Oil Price Slide Sends Stocks Soaring Despite Chipmaker Rout

The stock market saw an uptick on Thursday as the decline in oil prices outweighed the rout in chipmakers. Brent crude fell below $85, easing inflation worries and sending bond yields lower ahead of the Federal Reserve decision.

The S&P 500's equal-weighted version, which strips out market-value biases, hit record highs. The Dow Jones Industrial Average added 1.3%, while stocks rose on strong earnings and a drop in oil prices.

Investors are rotating from high-profile chipmakers to more economically sensitive industries, with riskier assets showing resilience despite a challenging inflation backdrop. This rotation has been driven by solid start-to-second-quarter earnings, rebounding US economic forecasts, lower equity valuations, and other positive catalysts, according to HSBC Holdings Plc strategists led by Max Kettner.

However, the recent decline in chipmakers underscores how quickly sentiment can turn on one of the market's most-crowded trades. It also sets a tough setup for earnings from megacaps like Microsoft Corp. and Meta Platforms Inc., due to report results this week.