US Stocks Rise Despite Iran Tensions as Chipmakers Lead Charge
The US stock market indices ended higher on Thursday despite ongoing geopolitical tensions between the US and Iran. The S&P 500 rose 0.8%, while the Nasdaq 100 jumped 1.3% and the Dow Jones Industrial Average gained 0.3%. The rally was led by chipmaker stocks, which rebounded sharply ahead of SK Hynix's highly anticipated Nasdaq debut on July 10.
SK Hynix's listing was reportedly more than seven times oversubscribed, according to Bloomberg. However, some investors remain skeptical about the rapid increases in chipmaker and memory stock values, doubting their ability to meet booming demand.
Despite these concerns, major indices continued to rise, with the VanEck Semiconductor ETF (SMH) adding 2.5% and the Philadelphia Semiconductor Index (SOX) rising nearly 3%. The Vanguard Information Technology ETF (VGT) also jumped about 2%, driven by gains in Meta (META), Tesla (TSLA), Amazon (AMZN), and Apple (AAPL) stock.
Investors are split on the impact of geopolitical risks, with some focusing on the upcoming earnings season. Megan Horneman, chief investment officer at Verdence, warned that it's 'highly inflationary and highly uncertain' while Matt Maley at Miller Tabak believes investors are more focused on earnings than geopolitics.