Micron Technology (MU -4.23%) stock began the day up, rising as much as 6.4%, before reversing course. Shares are now down 4.1% from the opening bell as of 3:05 p.m. ET on Friday. The S&P 500 was up 0.6% while the Nasdaq Composite gained 1%.
Micron's early jump was driven by fresh earnings from Apple and Amazon that showed no plans to shrink spending on memory chips. That wasn't enough to outweigh fear around rising interest rates.
NASDAQ: MU
Key Data Points
Memory spending continues
Just days after Alphabet told investors it had no plans to reduce its capital expenditures, Apple and Amazon reiterated their spending plans, with Amazon upping its 2026 budget to $220 billion. Apple leadership told investors the memory supply crunch that has been fueling Micron and other memory-makers' revenue growth will continue for the foreseeable future.
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Interest rates on the rise
After the Federal Reserve announced it would not raise interest rates this week, despite persistent inflation, the bond market has reacted, and rates have reached 19-year highs. Higher rates, whether or not they are driven by the Fed, tend to weigh on stock prices, especially high-growth stocks like Micron.
The bottom line
Micron is likely to see its earnings continue to soar as the supply crunch continues, but I don't think it will last as some believe, and, with that in mind, the valuation is too rich for me.
