US stocks bounced back sharply on Monday morning, with tech leading the charge after a painful Friday session rattled investor confidence. The Nasdaq Composite surged over 1.6%, the S&P 500 climbed nearly 1%, and the Dow Jones added 0.3%, signaling that buyers stepped in quickly to defend recent gains. Markets were digesting a complex mix of signals — from AI optimism and chip stock recovery to rising oil prices driven by fresh Iran-Israel tensions.
The rebound came just days after the S&P 500 snapped its nine-week winning streak, and investors were eager to reassess whether Friday's selloff was a buying opportunity or the start of something deeper.
The May jobs report, stronger than expected, had rattled rate-sensitive tech stocks by reinforcing the case for the Federal Reserve to keep interest rates elevated. But by Monday, market sentiment had already shifted. Nvidia CEO Jensen Huang publicly suggested the pullback was a chance to buy into artificial intelligence, and chip stocks responded immediately.
Micron surged 9%, Nvidia added over 1.5%, and the Philadelphia Semiconductor Index jumped more than 6% — one of its strongest single-session moves in recent memory. The AI trade, many analysts argued, was bruised but far from broken.
US Stock Market Rally Powers Higher as Dow Jones, S&P 500 and Nasdaq Surge on AI Boom, Intel Jump and Falling VIX
Intel jumped more than 11% after reports emerged that Google had placed an order for 3 million of its in-house Tensor Processing Unit chips, with Intel tapped as the manufacturer. This is a significant development in the global chip supply chain. Taiwan Semiconductor Manufacturing Company, the dominant chip foundry, has been struggling to meet surging AI-driven demand — and that strain is creating real openings for rivals.
Google is reportedly targeting production of over 6 million TPUs through 2027 and 2028, according to Morgan Stanley estimates, hinting at a multi-year revenue stream for Intel. Even Nvidia has been quietly testing Intel's manufacturing capabilities for its next GPU series, though no orders have been confirmed. For Intel, long seen as losing ground in the semiconductor race, Monday's news repositioned it as a credible player in the AI infrastructure buildout.
Top gainers and losers today
American Battery Technology (ABAT) led Wall Street's gainers with a surge of 24.92% to $3.88. Laser Photonics (LASE) jumped 23.55% to $3.83, while Marvell Technology (MRVL) rallied 13.60% to $299.30. Intel (INTC) soared 11.27% to $110.35 after reports linked the chipmaker to a potential large AI-related order from Google. Micron Technology (MU) also gained 9.13%, extending strength across the semiconductor sector.
Among notable decliners, Travelers, Sherwin-Williams, Salesforce, Microsoft and Visa were among the weakest Dow components. Travelers fell 1.28%, Sherwin-Williams dropped 1.29%, Salesforce slipped 1.30%, Microsoft lost 1.09%, and Visa declined 0.87% as investors rotated into high-growth technology and semiconductor stocks.
Is This an AI Bubble — or Just a Bull Market That Earned Its Gains?
The question hanging over every rally right now is whether markets have simply run too far, too fast. Prior to Friday's pullback, the S&P 500 had surged 15% in just two months — a 99th percentile return going back to 1980, according to Goldman Sachs analyst Ben Snider. That kind of move naturally raises bubble alarms. But Snider's research offered a more nuanced picture.
IPO volumes remain well below historical cycle peaks, a classic indicator of late-stage market euphoria. Retail speculation, while present, hasn't reached the fever pitch seen during the 2021 meme stock era. The AI trade is concentrated, yes, but it's also anchored in genuine capital expenditure from the world's largest technology companies. That distinction matters. Bubbles tend to be built on promises; this rally, at least partially, is built on contracts, data centers, and chips being manufactured right now.
Oil Prices and Inflation Data Add a Second Front of Risk This Week
Just as stocks were finding their footing, oil markets reminded investors that geopolitical risk hasn't gone away. Iran fired missiles at Israel for the first time since April, and Israel responded despite direct appeals from President Trump to stand down. Brent crude spiked nearly 4% to approach $98 a barrel before pulling back, while West Texas Intermediate neared $95.
For markets already watching inflation carefully, an oil price surge is the last thing the Federal Reserve wants to see. Wednesday's Consumer Price Index release will be closely watched to determine whether energy costs are starting to filter into broader prices. The Fed has been clear that it needs sustained progress on inflation before considering any rate relief, and a hot CPI print could undo Monday's optimism quickly.
Also on the radar this week: Oracle reports earnings Wednesday, and the anticipated SpaceX IPO on Friday could become the largest public offering ever recorded — a moment that would say something meaningful about investor appetite for high-growth, mission-driven companies even in a uncertain rate environment.
