Key Highlights

● The Philadelphia Semiconductor Index rose for a fourth straight day.

● Applied Materials supplies tools across memory, logic and packaging.

● SK hynix's shortage outlook suggests capacity expansion ahead.

● Nvidia lagged even as most peers in the sector rallied.

Applied Materials (NASDAQ:AMAT) rallied on Wednesday, October 28, joining a broad advance in semiconductor stocks that carried the sector benchmark higher for a fourth consecutive day.

One of the world's largest makers of chip-manufacturing equipment was among the standout technology gainers in the S&P 500, moving in step with rival Lam Research (NASDAQ:LRCX).

The Fourth Straight Gain

The Philadelphia Semiconductor Index closed at 11,684.00, extending a winning streak that has made chips the engine of the Nasdaq this week. Technology was the best-performing of the 11 S&P 500 sectors on Wednesday.

The latest leg of the rally was powered by memory. SK hynix (NASDAQ:SKHY) reported its first quarter with more than 100 trillion won in revenue, roughly $78.7 billion, and said it sees the memory shortage lasting into 2030. Its US-listed shares jumped, and Micron (NASDAQ:MU) and Sandisk (NASDAQ:SNDK) climbed with them.

Why Equipment Makers Benefit

Applied Materials sells the machines that chipmakers use to deposit, etch, inspect and modify the microscopic layers on silicon wafers. When chip producers expect strong demand for years, they invest in new factories and upgrade existing ones, which means more orders for Applied's tools.

A memory shortage projected to run into 2030 suggests memory makers will need to expand capacity, and Applied supplies equipment used across memory, logic and advanced packaging. KLA (NASDAQ:KLAC), another equipment maker, rose in extended trading after beating revenue and earnings expectations and issuing strong guidance tied to AI build-out demand.

The AI Investment Wave

The wider AI infrastructure trade also lent support. Vertiv Holdings (NYSE:VRT) rocketed after orders more than doubled, and Oracle (NYSE:ORCL) soared after setting a $225 billion fiscal 2030 revenue target and capping new fundraising at $20 billion.

Nvidia (NASDAQ:NVDA), the biggest name in AI chips, was a notable laggard and slipped. The S&P 500 rose 21.38 points to 7,743.98, its third straight gain, while breadth was narrow, with the equal-weight S&P 500 slipping slightly.

What to Watch

Chip stocks faced a mixed handoff after the bell. Alphabet (NASDAQ:GOOGL) slid sharply in extended trading after missing profit expectations and reporting negative free cash flow, and Micron and Nvidia slipped in sympathy. However, Alphabet raised its 2026 capital spending forecast to between $195 billion and $205 billion, and Microsoft (NASDAQ:MSFT) rose after its Azure cloud business accelerated.

Amazon (NASDAQ:AMZN) reports after Thursday's close, and Apple (NASDAQ:AAPL) and Meta (NASDAQ:META) report later this week, giving investors more clues on AI spending plans.