US Open: Wall Street continue to rise despite US - Iran tensions 📈 Micron Technology rises 10%

• Donald Trump said negotiations with Iran were “proceeding nicely,” although he warned that the U.S. could escalate military action if talks fail.
• The U.S. confirmed conducting “self-defense strikes” in southern Iran, targeting missile launch sites and vessels allegedly attempting to deploy mines.
• U.S. Treasury yields declined as markets reopened after the Memorial Day holiday, with the 10-year yield falling below 4.5%.
• Investors are scaling back expectations for near-term Fed rate cuts, with markets now pricing in an 8.5% probability of a July rate hike, up from just 0.9% a month ago.
• Markets are awaiting the Conference Board’s U.S. consumer sentiment data, scheduled for release at 3 PM GMT. The strongest gains are currently visible among semiconductor manufacturers - especially Micron.

US100 (D1 interval)

Source: xStation5

Company news

The broader semiconductor sector is moving higher, with Qualcomm and Advanced Micro Devices (AMD) both gaining more than 3%, while Micron Technology has become the market’s key focus. Meanwhile, the oil sector is underperforming relative to crude prices - BP shares are down nearly 4% after the unexpected dismissal of Chairman Albert Manifold amid concerns related to governance oversight and management standards.

Shares of Lear Corp. gained 2% after TD Cowen upgraded the stock from “Hold” to “Buy.” The bank argued that the automotive supplier is well positioned for North American vehicle production, which analysts expect could prove stronger than previously anticipated.

UBS upgrades Micron Technology – shares surge

Micron Technology shares are rallying sharply in premarket trading after UBS more than tripled its price target on the company to $1,625 from $535. This is not simply a cyclical upgrade tied to improving DRAM/NAND pricing, but rather a broader thesis that the memory market is entering a structurally more favorable phase thanks to long-term supply agreements with major customers.

• According to UBS, an increasing share of DDR volumes - particularly server-grade DDR5 is now being secured under 3–5 year agreements featuring guaranteed volumes and partially fixed pricing frameworks. For Micron, this could translate into lower earnings volatility, improved demand visibility, and a smoother margin profile in what has historically been one of the semiconductor industry’s most cyclical segments.
• Importantly, hyperscalers are estimated to have already locked in roughly 60 - 70% of industry-wide server DDR5 volumes under these enhanced agreements. This strengthens Micron’s position in the highest-value segment of the memory market, where demand is being driven by AI infrastructure, data centers, and growing bandwidth requirements.
• UBS raised its EPS forecasts for Micron to $155 in 2027, $167 in 2028, and $117 in 2029. Analysts expect earnings per share to remain comfortably above $100 even in the event of a moderate memory downcycle in 2029.
• The new UBS price target implies more than 100% upside potential and is based on roughly 15x forward earnings. The bank argues that with greater earnings stability and memory’s increasingly strategic role within the AI ecosystem, Micron should no longer trade at such a large valuation discount relative to semiconductor leaders such as Nvidia.

The constructive outlook was reinforced by Mizuho, which reiterated its Outperform rating and continues to view Micron as one of its top semiconductor picks. According to the bank, DRAM and NAND memory remain foundational technologies for AI infrastructure, with demand likely to exceed supply at least through 2026–2027.

Micron shares (MU.US)

Source: xStation5