Stocks Rebound as Chips Lead, Oil Cools, and Yields Ease
Wall Street spent Wednesday selling the Fed hike. Thursday it bought the hangover.
The S&P 500 climbed about 1.1% to roughly 7,638. The Nasdaq jumped about 1.7% to about 26,418. The Dow added roughly 0.6%, near 318 points, reclaiming about half of Wednesday's drop. It was the best session in about six weeks after a stretch that had the major indexes red on seven of eight days into the decision.
Three linked moves did the work: oil cooled, the 10-year Treasury yield eased back under 5%, and chip stocks led the rally in duration-sensitive tech. Brent settled near $105 after sliding about 1%, and WTI spent time back under $100 as supply workarounds and China pressure on regional actors took some of the panic premium out of crude.
Chips carried the tape
A chip gauge rose about 3%. Intel jumped roughly 7% to 8% on talk of U.S. memory work with SK Hynix and the broader semiconductor bounce. AMD gained about 6%. Micron added about 5.5%. Nvidia rose about 2.5% after Jensen Huang's double-the-chips comments. Information technology led S&P sectors with about a 2.2% gain. Financials and staples were the soft spots and finished slightly lower.
Crypto-linked names caught a separate policy spark after the Securities and Exchange Commission rolled out a five-year innovation exemption that lets certain tokenized stock trading venues operate without full exchange registration. Circle and Robinhood each jumped more than 5% on the session while Coinbase also advanced. That is a policy story, not a pure earnings story, but it still put money into risk assets that had been punched around all week.
What the rebound does not erase
The Fed still raised the funds target to 3.75% to 4% on Wednesday. Chair Kevin Warsh still talked like inflation has run hot for too long. Futures still priced decent odds of another move later this year. A one-day green board after a hawkish hike is common market behavior, and it is not the same thing as investors deciding that a higher-for-longer policy path is suddenly irrelevant.
Jobless claims helped the calm. Initial claims fell to 196,000 for the week ended September 12, the lowest since July, even with Labor Day noise in the series. Housing starts and pending home sales also showed a little life. That mix let traders argue the broader economy can absorb the policy tightening without cracking in the immediate week ahead, which is a softer claim than saying inflation is already beaten.
Friday futures were softer overnight, which is the honest hangover after a relief session: the bounce fixed the panic without retiring the rate path, the oil war premium, or the need for earnings to clear a higher hurdle rate.
Bottom Line: Thursday was oil down, yields down, chips up. Useful. Not a full rewrite of the Fed week. The next inflation and jobs reports still get to grade the rebound.
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