Investor confidence in AI infrastructure spending drives US equities higher, led by hyperscalers and semiconductor stocks.
The S&P 500 climbed 2% as markets embraced optimism over AI-related capital expenditures, with hyperscalers like Amazon and Google reinforcing expectations of long-term returns. Analysts noted that even modest gains from massive capex could solidify competitive moats for industry leaders, reducing pressure on valuations.
Chipmakers and DRAM names, including Micron and Sandisk, surged after recent lows, with forward earnings multiples near 5-6x seen as unsustainable for short sellers. Concerns lingered over potential commoditization of AI models, but demand for computing power and data centers remained a unifying theme.
Semiconductor stocks led the advance, while broader market sentiment shrugged off near-term risks, focusing on multi-quarter earnings visibility.