Stocks closed modestly higher on Wednesday, capping a third straight day of gains before investors got hit overnight with a wave of conflicting signals from the biggest names in technology.
The S&P 500 rose 0.28% to close at 7,743.98, the Nasdaq Composite gained 0.27% to finish at 26,549.85, and the Dow Jones Industrial Average added 0.19% to end at 52,475.10. During the regular session, the so-called Magnificent Seven technology stocks were mixed: Alphabet and Amazon both rose, while Microsoft, Tesla, Apple, Nvidia and Meta all slipped slightly, setting the stage for a dramatic reversal once earnings landed after the bell.
The standout move of the day came from memory chip makers. The Philadelphia Semiconductor Index rose 1.75% to 11,684, and individual memory names surged on continued demand tied to artificial intelligence data centers. SK Hynix's U.S.-listed shares jumped 13.3%, SanDisk rose 7.66%, Silicon Motion gained 7.56% and Seagate advanced 4.51%, extending a rally that has made memory one of the strongest corners of the market this year.
Oil prices also stayed in focus. Brent crude has been trading in the neighborhood of 111 to 114 dollars a barrel, a level that has kept energy costs elevated for consumers and businesses alike. Separately, the Houthi movement, which calls itself Ansar Allah, claimed it struck Saudi Arabia's largest oil refinery with a ballistic missile, a development that has added to the uncertainty weighing on energy markets this week.
By Thursday morning, futures told a more cautious story. Nasdaq-100 futures were down 1.4% and S&P 500 futures fell 0.5%, while Dow futures rose 0.3%, as investors digested the mixed results from Microsoft and Alphabet overnight. In Asia, Japan's Nikkei 225 added 0.42% while the broader Topix slipped 0.38%. South Korea's Kospi fell 2.14% and the smaller Kosdaq dropped 2.75%, Australia's S&P/ASX 200 rose 0.46%, Hong Kong's Hang Seng was roughly flat, and mainland China's CSI 300 declined 1.2%.
With Amazon still to report this earnings cycle, investors will be watching whether the spending commitments driving the AI boom keep paying off in the stock market or start to wear on patience.
Why are memory chip stocks rallying so much?
Demand for memory chips used in AI data centers has been driving a strong rally in companies like SK Hynix, SanDisk and Micron.
Why are oil prices elevated right now?
Oil has been trading in the low 110s to mid 110s per barrel, with reports of an attack claimed on a major Saudi refinery adding to supply concerns this week.