Wall Street steadies as chip stocks bounce back and oil prices ease
[January 16, 2026] By
STAN CHOE
NEW YORK (AP) — Wall Street steadied on Thursday as stocks in the
artificial-intelligence industry bounced back following an encouraging
report from a Taiwanese chip giant and as oil prices eased sharply.
The S&P 500 rose 0.3% and snapped the two-day losing streak it had been
on since setting an all-time high. The Dow Jones Industrial Average
added 292 points, or 0.6%, and the Nasdaq composite rose 0.2%.
Nvidia and other formerly high-flying AI stocks helped lift the market
after Taiwan Semiconductor Manufacturing Co., a major supplier to the
industry, reported a stronger profit for the latest quarter than
analysts expected. TSMC also said it could boost its investment in
equipment to $56 billion this year to take advantage of the AI boom.
The frenzy around AI has already sent Nvidia and other superstar stocks
to dizzying heights, but that stirred criticism that their prices had
shot too high. Nvidia was one of the heaviest weights on the S&P 500
Wednesday after sinking 1.4%. But it rose 2.1% after TSMC Chief
Financial Officer Wendell Huang said it’s seeing “continued strong
demand” in an encouraging signal for the entire AI industry.
TSMC is a crucial player as a major supplier for Nvidia and other giants
and as a key customer for ASML and other providers. TSMC’s stock that
trades in the United States rose 4.4%, while ASML’s U.S.-listed stock
rallied 5.4%.
Other chip-related companies helped lead the U.S. stock market,
including gains of 7.7% for KLA Corp. and 5.7% for Applied Materials.
Also helping to calm financial markets was a sharp easing in oil prices.
A barrel of benchmark U.S. crude sank 4.6% to $59.19, while Brent crude,
the international standard, dropped 4.1% to settle at $63.76 per barrel.
Analysts pointed to comments from President Donald Trump, who said
Wednesday afternoon that he heard “on good authority” that plans for
executions in Iran have stopped amid widespread protests against the
country’s leadership.
Financial markets took that as a signal that tensions flaring above some
of the world’s largest oil deposits could ease, which in turn could
lower the possibility of a disruption to the flow of oil.
Gold’s price edged back 0.3% in another signal of potentially calming
nerves across financial markets.
Earnings reporting season for big U.S. companies continued to pick up
pace, meanwhile, with several more big financial companies delivering
their results for the last three months of 2025.
BlackRock, the giant that’s now overseeing more than $14 trillion in
investments, rose 5.9% after reporting stronger profit and revenue than
analysts expected.
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Trader Michael Capolino works on the floor of the New York Stock
Exchange, Monday, Jan. 12, 2026. (AP Photo/Richard Drew)
 Morgan Stanley climbed 5.8% after
likewise delivering stronger profit and revenue than expected.
Goldman Sachs rose 4.6% after the investment bank topped analysts’
forecasts for profit but fell short on revenue.
Outside of earnings, Boston Scientific fell 4% after announcing it‘s
buying Penumbra, whose products help remove blood clots, in a cash
and stock deal valued at roughly $14.5 billion. Penumbra’s stock
jumped 11.8%.
In the bond market, Treasury yields rose following encouraging
reports on the U.S. economy.
One said fewer workers applied for unemployment benefits last week
in an indication that the pace of layoffs may be slowing. Other
reports, meanwhile, said manufacturing was significantly stronger in
the mid-Atlantic region and in New York state than economists
expected.
The yield on the 10-year Treasury climbed to 4.17% from 4.12% just
before the release of the reports. It was at 4.15% late Wednesday.
The stronger-than-expected data on the U.S. economy helped stocks of
smaller companies to lead the market. Their profits can be tied more
closely to the strength of the U.S. economy than their bigger,
multinational rivals, and the Russell 2000 index rose 0.9%.
All told, the S&P 500 rose 17.87 points to 6,944.47. The Dow Jones
Industrial Average added 292.81 to 49,442.44, and the Nasdaq
composite gained 58.27 to 23,530.02.
In stock markets abroad, indexes were mixed across Europe and Asia.
South Korea’s Kospi jumped 1.6% for one of the world’s bigger moves.
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AP Business Writers Chan Ho-him and Matt Ott contributed.
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