Chipmakers lead US stocks higher in July 6 rally

US stocks closed higher Monday, with semiconductor shares powering a broad-based rally to kick off the second half of 2026.

The S&P 500 and Nasdaq Composite advanced, led by chipmakers, as investors rotated into semiconductor names to begin July trading.

"Chip packaging is becoming the next big gross margin driver for this tech giant," said Jim Cramer, host of CNBC's Mad Money, referring to the growing importance of advanced packaging in semiconductor manufacturing.

The semiconductor sector led the advance as chip shares recovered from recent weakness. Oil prices declined alongside the equity rally, according to market data. The move followed a strong first half that saw several chip stocks rank among the S&P 500's best performers, with AI-related names driving much of the gains.

The rally reflects investor conviction that AI-related chip demand will sustain growth through the second half. Navitas Semiconductor, a gallium nitride and silicon carbide power chip maker, said it will report second-quarter results on July 27 after the market close, with analysts watching for updates on data center demand and gross margin trends.

The advance extended a trend that has defined 2026: semiconductor stocks driving index-level returns as data center capital spending accelerates. Chip equipment makers and fabless designers participated in the rally, suggesting broad-based buying rather than stock-specific catalysts. The Philadelphia Semiconductor Index's trajectory will be a key barometer for tech-heavy indices in the weeks ahead.

For the second half, the outlook for chip stocks hinges on upcoming earnings reports and whether AI-related demand can sustain the sector's momentum after a strong first half. Investors will also watch for any shifts in trade policy that could affect semiconductor supply chains. The sector's ability to maintain gross margins amid rising production costs will be a key focus when companies report quarterly results later this month.

This article is for informational purposes only and does not constitute investment advice.