U.S. stocks saw a significant increase on Thursday following President Trump’s decision to cancel a scheduled military strike on Iran, which helped semiconductor stocks recover from a recent downturn.
The Dow Jones Industrial Average surged by 929 points, or 1.9%, while the S&P 500 and Nasdaq gained 1.8% and 2.5%, respectively.
In a post on Truth Social, Trump stated, “Due to the consultations with the Islamic Republic of Iran being escalated to the highest levels of their leadership, I, as President of the United States, have called off the attack that was planned for this evening.”
He further mentioned that discussions have been “endorsed by all relevant nations, including the United States, Israel, Saudi Arabia, UAE, Qatar, Turkey, Pakistan, Bahrain, Kuwait, Jordan, Egypt, and others.”
On Thursday, the president informed the Post that a long-anticipated agreement to reopen the Strait of Hormuz and initiate nuclear discussions with Iran is “almost complete.”
Brent crude oil prices dropped by 2.9%, settling at $90.38 a barrel, while West Texas Intermediate decreased by 2.6% to $87.71 a barrel.
According to AAA, the national average gasoline price rose to $4.13 a gallon, a drop from last week but still nearly 40% above pre-war levels.
Earlier that day, investors were understandably anxious, as the U.S. and Iran had exchanged attacks for the second consecutive day. Trump had made a statement that the U.S. would strike Iran “very hard tonight” if no peace agreement was reached.
The president also indicated that the U.S. could soon take control of Kharg Island, which is crucial for Iran’s oil exports, along with “other oil infrastructure sites.”
The Bureau of Labor Statistics released its producer price index on Thursday, revealing that wholesale inflation in May reached its highest since November 2022, which dashed hopes for any rate cuts.
The news about the canceled airstrike relieved market tensions, allowing semiconductor and tech stocks to bounce back from recent losses.
Stocks for Micron Technology, Advanced Micro Devices, and Intel rose by 12%, 8%, and 9.3%, respectively, while Apple and Nvidia increased by 1.4% and 2.1%.
The iShares Semiconductor ETF saw a rise of 6.1%, a stark contrast to the 10% drop in chip ETFs the prior Friday.
As for cryptocurrency and tech investments, investors have been cautious in anticipation of major upcoming AI IPOs, starting with SpaceX’s IPO slated for Friday.
This IPO aims for a valuation of $1.75 trillion, which would potentially make Elon Musk the first billionaire. Currently, he is recognized by Forbes as the richest person in the world, with a net worth of $788.9 billion.
However, Oracle did not share in the gains among tech stocks, seeing a decline of 8.5%. While the software company reported strong profits, its announcement of an additional $20 billion spending plan, alongside negative free cash flow for the year, took investors by surprise.
