U.S. stocks rose Tuesday and broke a three-day losing streak, with the Dow Jones Industrial Average up 0.74%, the S&P 500 gaining 0.89%, and the Nasdaq Composite climbing 1.29%. Technology names led the rebound, especially chipmakers and AI hardware stocks. Many of the shares that had sold off the hardest in recent sessions posted the strongest bounce.
The recovery did not erase concerns about the market’s underlying condition. BTIG strategist Jonathan Krinsky said the headline gain looked less healthy beneath the surface because advancing stocks did not clearly outnumber decliners and volume stayed light. Goldman Sachs said high-volatility technology stocks had dropped by as much as 33% in a short span and were already deeply oversold. Tuesday’s move was amplified by short covering, as traders who had bet on more downside were forced to buy back shares. Goldman Sachs and UBS said the momentum selloff may be close to ending and that investors could start rebuilding positions in AI and semiconductor names. BTIG took a more cautious line and said the rebound was nearing resistance levels, making aggressive chasing risky in the short term.
Oil, gold and yields moved higher as U.S.-Iran tension escalated
Tension between the United States and Iran continued to rise. According to the report, U.S. forces struck targets inside Iran for an 11th straight night. Donald Trump again threatened a possible strike on underground Iranian nuclear facilities, while Iran warned that continued U.S. attacks could trigger retaliation against U.S. and allied interests in the region.
Markets focused on the risk of disruption in the Strait of Hormuz and Red Sea shipping lanes. Brent crude climbed back above $91 a barrel, the highest level since mid-June, while WTI moved above $85 a barrel. Gold rose alongside oil and moved above $4,130, and spot silver at one point gained about 5% and approached $60.
Goldman Sachs warned that Brent could reach $120 if disruption in the Strait of Hormuz lasts into the fourth quarter. The International Energy Agency also said energy supply security should not be taken lightly as conflict intensifies and commercial inventories decline.
The move in oil revived inflation fears and hit the bond market. The 10-year U.S. Treasury yield jumped to 4.63%, a two-month high. The 2-year and 30-year yields rose to 4.25% and 5.13%, respectively. The U.S. Dollar Index strengthened to 101.3, while the dollar-yen pair broke through 163, a level the report described as the weakest yen since 1986. RBC Capital Markets rate strategist Izaac Brook said sustained gains in energy prices were the main driver of higher yields, and that a break above 4.20% in 2-year yields and 4.60% in 10-year yields was magnified by thin summer liquidity.
Tariff signals added another source of pressure
The U.S. trade representative signaled that Washington could soon introduce a new tariff policy to replace the global 10% import tariff that is nearing expiration. The new plan could impose tariffs of 10% to 12.5% on 60 countries and regions under what the report described as a “forced labor” rationale.
Trump also said imported generic drugs would keep a zero-tariff treatment for two years starting Aug. 1, 2026, after which tariffs would first rise to 100% and then to 200%. The stated aim is to bring drug manufacturing back to the United States.
For markets, the issue is straightforward: tariffs can raise corporate costs and push up prices for some goods, which in turn makes inflation harder to bring down and can squeeze profit margins.
Memory chips led the rally as semiconductors bounced hard
Semiconductors were the strongest group in the market, with memory names at the center of the move. The Philadelphia Semiconductor Index rose 5.21%, its largest one-day gain since June 22. The VanEck Semiconductor ETF added 4.52% and the iShares Semiconductor ETF gained 5.45%. A memory-chip and hardware supply-chain index rose more than 11%, while the Roundhill memory ETF jumped 10.91%. A long list of stocks in the segment posted gains of more than 10%.
The report pointed to three main reasons for the sudden jump in memory-chip shares. First, the group had already fallen sharply, creating room for a technical rebound and forcing short sellers to cover. Second, Wall Street has turned more constructive again on AI-driven memory demand. Morgan Stanley said data-center memory shortages are getting worse and may last until 2028, with memory prices rising at least 25% from the second quarter to the third quarter. Third, China’s open-source AI model Kimi K3 has opened up a new demand narrative. Bank of America analyst Vivek Arya said a growing number of open-source models could encourage companies and developers to deploy models themselves, increasing demand for HBM, DRAM and NAND.
The shift in interpretation matters. Earlier, the market had worried that lower-cost AI could reduce chip demand. The report said Wall Street is now looking at the issue from another angle: open-source AI may broaden adoption and increase the need for both memory and compute. LPL Financial chief technical strategist Adam Turnquist said the selloff looked more like a healthy correction after a rapid run-up than a breakdown in AI fundamentals. What investors will watch next, he said, is whether heavy data-center spending can generate returns.
Micron and other storage names posted double-digit gains
Micron Technology rose 12.17% and stood at the center of the memory rebound. The report said its market capitalization returned above the $1 trillion mark. Bank of America’s research note was described as a direct catalyst, tied to expectations that open-source models such as Kimi K3 could drive local deployment demand and increase orders for HBM, DRAM and NAND. Morgan Stanley also said data-center memory shortages are likely to persist.
Other storage-related names moved with it. SanDisk rose 14.27%, SK Hynix gained 13.75%, Western Digital added 12.51%, and Seagate Technology climbed 11.14%.
Nvidia, AMD and Intel all advanced
Nvidia rose 1.97%. Ahead of AMD’s AI event, the company updated investors on the Vera Rubin platform and said Vera Rubin NVL72 is ramping global mass production. CoreWeave, Google Cloud, Microsoft Azure and Oracle Cloud have already begun deployments, according to the report. CoreWeave test data showed the new system delivered a 10x jump in token throughput per megawatt compared with the prior generation. Nvidia also said its Vera CPU was delivered in June to OpenAI, Anthropic and SpaceX. CoreWeave rose 8.92%.
