asking whether the AI trade had become too concentrated around Nvidia and a handful of giant winners. The difference in 2026 is that the bullish case is broadening: the market is now rewarding the manufacturers, networking vendors, optical suppliers and power-related businesses supporting AI build-outs, not just the headline chip names.
What could stop US stocks now
The rally is not risk-free. Oil remains elevated, geopolitical tensions have not fully disappeared and valuations will look vulnerable if companies fail to match rising expectations. The higher stocks climb, the less room Wall Street has for even small disappointments in guidance.
Still, the current setup is easy to understand. As long as earnings keep beating, AI capital spending keeps compounding and investors keep seeing hard numbers behind the story, US stocks can continue to trade like momentum has room left. The catch is that a market driven by bullish FOMO usually becomes less forgiving just when confidence looks strongest.
