The S&P 500 index closed at a record high on May 31, 2026, with only a small number of stocks, primarily in the artificial intelligence sector, reaching their own all-time highs. On that day, only 20 members of the index achieved record highs, with just seven not directly related to AI. Michael Hartnett, a strategist at Bank of America, noted similarities to the dot-com bubble of March 2000, where a limited number of stocks also reached new highs. Hartnett suggested that the current speculative price action may not be over, but indicated that central banks and rising interest rates could signal an end to this trend, providing a 'post-bubble' roadmap for investors.
The recent stock market surge has been largely driven by semiconductor companies, particularly memory chip manufacturers such as Micron Technology, Advanced Micro Devices, SK Hynix, and Samsung. AMD's stock rose by 45.6% in May, while Micron increased by 87.8%, Samsung by 43%, and SK Hynix by 81%. The Nasdaq Composite index also experienced significant gains, rising 25% in April and May, marking its best two-month performance in over 20 years.
However, some analysts express concern that the current bull market may be unsustainable if it does not broaden beyond a few leading stocks. Advance-decline lines, which measure the number of stocks advancing versus those declining, showed a similar pattern, rising sharply at the end of March but declining since mid-April. As of May 20, only about 55% of S&P 500 constituents were trading above their 200-day moving average, indicating potential market vulnerability, according to BCA Research. Hartnett advised clients to consider a defensive investment strategy, referencing historical trends following market bubbles.
