Micron and SanDisk lead a surge, with the storage sector driving a rebound in U.S. stocks.

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Technology momentum stocks make a strong comeback, with memory and data storage sectors leading the market gains on Wednesday.

On Wednesday, April 1, US stocks rose for the second consecutive trading day, with technology stocks driving the Nasdaq up more than 1%. Storage stocks surged 8% in a single day, posting the index’s second-largest daily gain in history.

In terms of individual stocks, Micron Technology surged nearly 9%, SanDisk rose more than 9%; the data storage duo Western Digital and Seagate Technology climbed 10% and 8%, respectively.

This rally reflects a clear shift in investor sentiment. As the second quarter kicked off, market funds flowed back into technology momentum stocks from the previously favored defensive energy sector.

Momentum stocks return strongly, reversing March's slump

In March, due to the tense situation of the Iran war, investors sold off technology stocks massively and shifted to defensive sectors such as energy, hitting memory and storage stocks hardest.

Analysts believe that this week's inflow of funds indicates that, with the start of the second quarter, market risk appetite has clearly recovered.

On Wednesday, the Invesco S&P 500 Pure Growth ETF rose 3.2%. SanDisk and Micron Technology are both among the fund’s top 10 holdings. In addition, the Goldman Sachs Momentum Stock Index also surged for two consecutive days.

(Goldman Sachs Momentum Stock Index surges for two consecutive days)

Micron Technology, SanDisk, Western Digital, and Seagate Technology are typical representatives of the momentum investment style.

Last year, all four made it to the list of top S&P 500 performers, each posting triple-digit gains, primarily driven by the surge in demand for memory chips and data storage caused by the AI boom.

This fundamental backdrop provides essential support for the latest rebound. With continued expectations of increased capital expenditures related to artificial intelligence, the long-term demand logic for the memory and storage sector remains intact, enabling these stocks to benefit first as market sentiment improves.

The real engine supporting storage fundamentals: server demand

Previously, concerns about a sharp reduction in memory usage due to Google's latest TurboQuant compression algorithm, coupled with a wave of collective selling from earlier inventory hoarding, led to a plunge of nearly 30% in DDR5 memory module prices in US and Chinese retail channels.

Wallstreetcn previously noted that although there have been panic voices of a “price collapse” at the retail end, Wall Street and industry research institutions generally emphasize that the spot market is mainly composed of PCs and consumer electronics, and at most accounts for a low single-digit percentage of the total market's trading volume.

Setting aside the noise of the spot market, server-side demand signals are clear and strong.

Recent reports from Goldman Sachs and Korean brokerage Daishin Securities both indicate that the enterprise contract market has not been affected by this round. Major cloud service providers still have urgent demand for server memory, and the supply-demand fundamentals have not reversed substantially.

According to a Goldman Sachs report, in February, Taiwan server ODMs (including Inventec, Quanta, Wiwynn, Wistron) saw a year-on-year revenue growth of 84% and a month-on-month increase of 7%, maintaining over 80% year-on-year growth for four consecutive months, mainly benefiting from the rapid ramp-up in rack-scale AI server shipments and strong growth in ASIC AI servers.

Aspeed, the world’s largest BMC chip supplier for servers, saw its February revenue increase by 66% year-on-year and remained robust even against a high base in February 2025; storage distributor Supreme Electronics’ February revenue soared 137% year-on-year, clearly demonstrating strong demand at the channel level.

Channel surveys by Daishin Securities also provide more convincing details: a major cloud service provider has decided to purchase server DDR4 at a price higher than HBM3e. Ryu Hyung-geun wrote:

If genuine demand had started to weaken, there would be no explanation for why buyers are willing to pay a premium for traditional products.

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