US stocks, especially in the tech sector, experienced significant gains, with the S&P 500 Index climbing 0.7% and the Nasdaq 100 rising 0.5% by 11:17 a.m. in New York. This rebound followed a sharp global selloff yesterday. The rally was fueled by expectations that falling crude oil prices and weak housing market data would reduce the pressure on the Federal Reserve to increase interest rates. Consumer discretionary and industrial sectors led the S&P 500 higher. The blue-chip Dow Jones Industrial Average also saw a 0.9% increase.
Driving much of this optimism was the anticipation of Micron Technology Inc.'s earnings report, which was expected to provide a crucial update on the sustainability of the AI rally. Micron's shares had already soared approximately 260% this year due to high demand from data-center developers, making it a major contributor to the S&P 500's roughly 7% advance. Other memory and storage companies like Sandisk Corp., Western Digital Corp., and Seagate Technology Holdings Plc also featured prominently in the market's leadership. Despite a previous session where Micron plunged more than 13%, Nasdaq 100 futures gained, supported by rebounds in chip and AI infrastructure stocks, with Arm Holdings advancing over 4%, Micron more than 3%, and Intel over 2%.
The decline in oil prices further bolstered market sentiment. WTI crude fell over 1% on Wednesday, extending recent drops as more tankers traversed the Strait of Hormuz with satellite signals active, indicating increased confidence among shipowners. The easing inflation concerns were also reflected in the 10-year T-note yield, which slipped two basis points to 4.49%. This confluence of factors led to a more positive outlook for the market, with analysts like Marija Veitmane at State Street Global Markets emphasizing that strong earnings and guidance from Micron would be key to sustaining the tech rally.
