Wall Street showed signs of stability as stocks in the artificial intelligence sector rebounded following positive news from a major Taiwanese chip manufacturer. The S&P 500 experienced a 0.4% uptick, aiming to end a two-day losing streak after reaching an all-time high. The Dow Jones Industrial Average surged by 331 points, or 0.7%, with less than an hour left in trading, while the Nasdaq composite rose 0.4%.
A driving force behind the market’s resurgence was Nvidia and other high-profile AI stocks, which gained momentum after Taiwan Semiconductor Manufacturing Co. (TSMC) posted better-than-expected quarterly profits. TSMC also announced plans to potentially increase its equipment investments to $56 billion this year to capitalize on the AI boom. This news provided a much-needed boost for Nvidia, which had struggled recently, falling 1.4% the day prior. The company’s shares jumped 3% after TSMC’s Chief Financial Officer, Wendell Huang, indicated ongoing strong demand in the AI sector.
TSMC’s significance as a key supplier for Nvidia and other tech giants, as well as its role as a major customer for equipment manufacturers like ASML, underlines the interconnectedness of the tech industry. TSMC’s U.S.-listed shares rose by 5.1%, and ASML’s stocks increased by 6.1%. Other chip-related firms, including KLA Corp. and Applied Materials, also experienced significant gains, rising 8.3% and 7.1%, respectively.
In addition to the boost from the tech sector, a sharp drop in oil prices contributed to market stabilization. U.S. benchmark crude prices plummeted 4.6% to $59.19 per barrel, while Brent crude decreased by 4.1% to settle at $63.76 per barrel. Analysts linked this decline to remarks from President Donald Trump, who suggested that plans for executions in Iran had been halted amid ongoing protests. The easing of geopolitical tensions was interpreted as a positive indicator for oil supply stability.
Gold prices also saw a slight dip of 0.3%, further signaling a calming effect across financial markets. As earnings season for major U.S. companies continued, several prominent financial firms reported robust results. BlackRock saw a 6.3% increase in its stock price after exceeding profit and revenue expectations. Morgan Stanley rose 6.2%, and Goldman Sachs climbed 4.5% despite falling short on revenue.
Amid corporate news, biotech firm Boston Scientific’s shares dropped 3.5% after announcing a $14.5 billion acquisition of Penumbra, a company specializing in clot-removal products, which saw its stock rise by 12.1%.
On the bond market front, Treasury yields increased following positive economic indicators. Reports showed a decrease in jobless claims, suggesting that layoffs might be slowing, alongside robust manufacturing activity in the mid-Atlantic region and New York state. As a result, the yield on the 10-year Treasury bond rose to 4.16%, up from 4.12%.
This strong economic data particularly favored stocks of smaller companies, which tend to be more closely linked to domestic economic conditions. The Russell 2000 index experienced a notable rise of 1.2%, outperforming the S&P 500.
Globally, stock markets displayed mixed results, with European and Asian indexes showing varied performance. South Korea’s Kospi index notably gained 1.6%, reflecting some of the stronger movements seen across the globe.
