US stocks traded higher on Thursday as investors returned to semiconductor stocks after several days of heavy selling pressure. The S&P 500 gained 0.4%, while the Nasdaq Composite added 0
US stocks traded higher on Thursday as investors returned to semiconductor stocks after several days of heavy selling pressure.
The S&P 500 gained 0.4%, while the Nasdaq Composite added 0.5%. The Dow Jones Industrial Average advanced roughly 250 points, or 0.5%.
The gains followed a difficult stretch for technology shares, particularly semiconductor companies, which had experienced significant profit-taking after leading the market's artificial intelligence-driven rally for much of the year.
Market sentiment improved as investors stepped back into some of the sector's biggest names, helping stabilize broader indexes.
The rebound was led by chipmakers that had come under intense pressure during recent sessions.
Micron Technology, Advanced Micro Devices, and Intel all moved higher, while the iShares Semiconductor ETF gained around 3%.
Intel stood out among the group after receiving an upgrade from Bank of America, which lifted the stock by approximately 5%.
The recovery comes after semiconductor shares suffered a sharp correction, including a 10% decline in the chip ETF last Friday that sparked concerns the AI-driven rally may have become overextended.
Despite the recent volatility, many investors continue to view artificial intelligence infrastructure spending as a powerful long-term growth driver.
Market participants are also preparing for the highly anticipated debut of SpaceX on Friday. The offering is expected to become the largest IPO in market history, with a valuation approaching $1.8 trillion.
The SpaceX IPO has now drawn more than $70 billion worth of retail orders alone. Some traders believe recent weakness in semiconductor stocks may partly reflect portfolio repositioning ahead of the offering, as investors raise cash to participate in the debut.
The IPO is widely viewed as another major test of investor enthusiasm for AI-related growth themes and technology valuations.
However, not all AI-related companies participated in Thursday's rebound.
Shares of Oracle Corporation fell sharply after the company announced plans to raise an additional $20 billion through debt and equity offerings to fund its expanding artificial intelligence infrastructure investments.
While technology stocks provided support, geopolitical developments prevented a stronger market rally.
President Donald Trump warned that the United States would strike Iran ”very hard” and threatened to take control of key Iranian energy infrastructure, including Kharg Island, which handles the majority of the country's crude exports.
The comments followed another round of military exchanges between the United States and Iran.
Iran's Revolutionary Guard said it targeted US bases in the region overnight, while US forces carried out additional strikes against Iranian positions.
Meanwhile, diplomatic efforts appear increasingly strained after Qatari-mediated talks between Iranian and US representatives failed to produce a breakthrough.
Energy markets remained cautious as geopolitical risks persisted. WTI crude oil traded near $89 per barrel as investors monitored the situation surrounding the Strait of Hormuz.
Iran claimed the waterway had been closed, though US officials disputed the assertion.
The continued uncertainty surrounding one of the world's most important oil shipping routes has helped keep crude prices elevated despite concerns about global economic growth.
Beyond technology, investors continued rotating into sectors viewed as more defensive or undervalued.
According to market strategists, healthcare, biotechnology, financials, and energy have attracted increased interest as traders look for alternatives to the crowded AI trade.
Producer price data released Thursday showed inflation pressures remain mixed. Headline producer inflation rose more than expected, while core inflation came in below forecasts.
