Microsoft Moves Markets

Microsoft’s record $450 billion surge pulled investors back into AI and helped send the Nasdaq-100 up 3.4%.

Author

Elie Zakhour
July 31, 2026

Market Snapshot

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Market News

AI and Semiconductor Stocks Rebound After Strong Earnings

US stocks rebounded sharply as investors piled back into AI and semiconductor names following a recent selloff. The Nasdaq 100 surged 3.4%, while the S&P 500 gained 1.7%, led by a 16% jump in Microsoft, which added roughly $450 billion in market value, the largest one-day increase ever for a single stock. AI-related names including Bloom Energy, Sandisk, and CoreWeave also rallied more than 20% after steep declines earlier in the month.

The rally was supported by strong corporate earnings and resilient US economic data, with analysts viewing the recent pullback as a healthy reset rather than the end of the AI-driven bull market. However, strategists cautioned that the rebound may partly reflect short-covering and position unwinding rather than a sustained risk-on move.

Peel Take: The AI trade isn't dead it just took a breather. Strong earnings and continued enterprise AI spending have revived investor confidence, but with chip stocks still down sharply for the month, volatility is likely to remain a defining feature of the sector.

What's Ripe

Lam Research Corp (LRCX) 17.98% 

  • Jumped 18% after posting better than expected second-quarter earnings and revenue, as strong AI-driven demand continued to boost sales of its semiconductor manufacturing equipment.

  • Peel Take: As AI chipmakers ramp up production, the companies supplying the tools to build those chips are benefiting too. Strong results from Lam Research suggest the AI infrastructure boom is extending well beyond chip designers.

Microsoft Corp (MSFT) 15.51% 

  • Surged 16% after reporting stronger than expected fourth-quarter earnings and reaffirming its capital spending plans, easing investor concerns that AI investments were becoming excessive.

  • Peel Take: Investors aren't worried about AI spending they're worried about uncontrolled AI spending. Microsoft's results showed that heavy AI investments are translating into strong business growth, reinforcing confidence that the AI boom still has room to run.

What's Rotten

Alnylam Pharmaceuticals Inc (ALNY) 28.31%

  • Sank 28% after cutting its full-year product revenue forecast to $4.7–$5.1 billion, down from its previous guidance of $4.9–$5.3 billion, raising concerns about slower-than-expected sales growth.

  • Peel Take: Investors care just as much about future guidance as current results. Lowering its outlook signaled weaker momentum ahead, triggering a sharp selloff despite the company's long-term growth potential.

Carvana Co. (CVNA) 7.36%

  • Fell 7.4% after reporting second-quarter earnings in line with expectations, but its full-year guidance came in below Wall Street forecasts, disappointing investors looking for stronger growth.

  • Peel Take: Meeting expectations isn't always enough. With Carvana's shares having rallied strongly this year, investors wanted an upbeat outlook and anything less sparked profit-taking.

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Banana Brain Teaser

Previous

A company’s earnings per share increase by 20%, but its price-to-earnings multiple falls by 25%. Assuming nothing else changes, by approximately what percentage does the company’s share price change?

Answer: -10%

Today

An investor places 60% of a portfolio in Stock A and 40% in Stock B. Stock A rises by 15%, while Stock B falls by 5%. Approximately what is the portfolio’s total return?

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