AI Stock Recovery Drives Wall Street Higher as Nasdaq Leads Gains Amid Renewed Tech Optimism

By zoey

U.S. stock markets advanced on Monday, driven largely by a rebound in artificial intelligence-related companies that helped offset broader weakness across most listed shares.

The gains extended a volatile stretch for technology stocks that have recently swung between sharp losses and strong recoveries as investors reassess the sustainability of the AI-driven rally that has dominated markets over the past year.

The S&P 500 rose 0.7%, briefly moving back within 1% of its all-time high, even though a majority of its constituent stocks ended the session lower.

The Nasdaq composite, which is heavily weighted toward technology and growth companies, climbed 1.1%, supported by renewed buying interest in semiconductor and AI infrastructure firms. The Dow Jones Industrial Average added 155 points, or 0.3%, closing at a record high and extending its upward momentum.

Market analysts noted that while headline indexes moved higher, underlying breadth remained weak, indicating that gains were concentrated in a relatively small group of large-cap technology stocks tied to artificial intelligence development and data infrastructure.

The AI sector has experienced heightened volatility in recent weeks as investors weigh whether current valuations have run ahead of fundamentals.

Concerns have grown that massive capital inflows into AI chips, cloud computing infrastructure and data center expansion may not translate into proportional gains in productivity or corporate earnings over the long term.

Despite those concerns, several major technology names helped drive Monday’s rebound.

Broadcom emerged as one of the strongest contributors to the S&P 500’s advance, rising 3.7% after announcing long-term agreements to supply semiconductor products to Apple.

The gains marked a sharp reversal for the company, which had fallen in consecutive sessions late last week before U.S. markets closed for the Independence Day holiday.

The renewed momentum in AI-linked equities comes as global investor appetite for artificial intelligence infrastructure faces a significant test later this week with a major capital markets move from South Korea’s SK Hynix.

The semiconductor manufacturer is preparing to raise approximately $28 billion through a share offering that will include listings in the United States on the Nasdaq exchange, potentially making it one of the largest U.S.-linked offerings in history.

The deal follows extraordinary gains in SK Hynix’s stock price, which has more than tripled this year amid surging demand for high-bandwidth memory chips used in AI systems.

However, the company has also experienced sharp swings in recent weeks, including a 14.6% decline in a single session, underscoring the volatility that has accompanied the AI investment boom.

The broader AI ecosystem has also been marked by dramatic trading activity among newly public companies and infrastructure providers.

SpaceX, which has expanded into artificial intelligence through its ownership of xAI, has seen fluctuating trading performance following its high-profile public market debut. The stock reversed early gains to fall 1% in its final trading session before its scheduled inclusion in the Nasdaq 100 index.

That inclusion is expected to trigger automatic buying from index-tracking funds, including exchange-traded products such as the QQQ fund, which mirrors the performance of the index’s largest non-financial companies.

Elsewhere in the AI infrastructure space, TeraWulf advanced 4.9% after announcing a long-term agreement with AI company Anthropic. Under the deal, Anthropic will utilize TeraWulf’s data center capacity in Kentucky for a 20-year period.

The agreement is projected to generate approximately $19 billion in revenue and marks a continued shift for TeraWulf away from its origins in bitcoin mining toward high-performance computing services supporting artificial intelligence workloads.

Taken together, these developments highlight the accelerating convergence between traditional semiconductor manufacturing, cloud infrastructure, and emerging AI-focused data center operations, all of which have become central drivers of equity market performance.

By the close of trading, the S&P 500 had gained 54.19 points to finish at 7,537.54. The Dow Jones Industrial Average rose 155.84 points to 53,055.91, while the Nasdaq composite climbed 288.49 points to close at 26,121.16.

In energy markets, oil prices were relatively stable after OPEC+ announced plans on Sunday for a modest increase in production. Seven member countries of the alliance agreed to boost output by a combined 188,000 barrels per day beginning in August.

The move marked the fifth consecutive monthly production increase, a pattern that typically places downward pressure on global crude prices.

Brent crude, the international benchmark, slipped 0.2% to $71.99 per barrel. Prices remain near levels seen before geopolitical tensions earlier in the year briefly pushed oil markets higher following military actions involving the United States and Israel.

In bond markets, Treasury yields edged lower as investors adjusted expectations for interest rates. The yield on the 10-year U.S. Treasury note fell to 4.47% from 4.49% late last week, reflecting cautious sentiment among fixed-income traders.

Economic data released Monday showed that growth in U.S. services sectors—including recreation and financial services—remained broadly in line with economist expectations.

A survey from the Institute for Supply Management indicated that some businesses reported easing cost pressures, particularly from lower gasoline and diesel prices, suggesting modest relief from inflationary trends.

International equity markets were mixed, with modest declines across most major European and Asian indexes. Hong Kong’s Hang Seng Index stood out as a regional outperformer, rising 1.1% amid selective technology buying.

Overall, Monday’s trading session reflected a market still heavily dependent on the performance of a narrow group of AI-linked companies, even as broader economic indicators and sector performance remain more subdued.

Investors continue to navigate a landscape defined by rapid technological investment, shifting global supply chains, and uncertainty over how quickly artificial intelligence spending will translate into sustained corporate earnings growth.