The volatile AI trade marched higher, but oil kept Wall Street on edge last week

Here is a story making headlines in the economy: Wall Street's record-setting start to the week ran into two familiar sources of volatility: the artificial intelligence trade and oil. The Dow Jones Industrial Average on Monday closed above 53,000 for the first time ever before renewed U. -Iran tensions erased those gains, leaving the blue-chip index down 0.

Chip stocks — once the hottest corner of the market — also swung sharply as investors continued to question whether the AI trade had become overextended. Even so, the tech-heavy Nasdaq gained 1. 74% for the week, while the S & P 500 rose 1.

Economic Details

Both indexes have finished higher in four of the past five weeks. Here's a closer look at what drove the market last week. Chip stocks take investors for a wild ride Semiconductor stocks remained at the center of the market action.

The group started the week strong, with the VanEck Semiconductor ETF rising about 2% on Monday as investors bought back into some of the biggest winners from the first half of the year. But the rally quickly faded Tuesday after Samsung's results failed to impress investors and reported that China's DeepSeek is developing its own AI chip. Micron , the Idaho-based rival to Samsung, fell 4.

7%, while the VanEck Semiconductor ETF dropped almost 4%. The semiconductor trade stabilized Wednesday, helped by Apple's announcement that it was expanding its longtime partnership with Broadcom in a multiyear deal expected to exceed $30 billion. Apple has historically tapped Broadcom for connectivity chips that help its devices connect to cellular, WiFi and Bluetooth networks.

Analyst Views

The new agreement calls for the production of more than 15 billion U. -made chips and includes a $1. 5 billion expansion of Broadcom's manufacturing facility in Fort Collins, Colorado.

Broadcom shares climbed nearly 5% on the news Wednesday. It was the second Apple-Broadcom headline of the week. On Monday, Broadcom said in a securities filing that it agreed to supply Apple with "a range of custom ASIC silicon products for use in multiple generations of Apple products.

" ASIC is short for application-specific integrated circuit — and that jibes with Bloomberg News has reported that Broadcom is working Apple on a specialized AI server chip for its data centers. That would be akin to Broadcom's co-design relationship with Google on its in-house tensor processing units (TPUs). Broadcom was our second-best performer last week, up 10%.

Economists are analysing what the news means for the markets.