Options Brief – Snowflake and AI lift records – 29 May 2026

The S&P 500 reached a new all-time high despite April PCE at a three-year high, as AI earnings momentum continues to outweigh macro concerns.

Headline driver

The S&P 500 and Nasdaq 100 closed at fresh all-time highs on Thursday, led by an AI software breakout after Snowflake surged 36% on a $6 billion Amazon Web Services partnership and a strong earnings beat, with Microsoft, Oracle, and Palantir adding 3–4% in sympathy. Markets absorbed April PCE data showing headline inflation at 3.8% year-on-year, the highest reading since May 2023, and kept climbing, confirming that the current rally is driven by earnings and AI spending momentum rather than macro sensitivity.

Market snapshot

The S&P 500 closed at 7,563.63, up 0.58%, marking a new all-time high. The Nasdaq 100 gained 0.84% to 30,223.89. The Russell 2000 added 0.57% to 2,936.57, while the Dow Jones edged 0.05% higher to 50,674.06. Gold futures settled near $4,541 per ounce. The 10-year Treasury yield held at 4.459%, essentially unmoved by the PCE print.

Market regime: Low vol bull – VIX 15.80, 20-day realised vol 10.2% (stable), S&P 500 +7.45% above its 50-day moving average.

Options flow sentiment

Based on end-of-day 28 May 2026 – yesterday’s positioning, not today’s price action.

Single-name flow leaned bullish, with the call side dominant in large-cap technology names and the resulting market-maker hedging profile tilted to add incremental buying pressure on any intraday move higher.

In the index and ETF book, put-side activity outweighed calls, consistent with a broad portfolio protection posture rather than fresh downside conviction; institutions appear to be hedging a long book, not exiting it.

Options angle

VIX closed at 15.80 on Thursday, essentially flat on the session, with the low vol bull regime intact heading into Friday. With 20-day realised vol at 10.2%, implied vol is running at roughly 1.5x what the market has actually delivered over the past month. That gap has been the dominant feature of this regime: options are consistently priced for more movement than arrives.

Strategy insight – Iron condor in a slow-grinding, low-realised-vol environment. When implied vol runs persistently above realised vol and the index is trending higher with shallow pullbacks, an iron condor collects premium on both sides within a defined-risk structure: short an out-of-the-money call spread and short an out-of-the-money put spread simultaneously, keeping the net credit if the underlying stays between the two short strikes at expiry. The appeal here is that the underlying would need to move significantly more than it has been realising just to reach the short strikes, providing a meaningful buffer without requiring a precise pin. The maximum loss is the difference between the spread widths minus the credit received, and is capped on both sides.

Important note: The strategies and examples provided in this article are purely for educational purposes. They are intended to assist in shaping your thought process and should not be replicated or implemented without careful consideration. Every investor or trader must conduct their own due diligence and take into account their unique financial situation, risk tolerance, and investment objectives before making any decisions. Remember, investing in the stock market carries risk, and it’s crucial to make informed decisions.

Strategy insight – Covered call overlay after a sharp earnings-driven move. When a stock surges on strong earnings and forward guidance, near-term implied vol in that name often stays elevated for several sessions as the market digests the move. An investor already holding the position can sell an out-of-the-money call against it to collect that elevated premium as income while the stock consolidates. If the stock stays below the strike, the call expires worthless and the premium is kept in full. If it continues higher and is called away, the investor exits at a price above where the call was sold. The risk is that a continued sharp rally above the strike caps the upside, and the premium collected may not compensate fully for the forgone gain.

Conclusion

Thursday confirmed the market’s current disposition: resilient enough to shrug off the hottest PCE print in three years and rally into new territory on AI earnings momentum. Heading into Friday, the low vol bull regime holds, realised vol is running well below implied, and the setup remains structurally favourable for premium sellers. One flag worth keeping in mind: the institutional put demand in yesterday’s index book was not panic flow, but it was broad and persistent, a reminder that the people managing the largest books are not abandoning downside coverage at all-time highs.