Wall Street looked ready to give the AI trade another chance on Thursday, but the recovery came with a warning label.
Nasdaq futures jumped after Micron and Qualcomm delivered the kind of demand signals investors had been waiting for after a bruising selloff in chip shares.
The message was simple: spending on AI infrastructure is still running hot.
Yet the rally is not happening in a vacuum.
Traders are also bracing for fresh US inflation data, higher borrowing costs and renewed scrutiny of how much debt Big Tech is using to fund the next stage of the AI buildout.
5 things to know before Wall Street opens
1. Nasdaq futures lead the rebound
S&P 500 futures rose 0.8% and Nasdaq 100 futures jumped 2.2%, while Dow futures added 140 points, or 0.3%, as tech stocks led the premarket rebound.
The move followed two sessions of losses and a sharp reset in AI-linked valuations.
Investors had been cutting exposure to crowded chip and hyperscaler trades amid concerns that the rally had run too far, too fast.
2. Micron gives the AI trade a fresh anchor
Micron became the clearest catalyst for the rebound.
The memory-chip maker said customers had committed $22 billion to secure supply, backed by strategic agreements across data-centre, consumer and automotive markets.
That helped ease fears that the AI infrastructure cycle was losing momentum.
Micron’s results also showed how memory has become a key bottleneck in the AI supply chain, not just a supporting part of the semiconductor story.
The stock jumped in premarket trading, and the read-across lifted other memory names, including SanDisk, Western Digital and Seagate.
3. Qualcomm broadens the AI story
Qualcomm added to the positive tone by setting a target of $15 billion in data-centre revenue by fiscal 2029.
That forecast matters because it suggests AI infrastructure demand is spreading beyond Nvidia-linked graphics processors and into a wider set of chips used for inference, custom silicon and server workloads.
For investors, that broadening is important. It gives the AI trade more earnings support, even as valuations remain stretched.
4. Valuation doubts have not gone away
The rally does not erase the market’s bigger concern: whether AI spending can justify current share prices.
Micron and Qualcomm have both delivered strong signals, but the sector is still facing questions over capital expenditure, debt-funded hyperscaler investment and future returns.
Market strategists broadly see the forecasts as supportive for sentiment, but not a full reset.
The Philadelphia Semiconductor Index remains on track for a record quarter, yet it has also endured one of its roughest weekly stretches since the Middle East conflict began.
5. PCE data could decide the day’s tone
The next test comes from the US personal consumption expenditures price index, the Federal Reserve’s preferred inflation gauge.
Economists expect annual inflation to reach 4.1%, more than twice the Fed’s target.
A softer reading could extend the tech rebound by easing pressure on yields.
A hotter print would bring borrowing costs back into focus, just as investors are debating how sustainable the AI spending boom really is.
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