Micron rises 3.03%; Philadelphia Semiconductor Index gains 1.59%
Energy sector leads gains; all eyes turn to September employment report
Wall Street kicked off the fourth quarter with modest gains on Tuesday, as equities bounced back from session lows following a retreat in benchmark Treasury yields. While semiconductor and energy shares showed strong momentum, losses in select mega-cap technology names, including Apple and Alphabet, kept major indexes in check.
The Dow Jones Industrial Average rose 20.51 points, or 0.04%, to close at 50,926.56. The S&P 500 gained 14.91 points, or 0.19%, to 7,666.45, while the tech-heavy Nasdaq Composite added 10.53 points, or 0.04%, to finish at 26,871.60. The S&P 500 snapped a three-session losing streak.
The primary catalyst for the market's turnaround was the bond market. The yield on the benchmark 10-year U.S. Treasury note touched a high of around 5.34%—its highest level since 2002—before easing back to the 5.23% range by the closing bell, breaking a seven-session winning streak. The 2-year yield also fell approximately 0.08 percentage points to around 4.79%. Easing pressure on yields came as the U.S. Treasury’s $6 billion buyback of long-term debt and a strong influx of safe-haven demand supported bond prices.
Remarks from Federal Reserve Vice Chair Philip Jefferson also helped soothe market anxieties regarding further monetary tightening. While reaffirming his support for the September rate hike during a speech, Jefferson noted that future policy adjustments would depend on incoming economic data, evolving outlooks, and risk assessments, signaling that policymakers are willing to proceed with caution. His comments struck a balance, acknowledging ongoing inflation risks while indicating the central bank is in no rush to take its next step.
Amid easing yield pressures, semiconductor shares outperformed the broader market. The Philadelphia Semiconductor Index climbed 200.38 points, or 1.59%, to finish at 12,829.00. Micron Technology led the advance with a 3.03% gain, while Nvidia and AMD added 1.09% and 0.65%, respectively.
Micron reported record fiscal fourth-quarter revenue, fueled by surging artificial intelligence (AI) demand, during earnings results released the previous day. The memory chip maker's upbeat revenue guidance for the upcoming quarter reinforced confidence in robust memory demand. The stock recovered from intraday losses to close in positive territory.
Semiconductor equipment makers advanced in tandem. Lam Research rose 3.53%, Applied Materials gained 3.50%, and KLA advanced 2.77%. Conversely, Broadcom fell 2.15% and Intel edged down 0.19%, highlighting divergence within the sector.
IT services provider Accenture surged 15.78% following its earnings release, with fiscal fourth-quarter revenue exceeding the upper bound of its prior guidance range. Among software equities, Salesforce climbed 3.10% and ServiceNow rose 2.80%.
However, this bullish sentiment failed to translate into a broad-based rally across mega-cap tech stocks. Apple retreated 0.81%, Alphabet Class A lost 1.70%, and Amazon dropped 0.37%. Tesla and Microsoft slipped 0.20% and 0.02%, respectively, while Meta Platforms managed a marginal gain of just 0.10%.
Outside the technology sector, energy stocks stood out. Brent crude prices jumped more than $4 a barrel amid supply concerns triggered by China's suspension of fuel exports. The S&P 500 energy sector advanced 1.9%, leading all 11 major industry groups.
Market attention now shifts to the U.S. September employment report, scheduled for release on Wednesday. Economists surveyed by The Wall Street Journal project that nonfarm payroll growth slowed to 84,000, down from 162,000 in the previous month. The forthcoming jobs and wage data will serve as a crucial gauge for assessing whether the Fed needs to pursue further rate hikes.
