U.S. stock indexes opened higher on Wednesday as oil prices fell toward prewar levels and technology stocks partially recovered from a sharp two-day decline, with investors focused on Micron $MU Technology's earnings due after the market close.
Among the major indexes, the Dow Jones Industrial Average climbed 90 points, or 0.2%, with the S&P 500 and Nasdaq $NDAQ Composite posting gains of 0.4% and 0.5%, respectively. International oil prices approached their prewar floor, with Brent crude futures dropping roughly 4% to near $73 a barrel — a level last seen before Washington and Tel Aviv initiated airstrikes on Iran in late February. The U.S. benchmark, West Texas Intermediate, shed about 4% to trade near $70 a barrel.
Traffic through the Strait of Hormuz rose to 31 ships on Tuesday, according to The Wall Street Journal, citing shipping-data firm Kpler.
After both Micron and SanDisk plunged 13% the day before, each clawed back ground on Wednesday — Micron adding roughly 2% and SanDisk close to 3%. The Roundhill Memory ETF (DRAM) also recovered, gaining about 3% after Tuesday's 14% drubbing. Third-quarter results from Micron are due after Wednesday's closing bell, with Wall Street consensus tracked by FactSet calling for earnings of $20.83 a share and revenue of $35.75 billion.
Tuesday's session had been punishing for chip-sector holdings, with the VanEck Semiconductor ETF (SMH) closing down 7% as investors broadly dumped semiconductor-adjacent names.
Dan Skelly, head of market research and strategy at Morgan Stanley $MS Wealth Management, said on CNBC that fundamental risks may be emerging alongside technical pressures in the sector. "We've heard about pricing wars among some of the model builders, we've heard about rental prices for old GPUs starting to decline, and we've also seen a shift in tone from Microsoft $MSFT, who led the AI launch three years ago with ChatGPT and their partnership with Open AI," he said, adding that Microsoft is "now talking about a change in strategic direction for lower-cost models."
S&P Global $SPGI's Tuesday announcement that Alphabet $GOOGL would take Verizon $VZ's spot in the Dow Jones Industrial Average gave the search giant a lift, with its shares up close to 1%.
Elsewhere in AI, Cerebras Systems stock fell after the company warned it expects to keep operating at a loss. South Korean chip maker SK Hynix is also testing investor appetite with plans for a $29 billion U.S. listing.