Nasdaq Extends Six-Week Rally as Memory Chip Makers Drive Historic Semi Surge

The Nasdaq Composite climbed 0.33% to 26332.755 today, capping a remarkable six-week winning streak that has delivered a 26.5% gain since late March, as artificial intelligence infrastructure stocks and memory chip makers posted triple-digit year-to-date returns that are reshaping the technology sector’s leadership profile.

Nvidia shares added 2.85% to $221.35, pushing its market capitalisation to $5.37 trillion ahead of next week’s closely watched earnings report. Despite the market leading cap, the GPU designer’s gains pale in comparison to the explosive moves in memory and storage names.

Intel shares have surged more than 200% since January, notching record highs, while Micron Technology jumped over 7%, bringing year-to-date gains to 155%. SanDisk has posted the most dramatic advance, soaring 469% this year, and Western Digital added 8% so far Monday to extend its 2025 return to 176%.

The PHLX Semiconductor Index just completed its strongest six-week run since the dot-com peak, with the global semiconductor sector adding approximately $3.8 trillion in market capitalisation over that span. The Global X Semiconductor ETF sits up 54.75% since the start of the year, as Semiconductors, and more particularly, Memory names continue to outperform.

Driving the Tech Rally

The rally reflects a fundamental shift in how markets are valuing chip makers, moving away from traditional cyclical frameworks toward viewing them as infrastructure providers for 24/7 artificial intelligence workloads. Aggregate S&P 500 earnings growth is tracking close to 28-29% year-over-year, with AI-heavy technology names accounting for a disproportionate share of that expansion.

Memory chip makers have benefited from structural demand changes as hyperscale cloud providers including Alphabet, Microsoft and Amazon commit to multi-year capital expenditure programmes centred on AI data centres. Micron is expected to swing from 2023 operating losses to tens of billions in operating profit, driven by insatiable appetite for high-bandwidth DRAM and advanced NAND flash storage. Western Digital’s recent investor presentations have highlighted efficiency gains versus legacy hard-disk-drive architectures, including fewer server racks, lower power consumption and smaller physical footprints for AI training and inference clusters.

Intel’s resurgence has broadened the AI chip narrative beyond Nvidia’s dominance, with strong quarterly results from both Intel and AMD reinforcing the view that demand for AI compute infrastructure extends across multiple architectures and vendors. Qualcomm has also reached 52-week highs, supported by analyst upgrades tied to edge-AI connectivity and on-device processing requirements.

The broader market backdrop has proven surprisingly accommodating despite geopolitical headwinds. US President Trump’s recent comments that the Iran-US ceasefire is on “life support” initially triggered a relief rally when the Strait of Hormuz reopened, sending European stocks to their best day in a year and causing crude oil prices to tumble. However, stalled negotiations have since pushed oil prices higher again, reintroducing inflation concerns that markets have largely chosen to ignore in favour of AI earnings momentum.

Outlook

Nvidia’s upcoming earnings report looms as a critical test. As the bellwether for AI infrastructure spending, any shortfall in GPU demand, supply constraints or pricing pressure would likely reverberate across the entire chip complex. Similarly, April CPI data and Federal Reserve communications will determine whether markets can maintain their “Goldilocks” narrative of strong growth alongside manageable inflation.

Technical indicators show the Nasdaq printing an unusually large number of 52-week highs within the semiconductor and memory sub-sectors, historically a sign of powerful momentum but also elevated vulnerability to reversals. Volatility has remained subdued despite rich valuations, with the market repeatedly “looking through” macro headwinds when technology earnings surprise to the upside.

The fragile Iran-US situation presents a tail risk that could quickly shift sentiment if negotiations collapse, with comments from US President Trump that the ceasefire is “on life support” doing little to derail the momentum in tech names. A sharp spike in crude oil prices however, or an escalation in conflict would force markets to reassess inflation trajectories and potentially price out anticipated interest rate cuts, creating headwinds for long-duration growth stocks trading at elevated multiples.