US stocks today: Nasdaq rallies to sharply higher close; chip surge offsets Iran worries

Tehran said it hit U.S. military targets in Kuwait, ‌Qatar and Bahrain following ⁠U.S. ⁠strikes against Iran on Wednesday. The PHLX chip index surged for a second straight positive session.

Micron Technology jumped after the companylaid out plans ​to invest more than $250 billion in the U.S. through 2035, to benefit from demand for memory chips to supply ​the boom in artificial intelligence.

Applied Materials and Sandisk also surged.

AI-related stocks have been volatile lately as investors worried about the sustainability of a rally that has helped Wall Street reach record levels in 2026.

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“This ​is still very much an AI bull market. For a bit, ⁠it was starting ‌to broaden out, but that’s contingent on oil prices and interest rates staying ​anchored, and with ​this flare-up in the Middle East, that calls that part of the bull ⁠market into question,” said Ross Mayfield, investment strategy analyst at Baird in ​Louisville, Kentucky.
Meta Platforms rose after Reuters reported that the company plans to manufacture ​AI chips starting in September.According to preliminary data, the S&P 500 gained 59.12 points, or 0.79%, to end at 7,541.83 points, while the Nasdaq Composite gained 328.11 points, or 1.27%, to 26,198.76. The Dow Jones Industrial Average rose 133.31 points, or 0.25%, to 52,481.70.

With quarterly reporting season set to get under way, analysts on average expect S&P 500 earnings to increase 24% year-over-year, with technology companies accounting for much ‌of that increase, according to LSEG I/B/E/S.

The S&P 500 is trading at about 20 times expected earnings, down from 21 a month ago.

The number of Americans filing claims ​for unemployment benefits ​fell last week, suggesting the ⁠labor market remained stable despite a slowdown in job growth in June.

The Federal Reserve kept interest rates unchanged at its June meeting, under new Chair Kevin Warsh, but minutes released on Wednesday showed a few ​policymakers saw a case for raising borrowing costs before ultimately agreeing to hold steady.

Traders are pricing in a likely 25-basis-point rate hike by the Fed’s December meeting, according to CME’s FedWatch tool. PepsiCo fell despite the snacks and soda giant beating second-quarter revenue estimates.

Costco Wholesale’s shares sank to a six-month low after the retailer reported decelerating comparable sales for June.