TradingKey Daily Market Briefing: Oil Prices Surge, Chip Stocks Rally, Micron, SanDisk, Western Digital Jump

Tracking Market Trends

TradingKey - On July 21, Eastern Time, the three major U.S. stock indexes closed higher collectively, led by Nasdaq. Although the Middle East situation continued to push up oil prices and U.S. Treasury yields, investors bought back into AI and semiconductor stocks that had previously undergone a sharp correction, driving a clear recovery in market risk appetite. This week, earnings from tech companies such as Alphabet ( GOOGL ), Tesla ( TSLA ), IBM ( IBM ), Intel ( INTC) are about to be released, and the market is betting ahead of time that AI capital expenditure and corporate earnings remain resilient.

As of the close, the Dow Jones Industrial Average rose 0.74% to 52,230.23 points; the S&P 500 Index gained 0.89% to 7,509.20 points; the Nasdaq Composite Index rose 1.29% to 25,837.21 points.

In terms of sectors, semiconductors became the core of the U.S. stock rebound that day. The Philadelphia Semiconductor Index surged 5.21%, rebounding for the second consecutive trading day. In terms of individual stocks, Micron Technology ( MU) rose 12.17%, AMD ( AMD) gained 8.11%, Intel rose 8.64%, SanDisk ( SNDK) soared 14.27%, Western Digital ( WDC) surged 12.51%. The collective rebound of chip stocks indicates that the sell-off previously triggered by concerns over high AI valuations and capital expenditure returns has eased, with capital flowing back to cover the memory, GPU, and AI hardware chains.

In commodities, crude oil continued to move significantly higher. Brent crude ( UKOIL) rose 3.19% to $91.63; WTI crude ( USOIL) gained 2.6% to $84.55, with both hitting approximately five-week highs. The rise in oil prices was mainly driven by a new round of clashes between the U.S. and Iran and threats by Houthi militants to blockade Saudi maritime passages. Two tankers carrying Saudi crude to Asia turned around in the Red Sea, further amplifying market concerns over disruptions to Middle East energy transit.

Gold ( XAUUSD) rebounded and moved higher, with spot gold rising 1.75% to $4077.88. This indicates that the market is assessing diplomatic signals regarding a proposed 10-day ceasefire.

In the crypto market, Bitcoin ( BTC) rose 1.99% intraday, hitting a session high of $66,956. The rebound in tech and AI chip stocks improved risk appetite, driving a continued recovery in Bitcoin.

Market News

Exchange of fire between the US and Iran and Houthi threats continue to escalate energy risks. Reuters reported that two tankers carrying Saudi crude oil to Asia turned around in the Red Sea as Yemen's Houthi militants threatened to block Saudi sea lanes. Meanwhile, the US and Iran continued to launch strikes against each other, drawing attention to two major energy transit corridors: the Strait of Hormuz and the Bab-el-Mandeb Strait.

Big Tech earnings serve as a key test for US stocks this week. Alphabet, Tesla, and IBM will lead off earnings, followed by chipmakers including Intel. Given the recent sharp volatility in AI hardware stocks, this round of earnings is crucial not only for individual stock performances but will also shape market sentiment regarding AI monetization, cloud business demand, autonomous driving progress, and semiconductor order cycles. If Big Tech companies continue to raise their AI capital expenditure expectations, chip stocks could receive further support; however, if revenue guidance disappoints, the recent rally could turn back into profit-taking.

AMD is set to host its Advancing AI conference. AMD will hold its Advancing AI 2026 conference in San Francisco from July 22 to 23, where the market expects the company to further showcase progress on AI accelerators, data center CPUs, Helios rack-scale AI infrastructure, and its software ecosystem. Given Microsoft's recent expansion of its use of AMD's AI infrastructure, investors will focus on whether AMD can leverage this event to strengthen its competitive position in the AI computing market and further narrow the gap with Nvidia in the data center AI chip space.

USD/JPY breaks above 163 as pressure on yen depreciation intensifies. In foreign exchange markets, USD/JPY cleared the 163 mark, briefly touching 163.14 to hit its highest level since December 1986. Driven by rising oil prices, escalating geopolitical risks, and climbing US Treasury yields, capital continued to flow into US dollar assets, while the yen remained under pressure due to the Bank of Japan's slow pace of policy normalization. Following USD/JPY's breach of this key psychological level, market expectations for intervention by Japanese authorities have heated up notably, further increasing the risk of volatility across Asian currency markets.

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