US Stocks Mixed: Micron Surges on AI Optimism as Apple Shares Slide

Wall Street experienced a volatile trading session as a massive rally in AI-linked semiconductor stocks provided a cushion for the Dow Jones, even as tech giant Apple faced headwinds. While the chip sector showed immense strength, broader market indices like the Nasdaq and S&P 500 struggled under the weight of declining large-cap technology stocks.

Micron and Qualcomm Lead the AI Rally

The primary driver of market optimism was Micron Technology, which saw its shares surge by 9.7%. The memory-chip maker reported quarterly profit and revenue figures that comfortably exceeded Wall Street estimates. More importantly, Micron issued a stronger-than-expected revenue forecast for the current quarter, helping to soothe investor fears that AI-related semiconductor stocks had become overvalued following their aggressive rallies earlier this year.

Qualcomm also joined the semiconductor winning streak, climbing 3.1%. The company raised its long-term growth forecast, predicting that the rapid expansion of artificial intelligence will drive revenue from non-smartphone sectors—such as data centers—to reach USD 40 billion by fiscal 2029. This momentum was mirrored in Asian markets, where South Korea's SK Hynix jumped 13.1%, contributing to a 5.4% surge in the Kospi.

Apple Faces Pressure from Price Hikes and Rising Costs

In contrast to the semiconductor boom, Apple shares plummeted by 4.8%. The decline follows reports that the company is increasing prices across several product lines to offset rising expenses. Analysts noted that Mac computers, in particular, could see price hikes ranging from 15% to 20%.

This price adjustment is largely driven by the rising costs of memory and storage, which are currently benefiting semiconductor manufacturers but squeezing the margins of device makers like Apple. The dual pressure of increased production costs and the potential for reduced consumer demand due to higher retail prices has made the tech giant a laggard in the current session.

Inflation Data and Treasury Yields Provide Market Support

Broader market sentiment was also influenced by macroeconomic indicators. US consumer inflation, measured by the Personal Consumption Expenditures (PCE) index, accelerated to 4.1% in May from 3.8% in April. While this represents an increase, the figure largely matched economist expectations, preventing a panic sell-off.

This stability contributed to a decline in Treasury yields. The benchmark 10-year US Treasury yield eased to 4.36% from 4.41% on Wednesday, providing much-needed relief to equities. Additionally, energy markets showed signs of stabilization; Brent crude slipped 0.1% to USD 73.81 a barrel, retreating from the highs seen during recent geopolitical tensions in the Middle East, which helped ease fears of persistent energy-driven inflation.

Key Takeaways

  • AI Dominance: Micron's strong earnings and Qualcomm's aggressive growth forecasts for AI-driven revenue are fueling a massive rally in the semiconductor sector.
  • Apple's Margin Struggle: Rising component costs are forcing Apple to implement significant price hikes (up to 20% on Macs), leading to a nearly 5% drop in share price.
  • Macro Stability: Inflationary data meeting expectations and cooling Treasury yields have provided a stabilizing backdrop for the Dow Jones amidst sector-specific volatility.