On Thursday, June 19, the main thread in US equities shifted back from geopolitical risk to AI chips. A temporary US-Iran agreement was formally signed in Geneva, and three Saudi supertankers crossed the Strait of Hormuz on the same day. That development released the geopolitical premium and helped overshadow the hawkish shock from the previous day’s FOMC meeting. The S&P 500 rose 1.08% to 7,500.58, the Nasdaq gained 1.91% to 26,517.93, the Dow added 0.14% to 51,564.70, and the Russell 2000 led major indexes with a 2.12% rise to 2,979.77. Gains tapered from small caps to large caps, while the Dow was nearly flat, showing that the rebound was led mainly by high-beta names that had been hit hardest over the prior two sessions. Defensive and blue-chip names did not follow with the same strength.
Chip stocks rally as Intel takes center stage
The US-Iran news had largely been priced before the open, and the major indexes moved steadily higher through the session. By the close, they had recovered most of the losses caused by the FOMC shock. Early in the morning, Donald Trump confirmed on Truth Social that Apple and Intel had reached a design and foundry cooperation agreement. Intel will initially take on mature-node chips for iPads and older iPhone models, while Apple’s flagship products will continue to be supplied by TSMC. Negotiations had been ongoing for more than a year. For Intel Foundry, the deal brings in a heavyweight external customer; for Apple, it diversifies dependence on TSMC. Neither company had issued an official response, and the market was pricing the directional significance of the cooperation.
In the same post, Trump also said that Nvidia had agreed to produce its first chips at Intel, while Elon Musk had committed to jointly building TerraFab, described in the source as the largest wafer fab in history. The Apple cooperation was presented as the third piece in Intel’s foundry map. Intel closed up about 10.5% at $133.82. Apple is preparing to raise prices because of rising memory and storage chip costs, and that supported related names: SanDisk rose more than 11%, Micron gained nearly 9%, and the broader storage supply chain moved higher. Nvidia advanced almost 3%, while the Philadelphia Semiconductor Index climbed more than 6% in a single day and set another record high. The rally stretched across equipment, storage, and compute, showing that the longer-term AI capital expenditure thesis remained in place after the hawkish dot plot.
Energy reverses sharply while SpaceX faces financing pressure
Energy stocks moved in the opposite direction and became the weakest of the S&P 500’s 11 sectors. WTI crude fell about 2% on the day to $74.29 per barrel, marking a nearly three-month low. Exxon Mobil and Chevron both declined, and the Dow transportation index dropped more than 4%. The reopening of the Strait of Hormuz released the geopolitical premium that had previously supported the sector. Energy stocks, which had gained between 20% and 40% year to date in some cases, began to loosen, turning the sector from the week’s biggest winner into its biggest loser.
SpaceX closed down 3.56% at $185.00, its second consecutive daily decline. Over the two sessions, the stock fell by about 8.3%. Bloomberg reported that the company was preparing to issue at least $20 billion of investment-grade US dollar bonds to repay a bridge loan due in 2027. Concerns over equity dilution, together with the hawkish FOMC impact, created a double pressure behind the two-day slide. Even after that decline, SpaceX was still up nearly 15% for the week and 37% above its IPO-day issue price, but short-term pressure tied to financing had not disappeared.
Volatility retreats; crypto shows little response
Volatility fell sharply. The VIX dropped 11.06% to 16.40, indicating that the fear generated by the FOMC had largely faded within one day. The 10-year US Treasury yield edged down 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; rather, improved risk appetite temporarily compressed volatility. Gold fell to $4,210 per ounce, silver also moved lower, and the US dollar index slipped modestly while remaining elevated. In crypto, CoinGecko data showed Bitcoin near $64,026 and Ether near $1,734. The digital asset market did not show a clear response to the geopolitical relief, and pressure from hawkish expectations had not been removed.
Across equity sectors, technology, consumer discretionary, and industrials led the advance. Capital rotated away from defensives and energy and back toward the compute chain. Money that had left tech stocks because of the FOMC shock partly returned on the back of the geopolitical positive news, suggesting that this capital had not truly exited the market but was waiting for a reason to re-enter. Next week will bring PCE data, Flash PMI, and Micron earnings. In the source article, Micron’s guidance is described as the most direct barometer for AI compute demand; in the previous quarter, guidance that came in below expectations 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 will significantly increase trading volume, with small-cap volatility set to rise at that time.
TechFlow’s view: two drivers with different durations
In the “Chaoxiang Research” view cited by TechFlowPost, Thursday’s rebound stood on two legs: the US-Iran signing released the geopolitical premium, and chip stocks confirmed through actual price gains that the AI theme was still intact. Both drivers worked, but their duration differs. The geopolitical premium is a one-off event; once the agreement is signed, that pricing is largely realized. If Iran changes course later, the market response will be faster and stronger than the first time. The chip-stock logic is more durable. The simultaneous rise of Intel, SanDisk, and Micron showed that the day’s market had supply-chain breadth, and pricing for AI capital expenditure had fundamental support.
The source also highlighted a new variable behind the two-day decline in SpaceX: once the $20 billion bond issuance is completed, financing pressure and dilution expectations could become a lasting constraint on the share price, rather than merely a valuation adjustment. The nearest test is next week’s PCE data. If the data again comes in above expectations, the September rate hike could move from probability to consensus, and Thursday’s rebound would only be a breathing pause. If the data softens, the repricing of rate-cut expectations would happen at a very fast pace. The original article was published by TechFlowPost under its US equity trend coverage, written by Chaoxiang Research, and also listed TechFlow’s Telegram subscription group, official Twitter account, and English Twitter account BlockFlow_News.