US stock markets closed higher on Tuesday, recovering from three consecutive sessions of losses, as chipmakers and other major US companies posted stronger-than-expected profit reports. The Nasdaq Composite led the gains, rising 1.3%, while the S&P 500 climbed 0.9% and the Dow Jones Industrial Average added 0.7%, or 385 points. This rally was largely attributed to a rebound in semiconductor stocks, with the iShares Semiconductor ETF (SOXX) adding 5.5% and the Roundhill Memory ETF (DRAM) climbing 11%. Chipmakers like Micron, SK Hynix, Sandisk, Western Digital, and Seagate Technology jumped between 11% and 14%, while Advanced Micro Devices, Intel, and Marvell Technology advanced 6% to 9%. Intel also benefited from news that it would manufacture Fortinet’s next generation of cybersecurity chips.
Despite the stock market's upward trend, rising oil prices and Treasury yields posed potential headwinds. Brent crude oil briefly approached $92 per barrel, settling at $91.01, up significantly from less than $72 earlier in the month, due to ongoing attacks between the United States and Iran. West Texas Intermediate futures also rose 2.1% to $85 a barrel, their highest in over five weeks. This increase in oil prices threatens to reaccelerate inflation, potentially prompting the Federal Reserve and other central banks to raise interest rates, which could slow economic growth and negatively impact stock prices. The yield on the 10-year Treasury note also rose to 4.63% from 4.60% on Monday, up from 3.97% before the conflict with Iran began.
Several companies reported strong earnings, contributing to the market's positive performance. 3M climbed 7.3% after exceeding analysts’ expectations for both profit and revenue and raising its full-year 2026 profit forecast. Hasbro rallied 8.8% after its Magic: The Gathering game surpassed $500 million in revenue for a quarter for the first time, and the toy maker also raised its revenue forecast for the year. General Motors cruised 4.9% higher following strong profit and revenue reports. In contrast, Danaher led S&P 500 decliners with an 11% drop, while defense contractor Northrop Grumman and Halliburton fell 2.5% and 5.5%, respectively.
