Stocks Climb as Rebound in Chipmakers Gathers Pace: Markets Wrap

(Bloomberg) — Wall Street staged a comeback as dip buyers emerged, lifting stocks amid rally in chipmakers on bets the artificial-intelligence trade that’s powered the bull market has more room to run.

The bounce in semiconductor powerhouses followed a selloff that drove the group to a bear market last week. A key industry gauge climbed 3.5%. The Nasdaq 100 added 1.2%. Those tech gains overshadowed ongoing geopolitical threats that kept boosting oil prices while stoking concerns about inflationary pressures that could make the Federal Reserve raise rates. Bond yields rose.

The sharp slide in momentum stocks may be nearing its end, creating an opportunity for investors to start rebuilding positions in AI and semiconductor shares, according to UBS’ trading desk.

Part of the reason the sector may be finding a floor is that much of the speculative positioning has already been unwound. Hedge funds have cut long positions in momentum and semiconductor stocks by about 5% of gross market value, one of the largest reductions on record, according to UBS’ prime brokerage data.

“The recent correction appears more consistent with a healthy reset following a parabolic advance than a fundamental breakdown in the AI investment theme,” said Adam Turnquist at LPL Financial.

Still, pressure is building for companies to justify their AI spending. With skepticism mounting about the hundreds of billions of dollars being poured into data-center development, earnings reports over the next two weeks will be scoured for evidence that the investments are generating bigger returns. Tesla Inc. and Alphabet Inc. kick off big tech’s reporting season on Wednesday.

The next two weeks will be a defining stretch for earnings, and not just for tech. The broader message is already clear: companies that fail to clear Wall Street’s elevated bar are being punished, according to Bret Kenwell at eToro.

“The burden of proof has changed. Investors are no longer asking whether companies can withstand the uncertainty,” he said. “They want growth and guidance strong enough to justify elevated valuations.”

Corporate Highlights:

3M Co. topped Wall Street’s profit expectations and raised its full-year outlook, a sign that the conglomerate’s slow-and-steady turnaround effort is proceeding despite broader economic volatility. General Motors Co. raised its full-year profit forecast by another $500 million after beating earnings estimates, powered by stronger margins on its largest vehicles and lower tariff costs. Hasbro Inc. reported revenue that beat expectations and raised its full-year outlook based on the strength of its Magic: The Gathering card game business. Halliburton Co. reported adjusted operating income of $683 million for the second quarter, below average analyst estimate. But the company said it sees incremental growth in North American activity throughout the year as drilling and fracking pick up in the US. Novo Nordisk A/S sued Eli Lilly & Co., accusing its rival of misleading advertising as competition in the US market for obesity drugs ratchets up further. Some of the main moves in markets:

Stocks

The S&P 500 rose 0.4% as of 10 a.m. New York time The Nasdaq 100 rose 1.2% The Dow Jones Industrial Average rose 0.3% The Stoxx Europe 600 was little changed The MSCI World Index rose 0.5% Currencies

The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1411 The British pound fell 0.4% to $1.3380 The Japanese yen fell 0.2% to 162.87 per dollar Cryptocurrencies

Bitcoin rose 2.1% to $66,723.48 Ether rose 1.8% to $1,938.42 Bonds

The yield on 10-year Treasuries advanced four basis points to 4.63% Germany’s 10-year yield advanced three basis points to 3.18% Britain’s 10-year yield advanced one basis point to 5.05% Commodities

West Texas Intermediate crude rose 2.5% to $85.28 a barrel Spot gold rose 1.1% to $4,050.98 an ounce ©2026 Bloomberg L.P.