Stocks to Watch: AI Hardware Ahead of Software by 5.6 Points in Premarket Action

NEW YORK, August 17, 2026, 09:25 EDT — U.S. cash markets begin trading at 09:30 EDT, with premarket activity currently ongoing.

A group of four U.S. memory stocks averaged a 3.7% gain ahead of Monday’s session, while a basket of four software stocks slipped 2.0%. The resulting 5.6-point gap marks hardware rotation as the most prominent stock-picking trend today.

The split is more significant than the index movement. It indicates investors are valuing limited AI infrastructure and reducing exposure to application software. This reflects targeted risk-taking rather than widespread market gains.

At 08:34 EDT, Nasdaq 100 futures gained 0.33%. S&P 500 futures edged up 0.04% and Dow futures slipped 0.33%.

Stock	Premarket move	Immediate catalyst	Investor read-through
Micron Technology NASDAQ:MU	+3.4% to +3.5%	U.S agencies urged Apple NASDAQ:AAPL not to buy Chinese memory	Policy actions aid continued firm pricing for memory
Sandisk NASDAQ:SNDK	+4.9%	Policy impacts on memory and increased AI-related demand for storage	Outpaced other memory stocks
L3Harris Technologies NYSE:LHX	about -3.0%	CEO ousted after conduct review by board	Boardroom risk, underlying business unchanged
Alibaba Group NYSE:BABA	about +0.9%	Struck deal to sell Lingxi Games for $2 billion-plus	Reallocating funds to AI and cloud projects
Alphabet NASDAQ:GOOGL	modestly higher	Berkshire Hathaway expanded its stake by 83%	Additional backing from a well-known long-term investor

Premarket indications from Reuters, Barron’s and The Wall Street Journal at the cited times. WSJ stocks to watch

Micron heads the list of stocks in focus. U.S. Commerce Secretary Howard Lutnick stated that U.S. firms had been cautioned on obtaining memory from China. Shares traded at approximately $1,006 in premarket action.

The policy shift spread throughout the storage sector. Shares of Western Digital NASDAQ:WDC climbed 3.7%, Seagate Technology NASDAQ:STX increased 2.6%, while Sandisk advanced 4.9%. The average gain among the three was 3.9%.

Basket	Constituents	Average premarket move	Signal
Memory hardware	MU, SNDK, WDC, STX	+3.7%	Premium reflects scarcity and policy
Application software	ORCL, NOW, TTD, WDAY	-2.0%	Main funding source for hardware demand
Hardware minus software	Equal-weight spread	+5.6 percentage points	Sharpest rotation since the close on Friday

Equal-weight calculations from reported premarket moves. Oracle NYSE:ORCL, ServiceNow NYSE:NOW, Trade Desk NASDAQ:TTD and Workday NASDAQ:WDAY were all lower. Barron’s source data

AJ Bell’s (LON:AJB) Danni Hewson said investors are monitoring “where money is being spent, where the returns are coming from.” That reflects Monday’s trading. Prices in memory provide more immediate evidence than projections related to software. Reuters

L3Harris presents the primary company-specific risk. Following Christopher Kubasik’s departure, the board appointed Sam Mehta as chief executive. The company stated the situation did not impact reporting, controls, customers or operational activities.

Mehta was already in charge of divisions generating nearly 80% of L3Harris’s revenue, reducing the chance of operational disruption. The fall in shares instead reflects uncertainty around governance and potential risks from the leadership transition.

Alibaba is taking a different approach. A source told Reuters its sale of Lingxi Games is worth over $2 billion. The sale supports a strategic move toward AI and cloud computing.

Alphabet is also in focus. Berkshire Hathaway NYSE:BRK.B increased its stake by 83%, bringing its total to almost 106 million shares. With a value of $37.8 billion, the holding is now Berkshire’s third-biggest equity investment.

Company	Firm	Recommendation	Target	Date
Micron	UBS NYSE:UBS	Buy rating reiterated	$1,625	August 15
Sandisk	J.P. Morgan NYSE:JPM	Overweight	$2,250	August 14
L3Harris	Bernstein	Outperform	$435	February 26
Alibaba	HSBC NYSE:HSBC	Buy	$170	July 9
Alphabet	Cantor Fitzgerald	Overweight	$420	July 23

Latest cited analyst recommendations are not guarantees. Sources: UBS on Micron, J.P. Morgan on Sandisk, Bernstein on L3Harris, HSBC on Alibaba, and Cantor on Alphabet.

The earnings environment continues to look positive. Out of 453 S&P 500 firms that have reported so far, 84.8% surpassed expectations. Walmart NYSE:WMT and Home Depot NYSE:HD will release their results later this week.

Risks: Escalating tensions in the Middle East and changes in oil prices may undermine support for hardware. A soft market open could test gains made in light premarket trading. News on leadership or M&A can trigger significant gaps after 09:30 EDT.

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Further analysis

Editorial insight

What is causing memory stocks to outperform ahead of the Monday market open?

Backing from policy and pricing is boosting the AI-memory market. Micron advanced roughly 3.5%, with Sandisk up 4.9%. Western Digital and Seagate climbed as well after U.S. authorities advised Apple against buying memory from China.

Is the surge in hardware stocks an indication of widespread risk appetite?

Not at this point. The equal-weight memory basket climbed 3.7%, whereas a software basket made up of four stocks declined by 2.0%. Nasdaq futures advanced 0.33%, and S&P 500 futures were little changed. The data suggests a targeted rotation, rather than a broad rally.

What are the key considerations for L3Harris shareholders now?

The primary concern is governance rather than reported operations. Shares dropped nearly 3% following the board's decision to oust Christopher Kubasik and name Sam Mehta as his replacement. L3Harris stated that the conduct issue had no impact on financial reporting, controls, customers or overall operating performance.

What might cause a turnaround in premarket activity today?

Rising oil prices and heightened Middle East tensions pose the biggest cross-asset risks. Limited premarket liquidity is also adding to market uncertainty. Investors are monitoring if the rally in memory stocks continues past 09:30 EDT and whether the decline in software spreads to other sectors.