Two major factors drive a "full-speed return" of risk appetite, with chip stocks hitting new highs.
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Driven by both expectations for an Iran peace deal and the AI geopolitical race, the chip sector broke out of its adjustment range in a single day and set a new historical closing record.
On Monday, global risk appetite made a strong comeback, with two major factors jointly pushing chip stocks to lead the US stock market gains.
The signing of a preliminary US-Iran peace deal boosted overall market sentiment, while the US export controls on Anthropic’s new models have sparked strong expectations that other countries will accelerate the building of their own AI infrastructure, potentially benefiting global chip demand expansion.
The Philadelphia Semiconductor Index surged 5.45% on Monday, breaking out of the technical correction range and setting a new closing high.
Nvidia, Broadcom, and Intel all rose more than 2.5%, Qualcomm was up over 4%, and Marvell Technology soared more than 10%.
The memory sector also exploded, with Micron Technology and Seagate Technology each up over 10% and 9% respectively. Western Digital soared more than 16%, leading the S&P component index.
(Top 10 S&P 500 constituent stock gains on Monday)
Return of risk appetite provides fundamental support for chip stocks
The first catalyst of this rally comes from a major turning point in the Middle East situation.
According to Xinhua News Agency, US President Trump said on social media on the 14th that following the signing of the US-Iran deal on Friday, June 19, the Strait of Hormuz will be reopened for mine-clearing operations. Iran’s Deputy Foreign Minister also stated that it would immediately and permanently stop military actions on several fronts, including Lebanon, starting tonight.
US officials confirmed that Iranian Parliamentary Speaker Ghalibaf signed the agreement on behalf of Iran. He is regarded as a hardliner in the supreme leader’s camp, lending significant political weight to the deal. Details of the memorandum are expected to be released within 24 to 48 hours.
Stimulated by this news, risk-aversion sentiment quickly faded, and funds flowed into high-beta risk assets. The US Nasdaq index strongly outperformed other major indices, with technology, media, and telecommunications (TMT) sectors leading gains, while energy and defensive sectors lagged.
Rainwater Equity ETF founder and fund manager Joseph Shaposhnik said:
It’s clear the market believes the Iran deal reduces risk, and Monday's rally was a rebound for a broader set of risk assets.
However, analysts cautioned that the peace process holds many uncertainties.
Wallstreetcn noted that according to US media reports on Monday, a senior US official said shipping volume through the Strait will gradually increase, but it could take up to two weeks for shipments to significantly increase, and even longer to return to pre-February levels, before the US and Israel took military action against Iran.
The official also noted that there are still mines to be cleared from the Strait, and different shipping companies have varying risk tolerance for passage. Reid from Deutsche Bank pointed out in a report:
The agreement is very good news for the market, but difficult negotiations in the next 60 days are still needed to ensure sustainable peace.
Reid also especially noted that the agreement still requires the US Senate to approve waivers of sanctions on Iran.
Anthropic export controls stoke expectations of a global AI arms race
Another driving force comes from the geopolitical game in the AI sector.
Wallstreetcn noted, Wallstreetcn noted, that two of Anthropic’s top AI models, Fable 5 and Mythos 5, have been placed under export controls by the US Department of Commerce, restricting access by overseas and domestic foreign nationals, citing jailbreak security risks.
This move quickly spurred market speculation that global AI sovereignty competition is heating up.
D.A. Davidson analyst Gil Luria said, if other countries decide to ramp up investment in AI infrastructure — "including building their own equipment and data centers, and funding domestic cutting-edge model development" — this will bring considerable international and government business growth to chip companies.
Box CEO Aaron Levie posted on Sunday, saying that this US government decision sets a precedent — AI models could indeed be forcibly pulled offline.
He believes that just two days ago this risk was an untested hypothesis, but it has now become reality, which is likely to prompt more countries to speed up independent development of their own AI.
He also warned that as more countries turn to developing open-weight models, which "currently generally do not come from the US," US AI leadership may gradually be eroded over time.
However, Mizuho analyst Jordan Klein takes a more cautious stance, arguing that the dispute between the US government and Anthropic is just "noise," and has "no real impact" on the overall narrative for the chip industry or AI spending.
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