On today's episode of Market Domination Overtime, Hosts Julie Hyman and Josh Lipton analyze the market close and report on Micron's (MU) latest earnings.

The Dow Jones Industrial Average (^DJI) and the S&P 500 (^GSPC) have pulled back from their all-time highs, with the Dow snapping its four-day winning streak. Citi US equity strategist Drew Pettit believes the Federal Reserve's interest rate cut is behind the most recent market action. He explains, "I think the Fed, and honestly heading into the Fed decision, interest rates across the curve coming down gave people more confidence to look through some potential softness in the labor market, maybe a little bit of softness in earnings macro data, even the housing data today, out the other side to say, 'Hey, the Fed isn't going to be as far behind the curve. That's OK. I can start positioning for the recovery.' And we've seen not just the secular stories work, but we've seen some of the cyclical stories start to work, at least since the mid-July interim peak."

Micron (MU) reported fiscal fourth quarter results that topped estimates on both the top and bottom lines. The stock soared in after-hours trading after the chip giant forecasted better-than-expected Q1 results.

Dan Morgan, Synovus Trust senior portfolio manager, tells Yahoo Finance, "It does appear that they are beginning to see a real good benefit from HBM, which, of course, is the high bandwidth memory that's used with the AI chip. So we're coming out of a down cycle. We've had a couple of good quarters. Now we're getting this AI top over the numbers, and it looks like they did gain from that."

Looking across Micron's segments, Morgan highlights how important memory driven by AI chip demand supported the earnings beat. "Smartphones and PCs aren't doing that great," the analyst says. "They're just starting to get out of the hole, and you have other applications, industrial auto, and so forth. And you're right. If you look at DRAM pricing in terms of spot pricing, it's just kind of leveled out...[Micron's] main markets, which are across the board, there's flash memory and there's DRAM chips. Just about everything is still kind of muted, right? It's still trying to get going. So if you were to take out this AI component, the data server space, we probably wouldn't be talking about it because it's just kind of just slowly unthawing."

Finally, Julie Hyman and Josh Lipton break down what to watch on Thursday, September 26, from Costco (COST) earnings to fresh pending home sales data.

This post was written by Melanie Riehl