Wall Street pushed higher on Thursday as a sharp rebound in semiconductor stocks and a retreat in oil prices carried the major indexes back into the green, even as the United States and Iran traded fresh military blows across the Middle East. The Nasdaq Composite led the advance, closing up 1.30%, or 336.24 points, at 26,206.89. The S&P 500 rose 0.81%, or 60.93 points, to 7,543.64. The Dow Jones Industrial Average added 139.02 points, or 0.27%, to 52,487.41. The small-cap Russell 2000 gained 1.22%, or 36.15 points, to 2,992.54, nearly matching the Nasdaq’s pace after lagging badly the day before.

The bounce reversed part of a punishing Wednesday, when the Dow shed 576.76 points, or 1.09%, and the S&P 500 slipped 0.28% after President Donald Trump told the NATO summit in Turkey that the U.S. ceasefire with Iran was over and oil prices spiked. Thursday brought no letup in the fighting — the U.S. launched airstrikes on roughly 90 Iranian targets and Tehran retaliated against U.S.-allied Gulf countries, according to reports cited by the Associated Press — yet investors chose to look through the conflict and back toward the artificial-intelligence spending boom that has driven equities all year. The willingness to buy despite the headlines marked a shift from the risk-off crouch of the prior session.

The clearest expression of that mood was in chips, which had been the market’s biggest drag earlier in the week. The iShares Semiconductor ETF climbed more than 5%, and a broader Bloomberg gauge of chipmakers rose about 4%. Micron Technology jumped 4.5% after announcing plans to spend as much as $250 billion building new U.S. plants to meet AI-driven demand. Sandisk popped 7.6%. The rally helped repair some of the damage in the PHLX Semiconductor Index, which had fallen roughly 16% from its June 22 peak and dropped below its 50-day moving average for the first time since early April. Notably, the pivot came at the expense of the megacap “hyperscalers”: the Roundhill Magnificent Seven ETF slipped 0.6% as money rotated out of the largest AI platform names and into the chipmakers that supply them.

Much of the day’s attention centered on SK Hynix, the South Korean memory giant set to price its U.S. offering Thursday and begin trading Friday. Demand ran hot, with the listing reported to be more than seven times oversubscribed, and the stock closed 5.3% higher in Seoul ahead of the debut — a fresh signal that appetite for anything tied to AI memory and data-center buildout remains strong even against a wartime backdrop.

Market movers. PepsiCo fell 1.8% to about $140 after mixed second-quarter results. The company posted adjusted earnings of $2.20 a share, a penny short of the $2.21 analysts expected, though revenue rose 6.4% from a year earlier to $24.18 billion on strong international sales. Drug stocks swung hard on trial data: Ionis Pharmaceuticals tumbled about 21% and British partner AstraZeneca dropped nearly 8% — its worst day since March 2020 — after their heart-disease drug Wainua failed to meet its primary goal in a late-stage study, while Alnylam Pharmaceuticals surged 17.5%. Defense contractor CACI International fell 7.7%. Among analyst calls, Citi‘s Jason Basinet cut his Netflix price target to $100 from $115 but kept a buy rating, citing soft viewership and the market’s shift toward semis. KeyBanc Capital Markets downgraded Salesforce to sector weight from overweight and pulled its target, saying it saw no clear momentum catalyst. S&P Global Ratings downgraded Oracle one notch to BBB-, the lowest rung of investment grade, on rising business risk and weaker cash flow, though the stock still advanced.

Commodities and volatility. Oil gave back a chunk of Wednesday’s surge as traders weighed whether the flare-up stays contained. Brent crude fell more than 2% after topping $78 a barrel the day before, and West Texas Intermediate slid toward $72. The CBOE Volatility Index, Wall Street’s fear gauge, dropped 6.3% to 15.84 after jumping to 16.90 on Wednesday. Gold rose about 1.2% to roughly $4,132 an ounce as some investors kept a safe-haven hedge in place. In the bond market, Treasury yields held firm rather than retreating: the 30-year yield stayed above the 5% mark at about 5.08%, reflecting lingering worry that renewed energy-price pressure could keep inflation sticky — the same concern flagged in minutes from the Federal Reserve’s June meeting, which showed some policymakers open to another rate hike if price growth stays elevated.

On the economic calendar, the National Association of Realtors reported that existing-home sales unexpectedly fell in June, a reminder that higher-for-longer rates continue to weigh on housing even as equities climb.

Overseas markets firmed alongside New York. The pan-European Stoxx 600 closed up about 0.8%, led by basic resources up 3.2% and technology up 2.8%. Germany’s DAX rose 0.83%, France’s CAC 40 gained 0.9% and Italy’s FTSE MIB added 1.1%, while the U.K.‘s FTSE 100 slipped 0.2%. In Asia, Japan’s Nikkei 225 rose 1.4%, South Korea’s Kospi added 0.62%, mainland China’s CSI 300 gained 2.5% and Hong Kong’s Hang Seng fell 0.5%.

The unresolved question is whether the market’s composure lasts. Some strategists warned that investors may be growing numb to an on-again, off-again conflict that still carries real economic weight. Vikas Dwivedi, global energy strategist at Macquarie Group, said he expects the tensions to prove relatively short-lived because both countries face practical limits, but cautioned against chasing the rally given a large underlying oversupply in oil that he said leaves room for prices to fall once the current standoff eases. Others put inflation at the center of the risk: renewed Middle East pressure on energy, stacked on top of heavy AI investment and resilient consumer spending, could keep price growth stubborn through the back half of the year and leave the door open to a Fed rate increase before December.

For now, the focus turns to Friday’s SK Hynix debut and to next week, when June’s Consumer Price Index and congressional testimony from Fed Chair Kevin Warsh land alongside the first big bank earnings, including JPMorgan Chase.

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