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 percent and casting a pall over the AI frenzy, which has sent chip stocks up over 92 percent 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 US House of Representatives passed a measure on Wednesday that would block US President Donald Trump from continuing the war on Iran.
Additionally, a US-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 US jobless claims unexpectedly rose 6.1 percent, and first-quarter labour costs and productivity were revised sharply lower.
A report from Challenger, Gray and Christmas showed lay-offs announced by US corporations jumped 11 percent in May to 97,006. Nearly 40 percent of those lay-offs were attributed to AI.
The Dow rose 1.7 percent, to 51,561, the S&P 500 rose 0.4 percent, to 7,584, while the Nasdaq fell 0.1 percent, to 26,830. (Reuters)
