Technology stocks swept broadly higher on Wednesday in a session that investors and analysts are cautiously labeling a relief rally, as the Nasdaq 100 climbed more than 1% and beaten-down software and semiconductor names attracted bargain hunters looking to capitalize on a sector that has fallen sharply since late January. The catalyst for the morning's enthusiasm was a major chip supply agreement between Meta Platforms and Advanced Micro Devices, which sent AMD shares soaring approximately 9%.
Meta disclosed that it has entered into a multiyear partnership with AMD under which the social media giant will purchase millions of the chipmaker's AI accelerators, with shipments expected to begin in the second half of 2026. The announcement came on the heels of a separate, already-announced long-term partnership between Meta and Nvidia for Blackwell and Rubin processors, underscoring the company's strategy of diversifying its AI chip supply chain. Together, these deals position Meta as one of the most aggressive spenders in the AI infrastructure race, consistent with its previously disclosed plans to invest upward of $65 billion in capital expenditures this year.
The broader AI-anxiety narrative that has hammered software stocks this month — driven by concerns that rapidly improving AI models will compress the pricing power and addressable markets of enterprise software vendors — showed signs of temporary abatement. Salesforce and ServiceNow both added more than 2%, while cybersecurity names including Zscaler and Cloudflare clawed back ground after a sharp Monday selloff. The iShares Expanded Tech-Software Sector ETF (IGV) rose more than 1% in morning trading after collapsing nearly 5% in the prior session.
Not every name participated in the recovery. Workday (WDAY) dropped approximately 7% after the human capital management software provider issued a revenue forecast that fell short of analyst expectations, citing a pullback in corporate spending on traditional software platforms. The result added fuel to the debate about whether enterprise SaaS companies face a structural headwind from AI tools that may allow organizations to achieve more with fewer software licenses. Workday shares are down roughly 39% year-to-date as the AI scare trade has weighed on the segment.
Elsewhere in the earnings landscape, Cava Group jumped more than 8% after the fast-casual Mediterranean chain beat fourth-quarter profit targets and raised its fiscal 2026 outlook, offering a bright spot in the consumer sector. Keysight Technologies surged more than 23% following strong quarterly results and analyst upgrades. Conversely, First Solar fell more than 16% after missing Q4 estimates and providing a tepid 2026 outlook, a reminder that clean energy names face their own margin and demand headwinds.
Market participants also continued to process commentary from Federal Reserve Governor Lisa Cook, who warned on Tuesday that AI-driven productivity gains could generate structural unemployment that monetary policy is ill-equipped to address. While the near-term read-through for equities is ambiguous, the Fed's growing attention to AI's labor market implications suggests the central bank may exercise additional caution before resuming rate cuts, keeping short-term rate expectations in flux as the earnings season approaches its conclusion.