Chip Stocks Pull Stock Market Higher and Oil Slips 2% on Trump’s Deal Announcement

Quick overview

The Nasdaq climbed Tuesday morning in premarket trading, with chip stocks leading the way and oil prices falling after President Donald Trump announced a deal with Iran could happen in a few days.

Micron Technology (MU) gained 5% on Tuesday before the market opened fully, and the Nasdaq Composite climbed 0.8%. The Dow ticked up 0.2%, and the S&P 500 gained 0.4% thanks in large part to high performing chip stocks.

At the same time, oil prices are dropping, creating room for investors to make a move in the tech sector. West Texas Intermediate oil dipped 2% Tuesday morning following an announcement from President Trump that a deal with Iran could happen in two or three days. Brent crude dropped 1.73% and hit $92.72 per barrel.

Comeback for Tech Stocks Could Mean the Rally Resumes

Even though the technology stocks rally lost steam last week, and these futures closed much lower on Friday, the rally appeared to start back up Monday. Shares of Micron Technology, Nvidia (NVDA), Advanced Micro Devices, (AMD) and other leading chip and tech stocks all climbed much higher early this week, and they continued their ascent Tuesday morning.

Now, with two days of strong opening numbers, the tech sector is getting back on its feet and making up much of the lost ground from the weekend. Micron Technology futures fell around 20% last week but have already made back 10% for this week so far.

Stocks are emboldened by news that a deal may be reached in the Middle East very soon, and falling oil prices have spurred a quick reaction from the stock market. The recent jobs report showed very positive gains for the market as well, pointing toward an improving economy and strengthening business sectors.

Qualcomm (QCOM) climbed alongside Micron with gains of 3% Tuesday morning, and Nvidia continued its strong performance this week with an added 1.73%. It appears that a new chip stock rally may be happening, but news out of Iran could hurt the upward trajectory. Concerns that the AI sector is climbing too quickly are at least partially muted Tuesday, and market indicators point toward a strong day for the tech sector and potentially a full recovery for those tech stocks that fell so far late last week.

ABOUT THE AUTHOR See More

Timothy St. John

Financial Writer - European & US Desks

Timothy St John is a seasoned financial analyst and writer, catering to the dynamic landscapes of the US and European markets. Boasting over a decade of extensive freelance writing experience, he has made significant contributions to reputable platforms such as Yahoo!Finance, business.com: Expert Business Advice, Tips, and Resources - Business.com, and numerous others. Timothy's expertise lies in in-depth research and comprehensive coverage of stock and cryptocurrency movements, coupled with a keen understanding of the economic factors influencing currency dynamics. Timothy majored in English at East Tennessee State University, and you can find him on LinkedIn.

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