US stock markets, Wall Street, recorded green territory at the open of trading on Tuesday (7/21). This rally was mainly driven by dip-buying in semiconductor industry stocks, amid investor caution ahead of Q2 earnings releases from global tech giants.
The Nasdaq Composite Index led the gains, surging 1.04 percent to 25,772.55. A similar trend was followed by the S&P 500, which rose 0.63 percent to 7,489.95, and the Dow Jones Industrial Average, which edged up 0.15 percent to 51,916.79. Market enthusiasm was fueled by a 4.1 percent surge in the iShares Semiconductor ETF during the pre-market session, signaling a resurgence in the chipmaker sector previously dragged into bear market territory.
Market participants' attention is now focused on the earnings reports of Alphabet and Intel. Investors are seeking clarity regarding the effectiveness and capital expenditure (capital expenditure) commitments in artificial intelligence (AI) development. Spending certainty from these hyperscaler companies is considered crucial to support valuations and sustain the long-term rally in the tech sector.
However, positive market sentiment was temporarily tempered by geopolitical escalation in the Middle East. Despite initial signals of a proposed ceasefire between the US and Iran, actions by the Houthi group announcing a naval blockade against Saudi Arabia threaten to open a new conflict. This situation immediately pushed Brent crude prices up toward $90 per barrel due to fears of global energy supply disruptions.
Market dynamics were further complicated by US President Donald Trump's protectionist policies imposing a 50 percent import tariff on various Canadian products. Among individual stocks, price movements were mixed; 3M shares surged 6.3 percent following an increase in its annual profit forecast, while software companies like Adobe and Salesforce dropped more than 4 percent due to downgrades from rating agencies.
