U.S. equities ended Thursday in positive territory, with the Dow Jones Industrial Average climbing 139 points as a surge in semiconductor stocks outweighed investor concerns over escalating military actions between the United States and Iran. A pullback in crude oil prices also helped steady broader market sentiment.
The Dow rose 0.27% to close at 52,487.41. The Nasdaq Composite advanced 1.30% to 26,206.89, while the S&P 500 gained 0.81% to finish at 7,543.65.
Chip Stocks Lead the Charge
Semiconductor shares powered the market higher, with the VanEck Semiconductor ETF jumping 2.5%. Micron Technology surged 4.5% after announcing plans to invest more than $250 billion in U.S. operations through 2035 to expand memory chip production, driven by artificial intelligence demand. Applied Materials and SanDisk also posted strong gains, with SanDisk rising 7.6%.
Meta Platforms added to the positive tone after Reuters reported the company intends to begin manufacturing its in-house AI chip in September. The Philadelphia Semiconductor Index extended its recent advance as investors continued to favor AI-linked names despite recent sector volatility.
With second-quarter earnings season approaching, analysts polled by LSEG I/B/E/S expect S&P 500 companies to report average year-over-year earnings growth of 24%, with technology firms contributing a significant portion. The S&P 500 currently trades at about 20 times forward earnings, down from roughly 21 times a month ago.
Geopolitical Tensions and Oil Markets
Investor caution persisted after the U.S. launched a second consecutive day of strikes on Iran, according to U.S. Central Command. The attacks followed Tehran's strikes on commercial shipping near the Strait of Hormuz, a critical energy chokepoint. However, crude oil prices declined after President Donald Trump said Iran had called to negotiate. Reports also indicated Qatar and Pakistan were attempting to facilitate renewed talks.
The latest comments contrasted with Trump's remarks a day earlier, when he declared the ceasefire with Iran was "over" and suggested he was no longer interested in pursuing negotiations. For more on the evolving situation, see our Evening Digest: US-Iran Strikes Escalate, SK Hynix Nears Record $26.5B US IPO.
European markets recovered, with the pan-European Stoxx 600 rising 0.8%. In Asia, Japan's Nikkei 225 gained 1.4%, South Korea's Kospi added 0.62%, Hong Kong's Hang Seng fell 0.5%, and China's CSI 300 climbed 2.5%.
Fed Policy and Economic Data
Investors also weighed the outlook for inflation and monetary policy. Weekly U.S. jobless claims declined, suggesting the labor market remains stable despite slower job growth in June. Minutes from the Federal Reserve's June meeting showed that while policymakers kept interest rates unchanged, some officials saw a case for raising borrowing costs before agreeing to hold steady. Traders currently price in a likely 25-basis-point rate hike by the Fed's December meeting.
For a broader perspective on market dynamics, see our analysis of 5 Under-the-Radar Stocks Analysts Favor for Summer 2026 as Market Broadens.
This article is for informational purposes only and does not constitute financial advice.
