Stock Market News, Jan. 6, 2025: Chip Stocks Jump as Foxconn Spotlights AI Demand

U.S. equity markets had a mixed start to the first full week of 2025. The week features a Thursday trading holiday to honor former President Jimmy Carter, followed by the anticipated release of December’s jobs report on Friday.

The S&P 500 rose 0.6%, while semiconductor optimism pushed the Nasdaq up 1.2%. The Dow, which had been positive for most of the day, dipped slightly to close with a loss of less than 0.1%.

Semiconductor Sector Shines

Taiwanese tech giant Foxconn reported record fourth-quarter revenue, citing robust demand for artificial intelligence (AI) servers. This news fueled gains in semiconductor stocks, including Nvidia (NVDA), which climbed 3.4%. Micron Technology (MU) surged 10.5%, making it the top performer in the S&P 500, as its memory solutions are integral to Nvidia’s next-generation Blackwell AI platforms.

Super Micro Computer (SMCI) saw its shares soar 9.4%, buoyed by optimism over AI servers and positive commentary from Lynx Equity. Nvidia’s keynote address at the CES conference, expected to highlight advancements in its Blackwell AI chips, could further benefit Supermicro, whose advanced servers heavily rely on Nvidia’s GPUs.

Teradyne (TER) shares jumped 7.2% after Northland Securities upgraded the stock to “outperform” and raised its price target. Analysts see Teradyne gaining market share as cloud companies adopt its testing platforms for application-specific integrated circuits (ASICs). The ongoing transition within the semiconductor sector is also expected to drive demand for its products.

Notable Declines

Axon Enterprise (AXON), known for its Tasers and law enforcement technology, fell 5.1%, marking its lowest level since posting strong quarterly results in November. Despite the dip, Axon shares remain over 100% higher than a year ago, fueled by interest in its AI capabilities and growing police technology budgets.

Palantir Technologies (PLTR) dropped 5% after Morgan Stanley reinstated coverage with an “underweight” rating. While analysts acknowledged Palantir’s growth potential, they noted that its high valuation—following a stellar 2024 performance—may already reflect much of its future upside.

Essex Property Trust (ESS) declined 4% after Mizuho reduced its price target. The REIT, focused on West Coast apartment complexes, faces challenges from shifting employment and rental trends, particularly in Northern California’s tech-heavy regions.

T-Mobile US (TMUS) slid 3.1% after downgrades by Wells Fargo and RBC. Analysts raised concerns about its valuation and projected slower growth in 2025, including a drop in wholesale revenue.