In this article, we will look at the 5 Stocks Dominating Today’s Market Action. For a deeper discussion and an extended list, please see 10 Stocks Dominating Today’s Market Action.

5. Lumentum Holdings Inc. (NASDAQ:LITE)

Lumentum Holdings extended its winning streak to a fifth straight session on Thursday, jumping 10.18 percent to close at $772.13 apiece, as investors took heart from Bank of America’s (BofA) price target rating and optimistic outlook for the AI optics market, saying that the total addressable market could hit $90 billion over the next four years.

In a market note, BofA raised its price target for Lumentum Holdings Inc. (NASDAQ:LITE) by 29 percent to $775 from $600 previously, following the latter’s comments that it expects the market to grow at a compounded annual growth rate (CAGR) of 40 percent from last year’s $18 billion.

Lumentum Holdings Inc. (NASDAQ:LITE) said that the expansion is expected to be supported by pluggables, lasers, co-packaged optics, optical circuit switches, and data center interconnects, among others.

Analyst upgrades aside, the rally can also be attributed to continued portfolio positioning, ahead of Lumentum Holdings Inc.’s (NASDAQ:LITE) official inclusion in the S&P 500 index effective Monday, March 23.

Listed companies typically experience significant movements in their share prices during index rebalancing activities, as funds and institutional investors would need to reposition their portfolios to mirror the composition of the index being tracked before the effective date.

Its inclusion in the S&P 500 marks a significant milestone and promotion, after being a previous component of the S&P MidCap 400.

4. Erasca Inc. (NASDAQ:ERAS)

Erasca rallied for a second day on Thursday, jumping 13.04 percent to close at $15.26 apiece on strong investor optimism, backed by earlier optimistic coverage from several analysts.

Year-to-date, the company has already seen its stock price soar by 310 percent, making it one of the top-performing stocks this year.

Investors are also positioning portfolios ahead of initial data from clinical trials to test the efficacy of its treatment candidate, ERAS-0015, in patients with RAS-mutant solid tumors in the US and China.

In January this year, ERAS-0015 showed early promising results in one of Erasca Inc.’s (NASDAQ:ERAS) clinical studies, particularly during dose escalations.

According to the company, it saw two confirmed partial responses and one unconfirmed partial response during the clinical study of its pan-RAS molecular glue degrader ERAS-0015.

In addition, more unconfirmed responses were observed in patients taking 8 mg doses, with consistent, linear pharmacokinetics across all dose levels evaluated and no evidence of exposure plateau so far.

3. Vermilion Energy Inc. (NYSE:VET)

Vermilion Energy saw its share prices jump to a new two-year high on Thursday, as investors gobbled up shares in liquefied natural gas (LNG) producers amid the surging prices of the commodity as a result of ongoing tensions in the Middle East.

This followed a recent missile attack on Qatar’s Ras Laffan gas hubs, causing an “extensive damage,” according to the state-run energy firm.

Ras Laffan is Qatar’s main site for producing LNG, which is used for cooking, heating homes, and generating electricity. The hub is currently attributed to about a fifth of the world’s LNG supply.

The attacks sparked higher natural gas prices on the same day, with data from Trading Economics showing a jump of 1.72 percent to $3.12/MMBtu in the said commodity.

Shares of Vermilion Energy Inc. (NYSE:VET) mirrored the rally, with the stock climbing to its highest price of $14.69 before paring gains to finish the session just up by 14.35 percent at $14.42 apiece.

In other news, Vermilion Energy Inc. (NYSE:VET) is set to pay on March 31 worth $0.135 worth of dividends to all shareholders of record on March 13.

Vermilion Energy Inc. (NYSE:VET) is a Canada-based producer of natural gas, with operations located in Canada, France, the Netherlands, Australia, Germany, and Ireland.

2. Tower Semiconductor Ltd. (NASDAQ:TSEM)

Tower Semiconductor soared to a nearly 25-year high on Thursday, following news that it teamed up with Oriole Networks to develop AI infrastructure products in line with the aim to tap an expected $80-billion total addressable market.

At intra-day trading, Tower Semiconductor Ltd. (NASDAQ:TSEM)  jumped to its highest price of $166.44 before paring gains to finish the session just up by 16.99 percent at $166.08 apiece. The last time the stock touched the said level was in July 2001.

In a statement, Tower Semiconductor Ltd. (NASDAQ:TSEM) said that it partnered with Oriole Networks to deliver ultra-low, deterministic-latency networking for scale-up and scale-out AI architectures, built on Tower’s mature silicon photonics platform.

“As AI models continue to scale, requiring increasingly large clusters of processors, achieving high-radix networks with massive bandwidth and low latency becomes increasingly challenging. Leveraging Tower’s advanced silicon photonics platform, Oriole’s edge-switching architecture enables nanosecond optical circuit switching and a passive network core designed to deliver low and predictable tail latency with improved resiliency,” they said.

Ed Preisler, general manager of Tower Semiconductor Ltd.’s (NASDAQ:TSEM) RF Business Unit, said that the company’s partnership with Oriole “is a key step toward bringing AI back-end networking to market that can scale clusters and break through today’s latency wall.”

1. AXT Inc. (NASDAQ:AXTI)

AXT soared to a new all-time high on Thursday, as investors began positioning portfolios before the end of the first quarter of the year, backed by the company’s earlier upbeat outlook for the period, thanks to progress on its export permits.

At intra-day trading, AXT Inc. (NASDAQ:AXTI) climbed to its highest price of $58.13 before trimming a few cents to end the session just up by 19.13 percent at $58.09 apiece.

Earlier this year, AXT Inc. (NASDAQ:AXTI) posted an optimistic outlook for the first quarter of 2026, saying that it expects to achieve sequential revenue growth amid demand growth in indium phosphide for the AI infrastructure build-out, supported by its progress in export permits, which were lacking in the fourth quarter of 2025.

Indium phosphide is a high-performance semiconductor primarily used for high-speed electronics, optoelectronics, and photonics, and is crucial for various industries, including fiber optic communications, mobile networks, automotive lidars, and laser technologies, among others.

“We are notably broadening our customer base to include Tier-1 companies to which we have previously had limited exposure. We are also on track to double our indium phosphide manufacturing capacity this year and have a strong balance sheet to support our continued business expansion,” said AXT Inc. (NASDAQ:AXTI) CEO Morris Young earlier.

While we acknowledge the potential of AXTI to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than AXTI and that has 100x upside potential, check out our report about the cheapest AI stock.

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