US equities moved in different directions on Thursday as geopolitical tension linked to Iran and a sharp reset in AI expectations pulled sentiment apart, with industrial names powering ahead while technology shares swung through a volatile session shaped by chips.
The Dow Jones Industrial Average climbed more than 1.7%, adding over 850 points, while the S&P 500 advanced 0.5% and the Nasdaq Composite recovered from an early 0.7% drop to close up 0.2% as dip buying into selected tech leaders helped steady the index later in the day.
The most forceful move came from Broadcom, where shares sank more than 15% after its AI chip revenue outlook disappointed investors, wiping around $320 billion from its market value and placing it among the largest single stock declines seen in the megacap technology space.
Although Broadcom delivered an earnings beat, the market reaction centred on guidance, with the company opting to reiterate rather than upgrade its 2026 outlook, a stance that fell short of expectations after a prolonged rally across AI-linked names had pushed valuations higher.
The impact rippled through the semiconductor sector, with Intel, AMD and Arm Holdings all trimming earlier losses as the session progressed, while memory and storage groups such as Micron and SanDisk recovered part of their declines, moving more than 5% and 3% higher respectively after initial pressure.
Marvell Technology also reversed course, moving from early losses into gains of as much as 5%, as investors reassessed the severity of the Broadcom-led sell-off, while Nvidia supported the broader Nasdaq recovery, rising 2.7% after bouncing from morning lows and regaining momentum into the afternoon session.
Alphabet added further support to tech sentiment with a 3.8% advance, helping offset weakness elsewhere and reinforcing the selective nature of buying across the sector rather than a broad re-rating of growth stocks.
Geopolitical uncertainty still lingers, as the House of Representatives voted to end the war with Iran in a rebuke to President Trump following the most serious escalation since an April ceasefire, with oil prices rising earlier in the week as hopes for a swift diplomatic resolution faded and equities briefly retreated from record levels.
Elsewhere, attention also turned to capital markets after SpaceX confirmed plans to target a record breaking $75 billion IPO on 12 June, a move that could see broader index exposure through relaxed inclusion rules and potentially bring passive retirement portfolios into contact with the company.
Labour market data added further context ahead of Friday’s US jobs report, with weekly jobless claims rising to 225,000 for the week ending 30 May while layoff figures from Challenger, Gray and Christmas also showed an increase in announced job cuts, pointing to a gradual cooling in parts of the employment backdrop as markets absorbed multiple macro signals at once.
