S&P 500 Rebound Tests Whether AI Sell-Off Is Only a Valuation Reset

U.S. stocks rebounded following a brutal two-day sell-off, with the S&P 500 rising 0.27% as investors await Micron Technology's earnings to determine if the recent AI sector decline is merely a valuation reset or signals a broader reassessment of AI investments. The semiconductor index plunged 8% amid concerns about whether massive AI infrastructure spending will translate into profits, while the Fed's hawkish stance has increased rate hike expectations to 70% for September.