Oil prices went down and somewhat discounted stocks suddenly weren’t that discounted.
🚀 Tech Reclaims the Wheel
- The Nasdaq Composite jumped 1.3% Thursday, leading Wall Street higher as the S&P 500 gained 0.8% and the Dow Jones added 139 points, or 0.3%. Tech was back in charge, but this time, it wasn't driving alone.
- Roughly two-thirds of S&P 500 stocks traded higher by the closing bell, a sign that the rally broadened beyond the usual AI mainstays.
- For a market that recently couldn't stop talking about concentration risk, seeing more stocks join the party was a welcome change.
🛢️ Oil Cools, Risk Heats Up
- Investors breathed easier as fears of a wider US-Iran conflict eased, sending US crude oil down 2% to about $72.10 a barrel after flirting with $76 during the previous session.
- Lower oil prices help calm inflation fears because cheaper energy eases pressure on businesses and consumers.
- That, in turn, reduces concerns that the Federal Reserve may need to keep interest rates higher for longer.
- A softer US dollar also boosted safe havens, with gold futures climbing 1.5% to around $4,130 an ounce for their biggest daily gain in weeks.
💻 Chip Bulls Reload
- Semiconductor stocks bounced back as investors returned to AI trades. Broadcom extended gains, while optimism around chip demand replaced fears that the sector's rally had run out of steam.
- Confidence also got a boost from SK Hynix's US listing, with demand for its shares reportedly seven times oversubscribed — a strong sign investors are still eager to buy into the AI infrastructure story.
- Looking ahead, US futures edged slightly lower early Friday after Thursday's rally, while Asian tech stocks picked up the baton. South Korea's Kospi surged 4.6%, the Kosdaq climbed 5.9%, and Japan's Nikkei 225 gained 1.5%, suggesting the AI trade still has a crowd.