Dow claims record closing high, S&P 500 advances; chip selloff weighs on Nasdaq

NEW YORK - Wall Street advanced on Thursday as progress toward ending the Iran war buoyed investor sentiment, while disappointing results from Broadcom led a chip selloff that pulled the Nasdaq lower.

The blue-chip Dow surged, hitting a record closing high with a boost from healthcare and financial stocks.

The S&P 500 posted more muted gains, while the Nasdaq ended nominally lower on the day.

Chipmaker Broadcom missed revenue expectations, sending its shares tumbling 12.6% and casting a pall over the AI frenzy, which has sent chip stocks up over 92% so far this year.

"About the only blemish on the market at this point is Broadcom, and I think investors are buying the dip," said Paul Nolte, senior wealth adviser and market strategist at Murphy & Sylvest in Elmhurst, Illinois. "I don't think investors have given up on chips yet, but what they've yet to come to grips with, 'Is this real? Are these valuations legitimate?' I'm not sure yet that investors have really questioned that."

The U.S. House of Representatives passed a measure on Wednesday that would block President Donald Trump from continuing the war on Iran.

Additionally, a U.S.-mediated ceasefire agreement between Israel and Lebanon, an essential condition of an Iranian agreement to a peace deal, bolstered optimism of a near-term resolution to the war. But the truce was rejected by the pro-Iran Hezbollah, which said it would not withdraw troops from Lebanon.

A drop in front-month crude futures reflected hopes that tanker traffic through the crucial Strait of Hormuz could shortly resume.

"How many deals have we had? It's always right around the corner, a corner we've yet to reach," Nolte added. "Things are moving, but are they moving at a pace that's going to allow the world to get back to what passes for normal in a few weeks, a few months, or maybe sometime next year?"

On the economic front, initial jobless claims unexpectedly rose 6.1%, and first-quarter labor costs and productivity were revised sharply lower. A report from Challenger, Gray and Christmas showed layoffs announced by U.S. corporations jumped 11% in May to 97,006. Nearly 40% of those layoffs were attributed to AI.

The Dow Jones Industrial Average rose 874.86 points, or 1.73%, to 51,561.93, the S&P 500 gained 30.63 points, or 0.41%, to 7,584.31 and the Nasdaq Composite lost 23.02 points, or 0.09%, to 26,830.96.

Among the 11 major sectors of the S&P 500, healthcare and financial stocks boasted the biggest percentage gains, while technology shares were the biggest laggards.

Chipmaker Marvell Technology gained 4.9%, while Advanced Micro Devices, Micron Technology and Qualcomm fell between 2.6% and 7.7%.

The healthcare sector got a boost from UnitedHealth, which jumped 5.2% after Bank of America raised its rating on the healthcare conglomerate's shares to "buy."

The financial index's rebound followed a sharp selloff in the previous session due to revived concerns over private credit.

Blackstone became the latest asset manager to cap withdrawals from its flagship private credit fund following a rise in redemption requests. Its shares rose 7.5%.

Cybersecurity firm CrowdStrike slumped 3.8% after reporting an increase in quarterly operating expenses.

An investor roadshow for Elon Musk-led SpaceX began on Thursday ahead of its market debut on June 12. It aims to raise $75 billion in a record IPO that would value it at $1.75 trillion.

Advancing issues outnumbered decliners by a 2.19-to-1 ratio on the New York Stock Exchange. There were 308 new highs and 145 new lows on the NYSE.

On the Nasdaq, 3,082 stocks rose and 1,681 fell as advancing issues outnumbered decliners by a 1.83-to-1 ratio.

The S&P 500 posted 24 new 52-week highs and 11 new lows, while the Nasdaq Composite recorded 100 new highs and 92 new lows.

Volume on U.S. exchanges was 18.77 billion shares, compared with the 20.11 billion average for the full session over the last 20 trading days.

(Reporting by Stephen Culp in New York; Additional Reporting by Medha Singh and Twesha Dikshit in Bengaluru; Editing by Matthew Lewis)

Copyright Reuters or USA Today Network via Reuters Connect.

This story was originally published June 4, 2026 at 1:27 PM.