U.S. equities saw notable sector rotations on Wednesday, with defense stocks climbing to record levels while data storage and solar names pulled back sharply.

Gainers:

• Defense: The iShares U.S. Aerospace & Defense ETF (ITA) rose nearly 1% to a new all-time high amid rising geopolitical tensions. Component stocks AAR, L3Harris, and Karman Holdings advanced between 2% and 4%.

  

• Biotech: Amgen gained over 3% after announcing the $840 million acquisition of U.K.-based biotech Dark Blue Therapeutics.

• Pharma: Ventyx Biosciences skyrocketed 38% following a Wall Street Journal report that Eli Lilly is in talks to acquire the firm for approximately $1 billion.

• Bitcoin: Strategy, a bitcoin treasury firm, rose more than 3% after index provider MSCI reversed its plan to remove digital asset companies from its indexes.

• Lithium: Albemarle climbed over 3% after an upgrade from Baird, which cited surging lithium prices and strong demand from the stationary storage market.

Decliners:

• Data Storage: Stocks in the sector retreated sharply following Tuesday's explosive rally. Western Digital fell more than 9%, Seagate tumbled about 8%, and Sandisk slipped over 1%.

• Solar: First Solar plunged nearly 10% after Jefferies downgraded the stock to hold, citing questionable strategic decisions and limited booking visibility.

• Apparel: Deckers Outdoor, the maker of UGG and Hoka, dropped more than 3% following downgrades from analysts at Robert W. Baird and Piper Sandler.

• Special Situations: GameStop rose 4% after disclosing a new CEO compensation package tied to ambitious growth targets.