We’re having a good day today, and the catalyst behind this rally was the IPO, which was the second-largest IPO ever (after SpaceX). It was oversubscribed, so the stock is expected to gap up on Friday when its ADR shares commence trading.
Also helping SK Hynix and all memory stocks is that Micron Technology () announced on Thursday that it is accelerating its planned U.S. fab and technology investments, plus increasing its expected spending forecast to more than $250 billion through 2035, which is driven by surging AI-related demand for memory. Micron Technology anticipates that its increase in U.S. investments will support its long-term goal of producing 40% of its DRAM in the U.S. while creating additional good-paying direct and indirect jobs. President Trump has previously praised Micron Technology for expanding its production in the U.S.
Today’s rebound demonstrates that good stocks bounce. We’re now about to go into the second quarter announcement season, and believe it or not, it’s going to be better than the first quarter. The stock market is expected to remain strong because of wave after wave of positive earnings announcements to look forward to in the upcoming weeks as well as the rest of this year. Due to rising household wealth for the 50% of Americans who invest in the stock market, some of this “wealth effect” is expected to filter down and help boost prosperity for all Americans as the velocity of money increases.
We’re in the bumpy summer months, but the underlying force underneath this market is earnings and a very strong economic recovery.