Chipmakers Drive Market Surge as Investor Confidence Rises

The S&P 500 Index ($SPX) (SPY) gained +0.47%, the Dow Jones Industrial Average ($DOWI) (DIA) rose +0.14%, and the Nasdaq 100 Index ($IUXX) (QQQ) advanced +1.55% on the day. September E-mini S&P futures (ESU26) climbed +0.47%, while September E-mini Nasdaq futures (NQU26) increased +1.51%.

Equity markets rallied, propelled by robust performance in semiconductor stocks following strong investor demand for South Korea’s SK Hynix American depositary receipts (ADRs), which were oversubscribed by over seven times. The U.S. offering is projected to generate approximately $24.5 billion for SK Hynix, marking the second-largest foreign fundraising effort by a company, according to Bloomberg.

Despite escalating U.S.-Iran tensions, with retaliatory attacks in the Middle East entering a second day, the labor market’s resilience bolstered investor sentiment. Weekly initial unemployment claims unexpectedly declined by 2,000 to 215,000, a six-week low, exceeding forecasts of a 2,000 increase to 217,000, signaling a stronger-than-expected labor market.

Optimistic Q2 earnings projections further supported equities, with Bloomberg Intelligence data suggesting a potential 23% earnings growth, nearing Q1’s outperformance of 30%—double analysts’ prior expectations. AI-driven spending is anticipated to dominate earnings momentum, with AI infrastructure stocks expected to contribute nearly 60% of the S&P 500’s earnings-per-share expansion in Q2.

WTI crude oil (CLQ26) edged up +0.61%, though it remains below its two-week peak. The U.S. military conducted a second day of strikes against Iran, targeting roughly 90 sites, while Iran retaliated with drones and missiles aimed at U.S. installations in Bahrain, Kuwait, and Qatar. President Trump’s declaration that the ceasefire with Iran has ended has raised concerns over prolonged regional instability and potential energy supply disruptions. Additionally, the U.S. revoked the Iran oil waiver, halting legal purchases and transportation of Iranian oil.

Markets are pricing in a 28% chance of a 25 basis point rate hike at the upcoming FOMC meeting on July 28-29.

Global equity markets posted gains, with the Euro Stoxx 50 rising +0.83%, China’s Shanghai Composite rebounding from a one-month low to close +1.65%, and Japan’s Nikkei-225 advancing +1.38%.

Interest Rates

September 10-year T-notes (ZNU6) rose +3 ticks, with the 10-year yield declining -1.6 basis points to 4.563%, driven by safe-haven demand amid U.S.-Iran tensions. However, gains were tempered by resilient labor data and a $22 billion 30-year Treasury auction later in the day. European bonds showed mixed performance, with Germany’s 10-year bund yield climbing to a 1.5-month high of 3.104% (+1.2 basis points) and the U.K. 10-year gilt yield falling -4.0 basis points to 4.934%.

German trade data presented a mixed outlook, with May exports rising +0.9% month-over-month, defying forecasts of a -0.4% decline, while imports fell -2.5% versus expectations of a -0.8% drop.

Markets are assigning a 14% probability of a 25 basis point ECB rate hike at its next policy meeting on July 23.

U.S. Stock Movers

Semiconductor and AI infrastructure stocks surged, bolstering broader market sentiment. The iShares Semiconductor ETF (SOXX) closed +2%, with Lam Research (LRCX) leading S&P 500 gainers at +10%, followed by Applied Materials (AMAT), KLA Corp (KLAC) at +9%, ARM Holdings (ARM) +8%, and Marvell Technology (MRVL), Micron Technology (MU), Western Digital (WDC) +7% each. Seagate Technology (STX) and SanDisk (SNDK) rose +6%, while Advanced Micro Devices (AMD) and Intel (INTC) climbed +5%.

Trucking sector stocks advanced after a Citigroup upgrade, with FedEx Freight (FDXF) +5%, Old Dominion Freight Line (ODFL), Knight-Swift Transportation (KNX) +3%, and ArcBest (ARCB), JB Hunt Transport (JBHT), Saia Inc (SAIA) +2%. Marten Transport (MRTN), CH Robinson (CHRW), United Parcel Service (UPS), and XPO Inc (XPO) gained +1%.

Software stocks faced renewed pressure, with Palantir Technologies (PLTR) -3%, Salesforce (CRM) -2%, and Workday (WDAY), Intuit (INTU), ServiceNow (NOW), Thomson Reuters (TRI), Autodesk (ADSK), Microsoft (MSFT) down -1% each.

Alnylam Pharmaceuticals (ALNY) surged +12% to top Nasdaq 100 gainers after competitors AstraZeneca and Ionis Pharmaceuticals plunged following a failed late-stage trial of their Wainua drug. Ionis (IONS) dropped -20%.

Ceco Environmental (CECO) rose +4% after JPMorgan Chase began coverage with an “overweight” rating and a $130 price target.

Cerebras Systems (CBRS) advanced +3% after announcing plans to expand European AI infrastructure to 200MW by end-2027, though Goldman Sachs downgraded the stock to “sell” with a $19 price target.

Paramount Skydance (PSKY) fell -8% after Arete Research cut its rating to “sell” with a $2 target.

PepsiCo (PEP) declined -4% after reporting Q2 operating profit of $4.02 billion, below the $4.06 billion consensus.

Granite Construction (GVA) dropped -4% following a Goldman Sachs downgrade to “sell” and a $139 price target.

International Business Machines (IBM) slid -2% in the Dow after Starbucks announced AI-driven in-house tools to replace IBM software. Meta Platforms (META) fell -2% after reports of plans to manufacture its own AI chip in September.

Mattel (MAT) dipped -2% after Goldman Sachs lowered its rating to “sell” and set a $12 price target.

Earnings Reports

Companies reporting earnings on July 9, 2026, included Immersion Corp (IMMR), Nurix Therapeutics Inc (NRIX), PepsiCo Inc (PEP), Simply Good Foods Co (SMPL), Simulations Plus Inc (SLP), and WD-40 Co (WDFC).

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