The S&P 500 and the Nasdaq ended higher on Wednesday, lifted by upbeat quarterly results from CoreWeave and other AI infrastructure firms, while mild inflation data reinforced bets that the U.S. Federal Reserve will hold interest rates steady in September.
U.S. consumer prices barely increased in July as the cost of gasoline declined for a second straight month, while underlying inflation was benign, further reducing expectations of an interest rate hike from the Federal Reserve next month.
"The numbers came in right in line. The market's reaction is slightly positive because the market was fearful it was going to come in worse than it did. You're seeing a market thinking that the Fed is not being pushed toward a rate hike," said Robert Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Connecticut.
CoreWeave CRWV.O surged 19% after the AI cloud company lifted its annual capital spending forecast and topped second-quarter earnings estimates.
Data center operators also rose, with IREN IREN.O gaining almost 10% and Applied Digital APLD.O up 4.9%. Data center company Nebius Group NBIS.O jumped 34%, helped by second-quarter results that beat expectations.
Super Micro ComputerSMCI.O surged 19% after the AI server maker forecast fiscal 2027 revenue above Wall Street expectations.
Chipmakers gained, with Nvidia NVDA.O rising 3% and Micron Technology MU.O adding 4.9%. The PHLX Semiconductor Index .SOX advanced about 2.5%. It remains down about 15% from its record-high close on June 22.
The S&P 500 climbed 0.26% to end the session at 7,748.50 points. The benchmark is up about 13% so far in 2026.
The Nasdaq gained 0.54% to 26,588.49 points for the session, while the Dow Jones Industrial Average declined 0.04% to 53,770.27 points.
Eight of the 11 S&P 500 sector indexes rose, led by real estate .SPLRCR, up 1.08%, followed by a 1.06% gain in information technology .SPLRCT.
Wall Street's fear gauge, the Cboe Volatility Index .VIX, dipped 0.8 point to 14.45, its lowest level since January.
Traders are now pricing in a 62% chance of the Fed holding rates at its September meeting, according to CME's FedWatch Tool. Before the July inflation data was released, bets were split between a hike and no change.
The conflict between the U.S. and Iran remained volatile as a senior Iranian source said there had been no progress in talks to revive the interim deal reached in June and define a time frame to implement it, while shipping attacks continued.
Cava Group CAVA.N advanced 14.2% after the restaurant chain beat Wall Street expectations for second-quarter sales and core profit.
Lumentum Holdings LITE.O surged 13.6% after the photonic product maker forecast first-quarter revenue above analysts' expectations and beat fourth-quarter estimates.
Across the U.S. stock market .AD.US, advancing stocks outnumbered falling ones by a 1.7-to-one ratio.
The S&P 500 posted 19 new highs and 2 new lows; the Nasdaq recorded 123 new highs and 95 new lows.
Volume on U.S. exchanges was relatively light, with 15.5 billion shares traded, compared with an average of 17.5 billion shares over the previous 20 sessions.
Reuters
