On Thursday, June 19, US equities shifted back toward the AI chip trade after the temporary US-Iran agreement was formally signed in Geneva. Three Saudi supertankers crossed the Strait of Hormuz on the same day, easing the geopolitical premium that had supported oil and energy shares. The positive geopolitical news outweighed the previous day’s hawkish FOMC shock: the S&P 500 rose more than 1%, the Nasdaq gained nearly 2%, the Dow posted its third record close of the week, and the Philadelphia Semiconductor Index jumped more than 6% to a fresh all-time high. Energy was the only losing sector of the session as oil prices moved lower.
Indexes Recover Most of the FOMC-Driven Decline
The S&P 500 closed up 1.08% at 7,500.58, the Nasdaq advanced 1.91% to 26,517.93, the Dow gained 0.14% to 51,564.70, and the Russell 2000 led with a 2.12% rise to 2,979.77. The pattern of gains, strongest in small caps and weakest in the Dow, showed that the rebound was led by higher-beta names that had suffered the most over the previous two sessions. Defensive and blue-chip stocks did not keep pace.
The US-Iran headlines had largely been priced before the opening bell, and the indexes moved steadily higher through the session. By the close, they had recovered most of the decline triggered by the prior day’s FOMC reaction. Capital rotated out of defense and energy and back into technology, consumer discretionary, and industrials. The speed of that rotation suggested that money that left technology stocks after the FOMC shock had not fully exited the market; it was waiting for a reason to re-enter.
Intel, Apple, Nvidia and the Wider Semiconductor Chain
In a post on Truth Social before dawn, Trump confirmed that Apple and Intel had reached a design and foundry cooperation agreement. Intel will initially handle mature-node chips for iPads and older iPhone models, while flagship products will continue to be supplied by TSMC. The negotiations had been under way for more than a year. For Intel’s foundry business, the agreement brings in a major external customer; for Apple, it diversifies reliance on TSMC. Neither company issued a formal response, and the market was pricing the directional significance of the deal.
The same Trump post also said Nvidia had agreed to produce its first chips at Intel and that Musk had committed to co-building TerraFab, described in the source as the largest wafer fab in history. The Apple cooperation formed the third piece of Intel’s foundry map. Intel closed up about 10.5% at $133.82. Apple’s plan to raise prices because of higher memory and storage chip costs also lifted the storage supply chain: SanDisk gained more than 11%, Micron rose nearly 9%, and Nvidia climbed nearly 3%. The Philadelphia Semiconductor Index advanced more than 6% to a record high, with equipment, storage, and compute-related names all moving higher. The market continued to price the long-term AI capital expenditure theme even after the hawkish dot plot had landed.
SpaceX moved in the opposite direction, falling 3.56% to $185.00 and closing lower for a second consecutive session. Its two-day decline reached about 8.3%. Bloomberg reported that the company was preparing to issue at least $20 billion of investment-grade dollar bonds to repay a bridge loan maturing in 2027. Concerns over equity dilution, together with the hawkish FOMC impact, created the dual pressure behind the two down days. SpaceX was still up nearly 15% for the week and 37% above its IPO-day offering price, but short-term pressure had not yet cleared.
Energy Leads Losses as WTI Falls to a Three-Month Low
Energy was the weakest of the 11 S&P sectors. WTI crude fell about 2% on the day to $74.29 per barrel, marking a near three-month low. Exxon Mobil and Chevron both declined, while the Dow Transports fell more than 4%. The reopening of Hormuz released the geopolitical premium that had built up in oil and energy shares. Energy shifted from the week’s biggest winner to the day’s biggest loser, and earlier year-to-date gains of 20% to 40% began to loosen.
Macro assets also showed a rapid cooling in fear. The VIX dropped 11.06% to 16.40, indicating that the panic triggered by the FOMC the day before had largely faded within a single session. The 10-year US Treasury yield slipped slightly to around 4.445%, while the 2-year yield stayed above 4.18%. The market did not withdraw its pricing for a September rate hike; volatility was simply suppressed for the moment by improved risk appetite. Gold fell to $4,210 per ounce, silver also moved lower, and the US Dollar Index edged down while remaining elevated. According to CoinGecko, Bitcoin closed near $64,026 and Ethereum near $1,734. Crypto markets showed no clear reaction to the geopolitical improvement, as pressure from hawkish rate expectations remained in place. WTI closed at $74.29 per barrel, its lowest level in nearly three months.
PCE, Flash PMI, Micron Earnings and Russell Reconstitution
Next week’s calendar includes PCE data, Flash PMI, and Micron earnings. Micron’s guidance is treated in the source as the most direct barometer of AI compute demand. In the previous quarter, one weaker-than-expected guidance update dragged the entire semiconductor sector sharply lower in a single session. Russell Reconstitution will take effect at next Friday’s close, and mechanical rebalancing flows are set to expand trading volume sharply while lifting volatility in small-cap stocks.
TechFlow’s Chaoxiang Research framed Thursday’s rebound as having two legs: the US-Iran signing released the geopolitical premium, and the chip rally confirmed that the AI theme remained intact. The two drivers have different durability. The geopolitical premium is a one-time release once the agreement is signed, and if Iran reverses course later, the market would react faster and more violently than it did the first time. The chip logic is more durable: the joint rally in Intel, SanDisk, and Micron showed that the day’s move had supply-chain breadth and that AI capital expenditure pricing still had fundamental support.
The report also highlighted a new variable behind SpaceX’s two-day decline. If the $20 billion bond issuance is completed, financing pressure and dilution expectations would become a continuing constraint on the share price rather than a simple valuation adjustment. The nearest test is next week’s PCE data. If the data again comes in above expectations, a September rate hike would move from probability toward consensus, making Thursday’s rebound look more like a pause for breath. If the data weakens, the market’s repricing of rate-cut expectations would accelerate quickly.