Stocks Rise as Rebound in Chipmakers Gathers Pace: Markets Wrap
(Bloomberg) — Dip buyers extended a rebound in chipmakers, lifting global stock markets. Brent topped $90 a barrel as the US and Iran exchanged strikes for a 10th straight day.
A closely watched exchange-traded fund tracking chip stocks advanced 4% in premarket trading, with Nasdaq 100 futures rallying 1.3%. S&P 500 contracts climbed 0.4%. In Asia, strong export data from South Korea and Taiwan fueled gains in Samsung Electronics Co. and Taiwan Semiconductor Manufacturing Co. Tech also outperformed in Europe.
Buyers are picking up chip stocks at cheaper valuations after the sector suffered its worst week in more than a year. Chipmakers have been the biggest beneficiaries of the global rollout of artificial intelligence, but have been plagued by volatile trading as investors worry about lofty multiples and whether hyperscalers will sustain their spending.
UBS Group AG’s trading desk said the selloff in momentum stocks may be nearing its end, creating an opportunity for investors to start rebuilding positions in AI and chips.
“While volatility is likely to remain high given the elevated concentration still present in parts of the market, the correction has been both deep and lengthy enough to alleviate some valuation concerns,” said Santiago Mateo Yanguas, head of equity at CaixaBank AM.
The improvement in sentiment came despite another advance in oil prices Goldman Sachs Group Inc. analysts warned that Brent crude could rally to more than $120 a barrel by the fourth quarter.
Gold headed for its biggest advance in a week. Treasuries fluctuated, while the dollar was little changed.
In the UK, government bonds held steady as investors awaited fresh policy details from new Prime Minister Andy Burnham. Weak economic data dimmed bets on higher interest rates. The London Stock Exchange said it will open a new venue outside of its regular market hours.
Focus will soon shift to the start of the reporting season for Big Tech firms, where AI hyperscalers will update investors on their capital spending plans. Alphabet Inc. reports on Wednesday, while Microsoft Corp., Meta Platforms Inc. and Amazon.com Inc. are due next week.
“The next test is no longer whether AI demand exists, but whether pricing, margins and cash flow can justify the capex bill,” said Florian Ielpo, head of macro at Lombard Odier Investment Managers. “If they can, the rebound should broaden. Otherwise, volatility remains the regime.”
The question for investors is whether now is the time to sell chips and rotate toward hyperscalers, according to Alexandre Drabowicz, chief investment officer at Indosuez Wealth Management in Paris.
“Our view is that one needs to be invested in both,” Drabowicz said. “Alphabet’s earnings this week will be a real bellwether for the industry and its capacity to monetize AI. We believe the market underestimates how fast these companies will be able to monetize.”
What Bloomberg Strategists Say:
“The S&P 500 has effectively traded sideways for the past two months as investors weigh exceptional earnings expectations against signs of rising speculation. Whether this proves a healthy reset that allows the AI rally to extend, or the start of a more damaging unwind, will depend heavily on the reporting season.”
— Skylar Montgomery Koning, macro strategist. Click here for the analysis.
Corporate News:
General Motors Co. raised its full-year profit forecast by another $500 million after beating second-quarter earnings estimates, powered by stronger margins on its largest vehicles and lower tariff costs. TSMC has held discussions with clients about price increases of as much as 10% in 2027 to cover the rising cost of manufacturing materials, the Nikkei reported, citing people with knowledge of the matter. Paramount Skydance Corp. is facing a legal hurdle that risks putting its $110 billion takeover of Warner Bros. Discovery Inc. on hold for months. Novartis AG reported higher-than-expected profit last quarter as newer cancer medicines offset the aging blockbuster Entresto’s generic hit, signaling a return to growth. Some of the main moves in markets:
Stocks
S&P 500 futures rose 0.4% as of 7:34 a.m. New York time Nasdaq 100 futures rose 1.3% Futures on the Dow Jones Industrial Average rose 0.3% The Stoxx Europe 600 rose 0.2% The MSCI World Index rose 0.2% Currencies
The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1421 The British pound fell 0.2% to $1.3409 The Japanese yen fell 0.2% to 162.75 per dollar Cryptocurrencies
Bitcoin rose 1.4% to $66,217.04 Ether rose 1.4% to $1,931.79 Bonds
The yield on 10-year Treasuries was little changed at 4.60% Germany’s 10-year yield advanced one basis point to 3.16% Britain’s 10-year yield was little changed at 5.04% Commodities
West Texas Intermediate crude rose 1.6% to $84.55 a barrel Spot gold rose 1.3% to $4,059.22 an ounce This story was produced with the assistance of Bloomberg Automation.
–With assistance from Julien Ponthus and Christian Dass.
©2026 Bloomberg L.P.
