The US stock market recorded positive performance in trading on July 9, with the Nasdaq Composite index leading the gain by 1.3% to close at 26,206.89 points. Significant gains also occurred in the S&P 500 index by 0.8% and the Dow Jones Industrial Average, which rose 0.27%. This rally was driven by the tech and semiconductor sectors, which managed to brush off market concerns over escalating conflict in the Middle East and potential long-term inflationary pressures.
Positive market sentiment was partly driven by a massive investment commitment from memory chip maker Micron Technology, which announced spending plans of over US$250 billion through 2035 to boost production capacity for artificial intelligence (AI) support chips. In addition, Meta Platforms shares also rose in response to the company's plan to develop its own AI chips starting next September. Sector-wise, the information technology sector led the gains with a growth of 1.65%.
Although the tech rally continues to dominate, analysts remain cautious regarding energy price uncertainty and Federal Reserve interest rate policies. The heating geopolitical situation following military escalation in the Middle East remains a risk factor closely monitored by investors. On the other hand, market participants are now looking forward to the second-quarter earnings reporting season, with corporate revenue growth projections for S&P 500 index companies averaging 24% year-on-year.
US domestic economic data offered mixed signals; a decline in jobless claims showed labor market stability, but the market continues to adjust expectations regarding monetary policy. According to CME Group FedWatch data, investors are now anticipating a potential 25 basis point rate hike in December following hawkish signals from several US central bank officials in the latest policy meeting minutes.
