AMD-Meta Deal Ignites Semiconductor Rally
Advanced Micro Devices (AMD) jumped 8.94% to close at $213.72 on Monday, leading a powerful semiconductor sector rally. The surge followed reports of a significant AI chip deal between AMD and Meta Platforms, providing concrete evidence of AMD's competitive positioning in the crucial artificial intelligence hardware market.
Trading volume in AMD exploded to over 75.5 million shares, more than double its recent average. The broader semiconductor sector gained 3.67%, with Oracle and Adobe also posting strong gains of 3.66% and 3.33% respectively. This marked a decisive shift from last week's sector weakness.
Broad Market Participation Signals Healthy Rebound
Monday's rally showed impressive breadth, with 23 major stocks advancing versus just 7 declining. The average gain across tracked stocks was 1.04%, the strongest single-day performance in recent weeks. This represents a sharp reversal from Friday's session, which saw 22 decliners and an average loss of nearly 1%.
Home Depot (HD) contributed to the positive sentiment, rising 2.61% after reporting fiscal 2025 sales of $164.7 billion, up 3.2% from the prior year. The home improvement retailer pointed to relatively stable underlying demand despite ongoing pressure in housing, providing a secondary catalyst for market optimism.
Technology and Consumer Sectors Show Strength
Beyond semiconductors, several technology and consumer discretionary names participated in the advance. Apple gained 1.49%, Amazon rose 1.42%, and Tesla added 2.40%. Microsoft posted a more modest 0.73% gain, while NVIDIA edged up 0.35% on heavy volume of 146.7 million shares.
The communication services sector advanced 2.38%, supported by Netflix's 3.07% gain. Only healthcare showed meaningful weakness, declining 2.19% amid a 3.08% drop in UnitedHealth. The broad participation suggests the rally wasn't confined to a single catalyst or sector.
Market Context and Next Session Watchpoints
Monday's rally comes after a challenging period for technology stocks. The Nasdaq had struggled for direction in recent sessions as investors weighed AI's business impact. According to market analysts, the first two months of 2026 have featured a near-daily fight between Wall Street's bulls and bears regarding AI's ultimate effect.
Traders will watch whether Tuesday's session confirms Monday's strength or sees profit-taking. Key indicators include follow-through volume in semiconductor names and whether the positive breadth persists. The AMD-Meta deal's details and any competitive responses from other chipmakers will remain in focus.