Wall Street started June on a positive note despite rising geopolitical tensions after Iranian media reported that the “Axis of Resistance” could activate “all fronts,” eToro analyst for Romania, Bogdan Maioreanu.
President Donald Trump downplayed concerns over Iran negotiations, stating he was not worried if talks collapsed and noting that Iranian officials had not indicated any withdrawal from discussions. Oil prices surged to session highs, with Brent rising above $97 a barrel, after the report that talks between Iran and US were halting. Prices eventually pared some gains after Trump’s comments. Brent crude ended the session up about 4%, near $95 a barrel.
The market response highlighted a growing contrast between asset classes: while commodities continue to react sharply to geopolitical developments, equities remain largely focused on growth opportunities, particularly those linked to artificial intelligence.
Commodities Paint a Mixed Picture
Reacting to geopolitical tensions, there was high volatility in the commodities world in May. On one hand, natural gas went up 18.94% for the month. On the other hand, oil went in the opposite direction: WTI down 16.22%, Brent down 16.85%. U.S. gas is rising because Europe continues to build up stocks ahead of winter, with the crisis in the eastern Mediterranean keeping LNG demand high, with the reopening of the distribution channel still only partial. Oil is falling because countries are emptying their strategic reserves, increasing supply, while Chinese demand has not yet shown the structural recovery the market was expecting. All of this is accompanied by a reduction in the geopolitical premiums factored into prices.
Tech Equities Extend Their Momentum Despite Geopolitical Tensions
Despite geopolitical volatility affecting commodity markets, the stock market is selectively focused on AI. Overall sector performance was mixed, with only two of the 11 S&P 500 sectors ending in positive territory, led by information technology and consumer discretionary, while utilities lagged the most. Technology was again the main engine, but it was a selective growth: hardware above software, and storage above enterprise.
Dell Technologies leads the monthly rankings with a price appreciation of over 101.4%, followed by Micron Technology +87.8% and Datadog at +87.1%. The common thread linking the top names is clear: storage, memory semiconductors, AI infrastructure. The market rewarded everything that physically touches data — stocks like Western Digital, HPE, NetApp and SMCI—the hardware on which artificial intelligence runs.
The next catalyst: tech giant IPOs
Nvidia was up 5.8% in May, despite record earnings, but this gain at that market cap is no small feat. Google closed slightly down. Amazon rose 2%. Stocks with market caps over $3 trillion all clustered within a range that, by comparison with their previous evolution, appears narrow – between -5% and +15%. True performance was generated in the tech stocks within the $50 billion to $500 billion range in market capitalization. Mega-caps acted as a floor, not a ceiling.
The market continues to look at AI but is also waiting for potential IPOs. On Monday, Anthropic has confidentially submitted its draft initial public offering prospectus to the U.S. Securities and Exchange Commission. Anthropic has not set a price or finalized the number of shares that will be available if they go public, but this move signifies that the wait for one of the AI giants to go public maybe almost over. OpenAI was said to be preparing its own confidential filing for an initial public offering in the coming weeks.
Resilience Tested by Competing Forces
Markets are entering the final stretch of the second quarter balancing two powerful forces: structural enthusiasm around AI and rising geopolitical uncertainty. While equities continue to be supported by strong momentum in semiconductors and AI infrastructure plays, the divergence within sectors and market caps suggests a more selective environment rather than a broad-based rally. At the same time, oil’s volatility and shifting expectations around interest rates – now tilting away from cuts and toward potential hikes in 2027 – add a layer of macroeconomic risk that investors cannot ignore. With major catalysts ahead, including potential landmark AI IPOs and ongoing developments in the Middle East, markets remain resilient for now, but increasingly sensitive to any trigger that could disrupt the current equilibrium.
