Market Wrap US-Europe 9 July: Wall Street and Europe Rebound as a Semiconductor Rally Lifts the Nasdaq and Volatility Recedes

US and European equities rose on Thursday, recovering from the previous session’s risk-off tone, as a powerful rally in semiconductor shares lifted the Nasdaq, oil retreated on signs that Washington and Tehran could return to negotiations, and volatility fell sharply. London was the outlier, closing slightly lower.

In the United States, the technology-heavy Nasdaq Composite led the majors, rising 1.30 percent to 26,206.89 as investors rotated into semiconductors, with the PHLX Semiconductor Index climbing about 3.1 percent and Micron Technology gaining about 4.5 percent after announcing an investment of up to 3 billion dollars in the US chip supply chain, CNBC reported. The S&P 500 rose 0.81 percent to 7,543.64 and the Dow Jones Industrial Average added 0.27 percent to 52,487.41. The Nasdaq outperformed the Dow by 1.03 percentage points, our calculation, and the Dow remained lower for the week, on track to snap a four-week winning streak, its longest since late 2024, CNBC reported.

Europe closed higher across most of the continent. The Euro Stoxx 50 led the major benchmarks, rising 1.28 percent to 6,284.27, while France’s CAC 40 gained 0.90 percent to 8,326.62, a close confirmed at index operator Euronext, and Germany’s DAX added 0.89 percent to 25,118.27, with technology shares and miners leading the recovery. The UK’s FTSE 100 slipped 0.16 percent to 10,472.45, weighed in part by a slide of nearly 9 percent in AstraZeneca after a late-stage trial of its Wainua heart drug missed its target, CNBC reported. The four European benchmarks rose by a simple average of about 0.73 percent, our calculation, close to the roughly 0.79 percent average gain across the three US indices.

The backdrop was a broad recovery in risk appetite. Crude retreated, with Brent settling down 2.44 percent at 76.12 dollars a barrel as reports of mediation between Washington and Tehran took part of the security premium out of the price, while the VIX volatility gauge dropped 6.21 percent to 15.85 and the US 10-year Treasury yield eased about 2 basis points to 4.545 percent, our calculation. Bitcoin rose 1.68 percent to about 63,192 dollars. US data added to the steadier tone, with weekly jobless claims falling to 215,000, the lowest since late May, though existing home sales unexpectedly declined 2.4 percent in June, CNBC reported.

Why it matters: For MENA the session cuts both ways. Softer crude trims the immediate revenue tailwind for Gulf producers, but the reason for the move, signs that negotiations could resume, points to lower security risks around the Strait of Hormuz, the region’s most important export route, and that matters more for shipping, insurance and freight costs. Easier Treasury yields and receding volatility also loosen the external financial conditions that reach the Gulf through the currency pegs, while the recovery in Europe, a key trading partner, and the strength in global technology demand are supportive signals for the region’s diversification and export plans.

Outlook: The diplomatic track between Washington and Tehran and tanker traffic through the Strait of Hormuz remain the immediate variables. The June US inflation report is due on 14 July and will shape expectations for the Federal Reserve, while the second-quarter earnings season builds and SK Hynix makes its US market debut on Friday in a closely watched test of demand for semiconductor listings, CNBC reported.

US and Europe equities, ranked highest to lowest

MENA and Asia equities, ranked highest to lowest (9 July close, reference)

Rates, FX and crypto

Sources: Euronext; CNBC.

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