U.S. stocks rose as upbeat earnings from AI infrastructure firms boosted technology stocks, while in-line inflation data reinforced investor bets that the Federal Reserve will hold interest rates steady at its September meeting.
U.S. equities advanced as strong corporate earnings reports from artificial intelligence infrastructure providers helped offset software sector losses, while inflation metrics gave central bank watchers room to breathe. According to preliminary figures, advancing issues outnumbered decliners on major exchanges as investors weighed the latest round of quarterly results against shifting economic indicators.
AI Infrastructure Surges on Upbeat Forecasts and Earnings
Technology shares led the broader market higher, propelled by strong quarterly numbers and bullish forward guidance across the artificial intelligence supply chain. The S&P 500 information technology sector jumped 1.2% to lead sector gains on the benchmark index. CoreWeave surged 19% after the cloud company lifted its annual capital spending forecast and topped second-quarter earnings estimates. Other sector participants saw sharp upward momentum, including data-center operators IREN and Applied Digital, which gained 7% and 3.4% respectively.
Server makers and neocloud providers also posted substantial advances. Nebius Group jumped 25% following its second-quarter report, while Super Micro Computer climbed 15% after forecasting fiscal 2027 revenue above Wall Street expectations. Chipmakers joined the rally as Nvidia added 2.6% and Micron Technology rose 6.4%, driving the broader semiconductor index up about 3.1%.
“(AI trades) have more to run for good reason. There’s tremendous funding ahead and revenue scale for many… there’s further legs ahead. The demand for compute is at record highs.”
Eric Schiffer, chairman of The Patriarch Organization
Schiffer added that market participants can expect continued capital deployment into the sector. You're going to see continued signs and signals and deals and funding related to AI and AI has been powering this market,
he noted.
Inflation Data and Federal Reserve Rate Expectations
Beyond the technology sector, investors parsed fresh consumer price data to gauge the near-term trajectory of monetary policy. U.S. consumer prices increased as expected in July, a reading that market participants interpreted as supportive of a pause in interest rate hikes.
Traders adjusted their positions following the release. CME’s FedWatch Tool priced in a 62% probability that the central bank will keep rates holding at its September meeting. Prior to the data publication, market expectations had been evenly split between a rate hike and an unchanged stance.
Economic figures have faced heightened scrutiny amid fluctuating energy prices driven by Middle East tensions.
Broader Market Performance Across Major Averages
Market action varied across major benchmarks as strong corporate results contended with isolated profit warnings. The S&P 500 rose 14.39 points, or 0.19%, to 7,742.59, while the tech-heavy Nasdaq Composite gained 102.48 points, or 0.39%, to settle at 26,547.92, bringing it within 2.2% of a record high. The Dow Jones Industrial Average ticked up 9.21 points, or 0.02%, to 53,801.06. Meanwhile, separate market reporting from Dow Jones & Company cited preliminary data showing 1,617 advancing issues against 1,090 declining issues on the New York Stock Exchange.
Wall Street’s volatility gauge, the CBOE Volatility Index, briefly touched a seven-month low before trading down 0.49 points at 14.79. Additional corporate standouts included Cava Group, which advanced 13.3% after beating second-quarter sales and core profit expectations, and Lumentum Holdings, which added 15% following a strong revenue forecast for the first quarter.
Geopolitical Headwinds and Upcoming Economic Milestones
Despite positive momentum in equities, broader macro uncertainties persist. International shipping disruptions and stalled diplomatic efforts in the Middle East continue to cast a shadow over supply chains and energy markets. A senior Iranian source indicated that talks to revive the interim agreement struck in June and establish an implementation timeline had yielded no progress.
With another round of inflation figures scheduled for release ahead of the September Federal Open Market Committee meeting, market participants remain alert to potential shifts in the economic landscape.
