By Chibuike Oguh and Amanda Cooper
NEW YORK/LONDON, June 24 (Reuters) – Stocks rebounded on Wednesday from a rout in technology shares partly driven by concerns about stretched valuations, while the dollar climbed to a one-year peak.
Technology stocks, which were hit hard on Tuesday, edged up ahead of earnings from chipmaker Micron, whose products help power the AI boom. But sentiment remained fragile as investors priced in at least one rate hike from the Federal Reserve this year.
On Wall Street, all three indexes were higher with consumer discretionary, industrials and materials stocks driving gains. Energy stocks were the biggest losers as the continued flow of crude oil through the Strait of Hormuz pushed prices toward four-month lows.
The Dow Jones Industrial Average rose 1.12%, the S&P 500 rose 0.84%, and the Nasdaq Composite rose 0.89%.
“We’re probably approaching peak hawkishness in terms of interpreting the Fed’s new stance and it looks like that’s what’s primarily driving asset prices,” said Wasif Latif, chief investment officer at Sarmaya Partners.
“Today, there’s a bit of balance in equities that can be related to the bounce off the pretty meaningful selloff yesterday but also investors are trying to anticipate and position the upcoming earnings announcement from Micron.”
MSCI’s gauge of stocks across the globe rose 0.45%.
MSCI’s index of Asian equities outside Japan rose 0.15%. South Korea’s KOSPI gained 3.5% after dropping 10% in the prior session.
In Europe, the broader regional stock market was roughly unchanged on the day. A 15% plunge in shares of defence company Rheinmetall, after media reports of the German government planning to scrap a delayed multibillion-euro frigate project, was partly offset by gains in a scattering of heavyweight luxury and tech stocks.
STRAIT OF HORMUZ
Crude oil prices fell, extending this week’s losses and trading near four-month lows, on signs that more tankers stranded in the Gulf are set to move out of the Strait of Hormuz.
There is a lot of uncertainty about the outlook, given the U.S. and Iran have provided conflicting accounts about what the two countries have agreed as part of their peace deal, including key elements such as nuclear inspections and control of the strait.
Brent fell to $73.53 per barrel, down 4.55% on the day.
DOLLAR JUMPS
The U.S. dollar rose for a third straight day against a basket of major currencies to its highest in a year as markets anticipate Fed rate hikes.
The euro, however, was one of the main victims of dollar strength, as investors lowered their expectations for the European Central Bank to raise rates much more this year, while pricing in a greater chance that the Fed will lift borrowing costs.
The euro was trading around its lowest in a year, down for a third day at $1.1354.
The yen was also weaker on the day, trading around 161.77, keeping markets on edge over a potential currency intervention to prop up the battered Japanese currency.
The dollar index rose 0.21% to 101.60, hitting its highest level since May 2025.
Gold prices fell to a more than seven-month low under pressure from a firmer U.S. dollar.
Spot gold fell 2.35% to $4,011.69 an ounce.
(Reporting by Chibuike Oguh in New York; Additional reporting by Satoshi Sugiyama in TokyoEditing by Lincoln Feast and Nia Williams)