Chip Stocks Surge Past Geopolitical Fears: Markets Rally on Thursday, July 9, 2026

Wall Street demonstrated remarkable resilience on Thursday as investors chose to focus on semiconductor strength rather than escalating tensions in the Middle East. The S&P 500 climbed 0.85% to close at $751.71, with technology shares leading the charge despite Iran claiming strikes on U.S. military targets in the Gulf region.

Markets Brush Off Geopolitical Turmoil

In a trading session that could have easily turned risk-off, the Nasdaq posted sharp gains as chip stocks surged, demonstrating that investor appetite for artificial intelligence and semiconductor plays continues to trump global uncertainty. The rally came even as Iran announced it had struck U.S. military positions in the Gulf and began burial proceedings for slain Supreme Leader Khamenei.

The divergence between geopolitical headlines and market performance underscores a familiar pattern: traders have grown increasingly adept at compartmentalizing regional conflicts from their equity positioning, at least in the short term. However, prediction markets tell a different story for Main Street—Kalshi traders are betting that gas prices will remain elevated for longer as U.S.-Iran tensions continue to simmer.

“Action-starved traders are pivoting to small-cap stocks for the next big move,” noted several analysts, suggesting that while mega-cap tech continues to dominate headlines, there’s growing interest in finding value elsewhere in the market.

Earnings Season: A Mixed Bag with Bright Spots

Thursday’s earnings reports painted a nuanced picture of corporate America, with several notable beats offsetting disappointments from consumer staples giants and smaller players.

Winners of the Day

• WD-40 Company (WDFC) delivered the standout performance, reporting EPS of $2.33 versus estimates of $1.59—a massive 46% beat that likely sent shares soaring after hours.
• AZZ Inc. impressed with earnings of $1.85 per share, comfortably exceeding the $1.71 consensus estimate.
• Levi Strauss (LEVI) proved the denim icon still has legs, posting $0.28 EPS against expectations of $0.25.
• Helen of Troy (HELE) surprised to the upside with $0.17 EPS, handily beating the consensus estimate that actually anticipated a small loss.
• Simply Good Foods (SMPL) continued its healthy snacking momentum with $0.42 EPS versus $0.36 expected.
• PriceSmart (PSMT) delivered solid results at $1.28 EPS, edging past the $1.21 estimate.
• Simulations Plus (SLP) more than doubled expectations with $0.30 EPS against a $0.13 estimate.

Disappointments

• PepsiCo (PEP) narrowly missed estimates with $2.20 EPS versus the $2.23 expected—a small shortfall but notable for a bellwether consumer staples name that investors count on for consistency.
• Byrna Technologies (BYRN) significantly underperformed, posting a loss of $0.44 per share against expectations of just a $0.12 loss.
• Northern Technologies (NTIC) swung to a small loss of $0.02 versus expectations for a $0.04 profit.

Corporate Developments to Watch

Beyond earnings, several corporate stories captured trader attention. BP’s CEO announced the energy giant must “sharpen financial discipline,” a signal that could mean cost cuts or strategic pivots ahead as oil markets remain volatile amid Middle East uncertainty.

In a fascinating intersection of finance and technology, Anthropic appointed former Federal Reserve Chair Ben Bernanke to its independent trust—a move that adds significant regulatory and economic gravitas to the AI company’s governance structure as the industry faces increasing scrutiny.

Salesforce remained in focus as the cloud giant weathered a harsh analyst downgrade, though several portfolio managers indicated they’re staying the course despite the bearish call.

Looking Ahead

As we close out another volatile week, investors face a delicate balancing act. The semiconductor surge suggests continued faith in the AI-driven growth narrative, while elevated gas price expectations point to real economic consequences from geopolitical instability.

Friday’s session will likely see continued focus on any developments in the U.S.-Iran situation, with energy stocks and defense contractors potentially seeing heightened activity. The earnings calendar remains active, with Conagra Brands (CAG) results still pending and likely to provide additional color on consumer spending trends.

For now, the market’s message is clear: bet on innovation, stay nimble on geopolitics, and don’t count out the old economy names that continue to deliver.