$28B SK Hynix IPO looms as AI stocks roar back 5%+

A sharp recovery in artificial intelligence names drove a mixed but positive start to the week on Wall Street, with the S&P 500 rising 0.5% and the Nasdaq Composite gaining 1.1% in early trading on Monday, July 6, 2026. The Dow Jones Industrial Average, however, moved modestly — down 160 points or 0.3% according to initial reports, though some flashes showed a slight gain — reflecting continued divergence beneath the surface. The real story was the ferocious snap-back in AI semiconductor and infrastructure plays, which had been pummelled in a late‑June rout. Broadcom surged 5.3%, Micron Technology climbed 4.2%, and memory giant SK Hynix, despite a 14.6% single‑day plunge on Thursday, managed to set the stage for what is set to be the second‑largest U.S. initial public offering in history. The recovery comes against a backdrop of intensifying debate over whether the hundreds of billions being poured into AI chips and data centers can ever generate sufficient productivity and profit returns to justify current valuations. The AI sector had suffered a brutal end to the final week of June and the shortened holiday week, with Broadcom and Micron each losing more than 2% on both Wednesday and Thursday before the Fourth of July holiday. Those losses took place amid a broader rotation out of high‑flying tech, as doubts grew about the durability of the AI capex cycle. The rebound on Monday, while broad within the AI complex, was far from unanimous across the broader market: declining issues outnumbered gainers on the S&P 500, illustrating the narrow leadership that has defined this bull leg. At the center of the week’s test of global AI demand sits SK Hynix, the South Korean memory chipmaker whose shares have already tripled in 2026 as the primary beneficiary of high‑bandwidth memory (HBM) demand for Nvidia’s GPUs. The company plans to raise a staggering $28 billion through a U.S. offering of shares on the Nasdaq, setting it up to be one of the largest IPOs ever, trailing only SpaceX’s $75 billion debut a month ago. SK Hynix’s stock in Seoul, despite its year‑to‑date surge, has whipsawed dramatically — a 14.6% crash on Thursday alone underscored the fragility beneath the euphoria. The IPO itself is being viewed as a crucial litmus test: a successful pricing would validate that institutional and retail appetite for AI‑adjacent equities remains robust; a tepid reception could freeze the pipeline and trigger a fresh down‑leg in AI sectors globally. Meanwhile, SpaceX — which owns xAI — continues its own post‑IPO journey. The stock rose 1.2% in its final trading day before inclusion in the Nasdaq‑100 index, a move that will force large passive funds like the Invesco QQQ ETF to mechanically buy shares, providing a tailwind. The index inclusion underscores how deeply AI has permeated the mega‑cap space, but also heightens concentration risk for those tracking the benchmark. In a sign that the AI infrastructure build‑out is moving from chip fabs to actual electricity consumption, TeraWulf, a bitcoin miner turned data‑center operator, rocketed 16.9% after announcing a 20‑year, $19 billion deal to provide Anthropic with data center capacity in Kentucky. The deal, one of the largest ever signed for AI compute infrastructure, highlights the insatiable power and cooling demands of frontier AI models and the scramble by hyperscalers to lock in long‑term capacity. TeraWulf, with its existing low‑cost power access and mining‑turned‑AI pivot, becomes a proxy for the physical infrastructure layer of the AI revolution. For investors, the day’s action reinforces a delicate equilibrium. On one hand, the AI trade is alive and able to regenerate momentum quickly; on the other, the violent swings of the past two weeks — from euphoric peaks to panic sell‑offs — signal a market that is less about discounted‑cash‑flow analysis and more about sentiment and flow dynamics. The $28 billion SK Hynix deal and the $19 billion TeraWulf agreement represent material validation of the thesis that AI infrastructure spending is accelerating, not decelerating. Yet the speed and scale of the capital being committed, alongside the breathless equity issuance, raise the specter of a classic boom‑bust cycle. As passive flows, IPO catalysts, and energy‑demand deals converge, the next fortnight will be critical in determining whether AI stocks can carve out a sustainable plateau or whether the summer pullback merely resumed.