Wall Street opened higher on Monday as the S&P 500 gained 0.7% and the Nasdaq Composite surged 1.1% or over 300 points, according to CNBC TV18. The Dow Jones Industrial Average recovered over 400 points from the day's lows to close above the 53,000 mark for the first time, gaining 150 points. Chipmakers and AI-linked companies led the gains, with Broadcom climbing 3.5% after extending its partnership with Apple till 2031. Nvidia recovered to end above the flat line after stating that its roadmap remains intact, while AMD shares surged 6.5% on a positive brokerage note. The rebound comes after US stock futures surged on Monday as Nasdaq-100 futures jumped 1.2%, signaling a stronger open for Wall Street. Accenture climbed 7%, Cognizant advanced 7.14%, IBM rose 3%, while Salesforce and ServiceNow gained nearly 5% each following Guggenheim's bullish call on the sector.
Semiconductor companies have bounced back strongly from their previous session's rout, with Micron rising as high as 4% to $1,019 and Intel climbing 5% to $127.30, according to latest market data. Advanced Micro Devices Inc. soared as high as 10% to $572.50 after receiving a sharp target price hike from Goldman Sachs analyst James Schneider, who boosted his 12-month outlook from $450 to a whopping $640, retaining its 'Buy' rating. As of 12:32 p.m., AMD shares traded 8.6% higher at $561.49. Other storage and memory manufacturers like Sandisk Corp. and Qualcomm Inc. also surged 3% and 6.4% to $1,837.77 and $188.67. Broadcom Inc.'s stock surged 3.5% to a high of $383.16 after extending a long-running supply agreement covering custom semiconductor development and production with Apple Inc., which will continue developing custom application-specific integrated circuit chips for Apple across multiple generations of products.
SK Hynix kickstarted the process for its mega IPO on Wall Street on Monday, according to CNBC TV18. As per its filing with the US Securities and Exchange Commission (SEC), the company plans on issuing up to 17.7 million American Depository Receipts (ADRs), with each ADR being a tenth of the common share listed in South Korea. Based on the current exchange rate, the IPO is valued at around $28 billion, marginally lower than Saudi Aramco's $29 billion, but still the biggest by any foreign company on Wall Street. According to a Bloomberg report, the IPO demand has already exceeded the total number of ADRs on offer, with multiple large funds committing large sums for purchasing them. SK Hynix could begin trading on Friday, July 10. This planned mega share sale by the South Korean chipmaker adds another layer of scrutiny to the AI infrastructure investment thesis, as investors will be closely watching whether massive capital requirements can translate into sustainable returns.
AI-related stocks have witnessed sharp swings in recent weeks as investors reassess whether massive spending on AI chips, infrastructure and data centres will generate returns sufficient to justify soaring valuations. As per Bloomberg, Guggenheim analyst John DiFucci argued that "valuations imply many software companies will decline into perpetuity because of AI," but emphasized "we don't believe that to be true." However, market analysts note that the AI rebound looks more like a positioning reset than a clean all-clear, with the next verdict coming from earnings, cash flow and capex guidance. The central question remains: can the extraordinary AI infrastructure spend translate into a durable profit pool rather than simply a larger capex bill?
US stock futures traded with healthy gains in Monday's session, with Nasdaq 100 futures climbing 1.2% after the US holiday break, while futures tied to the Dow Jones Industrial Average were little changed, and S&P 500 futures gained 0.4%. All three benchmark indices ended last week in the green, with the Dow Jones climbing nearly 2%, bringing it within striking distance of the 53,000 mark, a level it has never reached. The S&P 500 and Nasdaq Composite also posted solid weekly gains of 1.8% and 2.1%, respectively. However, chip stocks—which had driven Wall Street's sharp rally this year—have recently lost momentum as investors grew concerned that the AI-driven rally had gone too far, too fast, prompting profit booking. Weak cues from some Asian markets also kept sentiment toward semiconductor stocks subdued. Technology stocks led the advance, signalling renewed investor confidence in the artificial intelligence (AI) trade after a late-June pullback in semiconductor shares. The current recovery suggests that market participants are viewing the recent sell-off as an overreaction rather than a fundamental shift in the AI infrastructure investment thesis.
