Micron’s stronger-than-expected earnings and raised guidance drive a broad rally in chip stocks and US equities.
US stock markets surged at the open Thursday after Micron reported earnings that surpassed Wall Street estimates and raised its guidance. The company’s shares jumped 18%, nearing an all-time high set last week, easing concerns about a potential demand slowdown in the memory chip sector.
Prior to the report, investors feared Micron’s results could signal weakness in the cyclical memory industry, raising broader questions about AI and capital expenditures. Instead, the positive print lifted the entire memory chip space, with Qualcomm also gaining 10% after an upgrade from Morgan Stanley and an expanded partnership with Hugging Face.
The S&P 500 rose 0.75% in early trading, supported by gains in banks following Fed stress test results. Goldman Sachs, Citigroup, Morgan Stanley, and Wells Fargo announced dividend increases, contributing to the sector’s modest 0.5% advance.