AMD gained 8.11% before its AI event later this week, as investors positioned for updates on AI chips and the rack-scale AI system Helios. The report said AMD is trying to compete with Nvidia by offering a full AI infrastructure stack spanning GPUs, CPUs, networking and software.
Intel rose 8.64%, helped by the semiconductor rebound and by a new partnership with cybersecurity company Fortinet to develop the next-generation SP6 security processor using Intel 4 process technology. The market viewed that as a positive signal for Intel’s foundry business in attracting external customers. Elsewhere in chips, TSMC rose 5.55% and Arm gained 7.46%.
AI infrastructure, cloud and optical networking names also moved higher
Super Micro Computer (SMCI) closed up 7.01% and jumped about 20% after hours. The report said fourth-quarter revenue guidance was near the low end of the range, but gross margin was raised sharply to 15%-17%, new orders topped $60 billion, and backlog reached a record.
Nebius surged 18.78% after Nvidia disclosed an equity stake of about 9.3%. The market took that as a sign that Nebius has won recognition inside Nvidia’s AI cloud ecosystem. Northland raised its price target on Nebius to $410 from $248 and kept its “outperform” rating, saying the company could capture about 14% of a long-term AI-as-a-service market it sized at $800 billion. Other cloud and compute names followed: CoreWeave rose 8.92%, Hut 8 gained 7.98%, and IREN added 2.71%.
Optical communications stocks also rallied. Applied Optoelectronics rose 12.76%, Coherent gained 11.15%, Lumentum added 9.41%, Ciena rose nearly 8%, Marvell Technology gained 6.68%, and Corning added 6.08%. The report said the logic was simple: AI data centers need not only GPUs, but also high-speed networks and optical modules to connect those systems.
SpaceX ended a seven-session slide as lockup date approached
SpaceX rose 3.08% and snapped a seven-day losing streak. The company is scheduled to release its first earnings report as a listed company on Aug. 4. On Aug. 6, it will face its first major share lockup expiration, with restricted stock worth about $116 billion set to become eligible for sale. Up to 911.5 million previously restricted shares could be unlocked.
S3 Partners estimated that short interest in SpaceX stands at about $25 billion, equal to roughly 32% of the float. Elon Musk responded by saying firms that remain heavily short SpaceX over the long term have a “very low probability of survival.” In related aerospace and defense trading, Rocket Lab rose more than 5% after hours after winning a $266 million U.S. Air Force suborbital launch contract.
Tesla, Google, Apple, Microsoft and nuclear power names stayed in focus
Tesla rose 2.53% ahead of its earnings release after the bell. Investors were watching vehicle deliveries, automotive gross margin, energy storage, progress on FSD and the company’s longer-term plans. The report said Tesla’s valuation has come under pressure recently and that earnings need to show the company can still tell an AI and energy growth story rather than be seen only as an electric-vehicle maker.
Google fell 1.38% after releasing lower-cost Gemini models including Gemini 3.6 Flash, Gemini 3.5 Flash-Lite and the cybersecurity-focused Gemini 3.5 Flash Cyber. The market, however, stayed focused on when the flagship Gemini 3.5 Pro will launch and whether AI spending can turn into revenue. Advertising, cloud, YouTube and AI capital expenditure are expected to be key items in the company’s results.
Apple rose 0.35%. According to the report, the company plans to launch an “Apple Upgrade” device subscription program on July 28, covering most iPhones, Macs, iPads and Apple Watches, with financing support from Klarna. Klarna jumped as much as 11% intraday before closing up 1.44%. The move was seen as a major shift in Apple’s sales model as it tries to lower the barrier to hardware purchases during a period of product price increases.
Microsoft fell 1.13%. The company expanded its partnership with French AI firm Mistral and signed a multibillion-dollar European AI infrastructure agreement. Microsoft will use Mistral’s expanded European GPU infrastructure to support cloud and AI services. The report said the stock decline appeared to reflect positioning ahead of earnings rather than a clearly negative read on the announcement itself.
AI-linked nuclear power names extended gains. Oklo rose 6.31% and added nearly 6% more after hours, while X-Energy gained 7.22% and rose more than 8% after the close. The Trump administration launched a $200 million AI nuclear acceleration plan, with Oklo and X-Energy selected and Microsoft and Nvidia also participating. The market’s read was that nuclear energy could become a long-term solution for the large electricity needs of AI data centers.
Danaher fell 10.99%. The company beat second-quarter revenue and profit expectations and raised its full-year earnings-per-share guidance, but investors focused on delayed order timing from biopharma customers.
What the market is watching next
- At 21:00 on July 22, Samsung will hold its global Galaxy product launch event. Markets are watching whether new devices carry more on-device AI features.
- From July 22 to July 23, AMD will host its “Advancing AI 2026” event. CEO Lisa Su is scheduled to speak, and the company is expected to present updates on AI chips and rack-scale AI systems. Investors are likely to compare AMD’s position with Nvidia’s and assess AI data-center revenue potential in 2026 and 2027. The report said strong guidance could extend the semiconductor rebound, while weaker-than-expected signals could cool the short-covering rally in chips.
- After the close in early July 23 trading, Google, Tesla, IBM, Texas Instruments and ServiceNow are scheduled to report earnings.