NEW YORK: The tech-heavy Nasdaq led gains on Wednesday after quarterly results from SpaceX and Super Micro Computer improved appetite for AI-linked stocks, while Netflix slipped as its forecast failed to impress investors.
Elon Musk’s rocket and space technology firm rose 9.8 percent after he said on Tuesday that a merger of SpaceX and Tesla would be “a good idea”. SpaceX also posted its first profit as a public company. Tesla shares were up 3.5 percent.
Super Micro jumped 10.3 percent to the top of the S&P 500 after the AI server maker forecast quarterly revenue and profit margin above Wall Street estimates, signaling that AI demand remained resilient.
Peers HPE and Dell rose 2.2 percent and 4.5 percent, respectively.
Investors drew comfort from the reports as concerns over the profitability of the AI buildout triggered a selloff in AI-linked stocks last week, with data center operator CoreWeave at the center of the storm. Its shares were marginally down, suggesting lingering caution in the sector.
“The sentiment around tech has shifted … There’s a lot of stress in the credit markets right now that is keeping a lid on breakouts in tech,” said Mark Hackett, chief market strategist for Nationwide.
“Most people are just going to wait and see the whites of the eyes of that (next week’s tech) earnings because the skepticism is very high right now, both in terms of sustainability of the buildout and the quality of the companies themselves.”
At 11:36 a.m. ET, the Dow Jones Industrial Average rose 132.16 points, or 0.25 percent, to 52,628.04, the S&P 500 gained 35.56 points, or 0.46 percent, to 7,748.13 and the Nasdaq Composite gained 276.30 points, or 1.05 percent, to 26,701.12.
The S&P 500 information technology sector rose 1.3 percent, lifting the benchmark index, as most chip stocks rebounded.
The Philadelphia SE Semiconductor index was up 1.3 percent. The index has had a volatile month so far, during which it declined for eight consecutive sessions, marking its longest losing streak in 18 years.
The overall rise on the S&P 500 was contained by a 1.2 percent drop in communication services stocks, dragged down by a 6.3 percent slide in telecom operator AT&T despite beating third-quarter revenue and profit estimates.
Netflix slipped 1.8 percent after the streaming giant issued a weaker-than-expected forecast for its fourth-quarter profit. Google parent Alphabet also lost 1.9 percent.
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