What’s News in Markets: Middle East Strikes Send Oil Higher, South Korean Chip Stocks Fall, SpaceX Stumbles

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Imani Moise (0:18)

Hey, listeners. It's Saturday, July 11th. I'm Imani Moise for The Wall Street Journal. And this is What's News in Markets, our look at the biggest stock moves of the week and the news that drove them. Let's dive in.

When traders shut down their terminals last week for the long holiday weekend, they were hoping the peace deal in the Middle East would hold, that chip maker earnings would fuel another AI rally, and that SpaceX's addition to a major stock index would give its shares another boost. But none of that happened. So Markets spent the week recalibrating. Overall, the S&P 500 rose 1.2% this week, while the NASDAQ gained 1.7%.

The Dow slipped about half a percent lower.

Here we go again. That's how analysts summed up Wall Street's mood this week. Investors had spent the past two weeks betting that the worst of the conflict between the US and Iran was in the rearview mirror. Oil prices had fallen back to pre-war levels, and stocks climbed to fresh records. But by Tuesday, missiles were flying again, and President Trump officially declared the ceasefire was over the next day. Oil prices shot higher as investors dusted off their wartime playbook. Brunch crude surged 5.4% this week to settle just above $76 a barrel. The rally spilled over into energy stocks, which were beaten down during the peace trade. Energy was one of the top-performing sectors in the S&P this week, rising 3.2%.

Baker Hughes and Phillips 66 led the gains, with stocks climbing about 7 and 9% respectively.

One place investors have looked for shelter from the geopolitical whiplash has been AI, but even that trade has started to get a little shaky. South Korea's KOSPI has been one of the world's best-performing stock markets this year, thanks to AI chip heavyweights like Samsung and SK Hynix, which make up more than half of the market. But it briefly flirted with bear market territory this week after investors dumped those stocks. Samsung shares fell 8%, despite projecting a 19-fold jump in quarterly profit on Tuesday. Analysts say the results weren't disappointing. Expectations were just higher. The sell-off spread to rival SK Hynix, which ended the week 10% lower in South Korea. Another theory is that investors were simply locking in profits. Samsung shares are still up 138% this year, while SK Hynix has more than tripled as demand for AI memory chips has exploded. But by Friday, Wall Street was all in. SK Hynix made its NASDAQ debut after raising more than $26 billion in the largest share sale ever by a foreign company. The company rallied 13% on its first day of trading in the US.

And SpaceX stock didn't take off the way investors expected in its first week as a member of the NASDAQ 100 The company officially joined the tech-heavy index on Tuesday, forcing index funds with roughly $800 billion in assets to buy the stock. Many investors hoped that a wave of automatic demand would give shares another boost. Instead, SpaceX shares fell 10% this week, slipping below the opening price from last month's IPO. Part of the problem is that Wall Street still can't agree on what Elon Musk's company is actually worth. Analysts kicked off coverage this week with price targets ranging from $165 a share to as high as $800 a share. That kind of disagreement can be a warning sign. According to Trivariate Research, stocks with widely scattered analyst price targets have historically underperformed stocks where Wall Street is largely in agreement.

And now you know What's News in Markets this week. You could read about more stocks that moved on the week's news in our live markets coverage on wsj.com. Today's show was produced by Anthony Bansi with supervising producer Melanie Roy. I'm Imani Moise. Have a great weekend and catch you next Saturday.

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