Nasdaq, S&P 500 Rise as AI-Fuelled Chip Rally Sweeps Global Markets

By Lidia Yadlos

A powerful rally in semiconductor stocks lifted global markets on Friday.

The Nasdaq gained 1.3%, the S&P 500 rose 0.7% and the Dow Jones Industrial Average added 0.3%, while South Korea's KOSPI surged 17.9%, its biggest single-day gain on record, as investors piled back into AI-linked chip stocks.

The recovery wasn't driven by a new breakthrough in AI. It came after Microsoft and Amazon reported stronger-than-expected earnings and reaffirmed that spending on AI infrastructure remains a priority.

Those results helped restore confidence that the billions flowing into chips, data centres and cloud computing are translating into real business growth rather than speculative spending.

From Panic to Relief in Four Days

Only days earlier, the picture looked very different. South Korea's stock market had become the centre of a global technology selloff. The KOSPI lost more than 17% in three trading sessions as investors dumped AI-linked names including Samsung Electronics and SK Hynix amid concerns that expectations had simply run too far ahead of reality.

Friday reversed much of that damage. The KOSPI surged almost 18%, while SK Hynix jumped roughly 30% and Samsung Electronics climbed about 27%. In the United States, semiconductor names including AMD and Micron also rallied as investors rotated back into AI infrastructure stocks.

AI Spending Remains the Market's Favorite Metric

This earnings season has reinforced a clear pattern. Markets are paying less attention to quarterly revenue and more attention to one question: Are companies still spending aggressively on AI?

Microsoft's cloud business and Amazon Web Services both delivered results that suggested AI investments are beginning to generate meaningful returns. Those updates eased fears that hyperscalers might slow capital expenditure after two years of record spending.

That confidence quickly flowed through the semiconductor supply chain. Memory manufacturers such as Samsung and SK Hynix sit near the front of that chain, while companies including AMD, Micron and Nvidia benefit as demand for AI servers, networking equipment and accelerators continues to grow.

One Theme Is Carrying Global Markets

The rebound also highlights how concentrated equity markets have become around a single investment narrative.

When South Korean memory chip makers can swing the Nasdaq, and Microsoft earnings can lift markets from Seoul to New York overnight, investors are no longer trading regional stories. They are trading one global AI supply chain.

That concentration cuts both ways. The same expectations that fuelled Friday's rally were responsible for one of the fastest technology selloffs of the year only days earlier.

Analysts say the correction reflected positioning and excessive leverage as much as any deterioration in AI demand, though concerns remain about Chinese competition and whether current spending levels can continue indefinitely.

For now, investors appear willing to keep betting that the AI infrastructure boom has further to run.

Published on Blockster

Nasdaq, S&P 500 Rise as AI-Fuelled Chip Rally Sweeps Global Markets