Traders work on the floor of the New York Stock Exchange (NYSE) on May 6, 2026 in New York City.

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U.S. equities rose on Friday following a better-than-expected April’s jobs report and as traders eyed developments between the U.S. and Iran.

The S&P 500 was up 0.8%, while the Nasdaq Composite climbed 1.4%. Both indexes hit new all-time intraday highs in the session. The Dow Jones Industrial Average hovered around the flatline.

All three major averages are on track to finish the week higher as earnings continue to come in strong. Upbeat tech earnings have put the Nasdaq on pace to climb 4% on the week. The S&P 500 is on track for a rise of about 2%, heading for its sixth consecutive winning week, while the Dow Jones has lagged with a week-to-date gain of 0.2%.

Sentiment was also bolstered by the Bureau of Labor Statistics reporting that nonfarm payrolls rose by 115,000 last month, more than the 55,000 that economists polled by Dow Jones were expecting. The U.S. jobless rate also held steady at 4.3%, in line with expectations.

However, oil prices were marginally higher, with West Texas Intermediate crude futures rising 1% to around $95 per barrel, after the U.S. and Iran exchanged fire in the Strait of Hormuz. Each side claimed the other struck first. U.S. Central Command said that military forces “intercepted unprovoked Iranian attacks and responded with self-defense strikes” as a trio of U.S. Navy destroyers transited the waterway.

In a Truth Social post Thursday night, President Donald Trump said there was “no damage done to the three Destroyers, but great damage done to the Iranian attackers.” He also reportedly said that the ceasefire is still in effect, saying the strikes against Iranian targets were “just a love tap.”

Investors have been awaiting a response from Iran on the proposal to end the conflict in the Middle East after Iranian state media reported Thursday that Iran was reviewing messages from the U.S. that were received through Pakistani mediators but had not yet reached a conclusion. Secretary of State Marco Rubio told reporters Friday that the U.S. “should know something today.”

The S&P 500 and Nasdaq Composite had hit fresh record highs in the previous session before retreating after a senior Iranian official said that the country would not allow the U.S. to reopen the Strait of Hormuz passageway with an “unrealistic plan,” Iran’s state-owned Press TV reported. The official added that Iran would not let the U.S. leave the conflict without paying reparations for the damage it has inflicted.

But Keith Buchanan, senior portfolio manager at Globalt Investments, is skeptical that the market’s recent run can continue, especially given how much of it is being propped up by optimism surrounding artificial intelligence capital expenditures. That has spurred a rally in memory stocks, with Micron Technology and Sandisk, for example, soaring around 12% each Friday and 35% and 28% this week, respectively.

“The market is trading valuations that don’t indicate the risk that we see that out there,” Buchanan said, citing the potential for the Middle East conflict to continue longer than expected and the increasingly adverse impacts of that on the consumer.

“It’s a tale of the AI spend and the ripple effects – and earnings as well – that’s absolutely powering an economy that is, without that spending and optimism, probably pretty lackluster,” he continued.

— CNBC’s Kevin Breuninger and Elsa Ohlen contributed reporting.