Today’s Market Recap: US-Iran Talks Fail, Memory Chips Outperform as SanDisk Jumps 9%, Micron Tops $1,000

Tracking the Market Trend

TradingKey - The window for U.S.-Iran negotiations has closed, and the prospects for an agreement look bleak. The three major U.S. stock indices closed lower for the second consecutive day.

At the close, the Dow Jones Industrial Average fell 0.51% to 53,459.78; the Nasdaq Composite Index dropped 0.32% to 26,644.91; and the S&P 500 Index declined 0.52% to 7,745.06.

The “Big Seven Tech Companies” all weakened, with Meta (META) leading the decline with a sharp drop of 3.5%. However, the chip sector bucked the trend, with the Philadelphia Semiconductor Index rebounding 1.6% and returning to technical bull market territory. Among the two major memory chip giants, SanDisk(SNDK) surged nearly 9%, Western Digital (WDC) rose over 5%, and Micron(MU)gained nearly 4%, with its share price breaking above 1,000 yuan; optical communications stocks also surged, with Coherent (COHR) up nearly 8% and Lumentum (LITE) up 4.6%. SpaceX (SPCX) rebounded by more than 4%.

The bond and foreign exchange markets saw widespread volatility: escalating tensions in the Middle East pushed the yield on 30-year U.S. Treasuries to its highest level since 2007; the U.S. Dollar Index fell for the third consecutive session, hitting an intraday low not seen in over two months; the offshore yuan surged past 6.74, hitting a new high in more than three years; and Bitcoin(BTC) broke through $64,000 during the session, rebounding 3% from its intraday low.

Expectations of a breakdown in U.S.-Iran negotiations helped oil prices surge 3% during the session; U.S. crude closed at a monthly high, while Brent crude rose above $90 for the first time in three weeks; gold(XAUUSD) closed at a more than two-month high, with intraday gains exceeding 1%.

Market Headline

The U.S. corporate bond market is facing a flood of supply. The yield on 30-year U.S. Treasuries rose above 5.31% during Monday’s trading session, hitting its highest level since 2007. Investment-grade bond issuance in August has already reached $145.2 billion, surpassing the monthly record of $136 billion set in August 2020. Companies are borrowing heavily to fuel the AI boom, while the U.S. government’s nearly $2 trillion budget deficit is driving up Treasury supply, further exacerbating the supply-demand imbalance in the long-duration bond market.

Memory chips led the semiconductor sector in a lightning-fast return to a bull market. The bear market for the Philadelphia Semiconductor Index lasted only 21 days—the shortest since March 2020. Micron has risen 17.5% over the past five days, while SanDisk gained nearly 9% on Monday. Analysts note that the impressive financial results recently disclosed by Anthropic and OpenAI are the most significant catalysts for chip stocks at present; visibility into AI chip demand has significantly improved, and market concerns regarding AI capital expenditures are fading.

NVIDIA’s(NVDA) data center guarantee plan has been significantly scaled back. NVIDIA announced a strategic partnership with SB Energy to provide a credit guarantee for the PORTS-Pike Technology Park in Ohio, with a maximum limit of $105 billion—more than half the $250 billion initially reported. At the same time, NVIDIA will invest $1.5 billion in SB Energy and acquire an equity stake in the company, with OpenAI serving as the data center’s sole tenant.

Anthropic’s valuation is based on an aggressive bet that its revenue will soar to $200 billion by 2028. According to internal projections, Anthropic’s revenue in 2028 will reach between $190 billion and $200 billion, far exceeding the annualized revenue level of approximately $47 billion recorded in May of this year. Wall Street, drawing on the valuations of high-growth companies such as Palantir and SpaceX, is betting that Anthropic will achieve economies of scale and translate them into profits in the future; however, whether this logic behind the high valuation can be sustained remains to be tested by the market.

Anthropic’s annualized revenue is expected to exceed $65 billion before its IPO. According to sources familiar with the matter, as of the end of July, Anthropic’s revenue run rate had reached $65 billion, more than seven times the growth rate recorded at the end of last year. The company disclosed these figures during a routine update to investors. The sharp acceleration in revenue has solidified its IPO plans—both Anthropic and OpenAI have secretly filed for IPOs, and Anthropic is expected to go public as early as this fall, ahead of OpenAI.

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