Nasdaq Composite Jumps: Memory and Semi Stocks Stage Powerful Comeback Rally

The Nasdaq Composite jumped 2.78% to close at 25,122.18 on Thursday as memory and semiconductor names reversed recent losses with double-digit gains, led by a spectacular 18% surge in Micron Technology that reignited optimism across the artificial intelligence infrastructure trade.

The technology-heavy index’s rally came as markets reassessed the durability of AI-driven demand for chips and memory following days of sharp selling pressure. The S&P 500 climbed 1.66%, the Dow Jones Industrial Average added 1.19%, and the Russell 2000 gained 1.37%, but it was the semiconductor sector that commanded attention with moves reminiscent of a violent short squeeze.

Today’s Leaders

Micron Technology led the charge, rocketing 18.36% from $739.00 to close at $874.66, extending its year-to-date gain to more than 100%. The rally represented a stark reversal for the memory giant, which had been sold down hard earlier in the month despite what many analysts characterised as stellar fundamentals driven by insatiable AI memory demand.

Western Digital surged 15.37% to $533.04, while Sandisk posted an even more dramatic 25.99% gain to $1,279.96. The storage and NAND flash suppliers have become derivative plays on the broader AI memory narrative, with their fortunes closely tied to datacenter build-outs and training infrastructure expansion.

Among the AI infrastructure names, Nebius exploded 27.13% higher to $188.43, while CoreWeave jumped 21.51% to $73.90. Both GPU cloud providers had been hammered earlier in July on fears that Meta Platforms might flood the market with excess AI compute capacity, but those concerns appear to have evaporated as hyperscalers reaffirmed aggressive spending trajectories.

Astera Labs, the high-speed connectivity specialist for AI servers, climbed 20.00% to $299.69, while semiconductor equipment maker Lam Research gained 17.98% to $297.72. Even Microsoft, which posted its best single session since 2008, added 15.51% to $451.10, providing crucial validation for the AI infrastructure thesis. Advanced Micro Devices rounded out the rally with a 13% gain.

Mood Shifts, But July Remains Red

The breadth and magnitude of today’s moves suggest markets are once again embracing the entire AI infrastructure stack after a period of doubt about valuations and capital expenditure sustainability. Memory stocks in particular have become a focal point.

On the bullish side, the memory sector continues to benefit from what analysts describe as a seller’s market, with AI-driven demand for HBM3 and high-end DRAM far outstripping supply. Micron’s massive US investment plans, backed by policy support, provide multi-year visibility that distinguishes this cycle from prior memory booms driven solely by consumer electronics or PC refresh cycles.

However, caution is warranted. Memory and semiconductor equipment are notoriously cyclical sectors, with history showing that periods of euphoric capex and pricing power typically give way to digestion phases characterised by margin compression and order cancellations. The fact that many of the winners are already up several hundred percent over one to two years raises questions about how much future upside is already priced in.

Bond market commentary continues to flag persistent inflation concerns and higher-for-longer interest rate expectations, which cap how far valuations for long-duration, AI-story stocks can rerate. The Nasdaq remains down 4.16% for the month despite today’s rally, a reminder that the path higher has been anything but smooth.