Chip stocks experienced a notable rebound, with the PHLX Semiconductor Sector Index climbing over 5%, recovering some recent losses. Intel was a prominent gainer, rising 8.6% ahead of its earnings report. This surge occurred despite investor concerns over lower-cost Chinese AI models potentially impacting demand for high-end chips used by companies like Anthropic and Open AI. Chip stocks, however, remain down approximately 3% over the last five trading days.

Meanwhile, oil prices edged higher, influenced by escalating Middle East tensions. Brent crude settled at $91.01 a barrel, up 2%, as hopes for a swift ceasefire waned amid ongoing U.S.-Iran conflicts. In the automotive sector, General Motors saw a 4.9% increase after reporting stronger-than-expected revenue and raising its full-year profit outlook, attributed to sales of more profitable, higher-priced vehicles.

Stock indexes also showed positive movement, with the S&P 500 up 0.9%, the Nasdaq gaining 1.3%, and the Dow Jones Industrial Average rising 0.7% to close at 52,225 points. These gains occurred as China's advancements in AI, with companies like Alibaba and Moonshot AI releasing new models, continue to spark debate on U.S. export policies.