S&P 500 Gains 98 Points as Chip Stocks Revive the AI Trade

The S&P 500 climbed 98.45 points, or 1.31%, to 7,619.38 on Wednesday as artificial intelligence stocks bounced back from last week’s rout.

The Nasdaq Composite gained 400.31 points, or 1.6%, to 25,466.19, and the Dow Jones Industrial Average added 254.60 points, or 0.49%, to 52,486.49, Reuters reported.

The spark was CoreWeave, the debt-heavy AI cloud company, whose shares surged 24.7% after its quarterly results. It was the stock’s biggest one-day percentage gain in more than three months.

CoreWeave told investors it expects to turn profitable on an adjusted basis in the first half of 2028, an effort to show that customer commitments can support its borrowing-fueled expansion.

The relief spread across the AI build-out. Nebius Group jumped 15.4%, and the Philadelphia Semiconductor index rose 5.7% to its highest close since Nov. 3, with every company in the index finishing higher.

Memory maker Micron rallied 11.9% to $811.30, Dell gained 11.8% and Seagate added nearly 10%, according to Investing.com. Nvidia rose 2.9% to $173.73 after two days of steep losses.

Those two sessions had wiped about $430 billion off Nvidia’s market value as investors worried about CEO Jensen Huang’s relationship with a businesswoman alleged to be a Chinese spy.

Not Every Big Name Joined In

The rally was not universal. Microsoft fell 2.3% to $521.13, Amazon lost 1.7% and McDonald’s dropped 2.6%, and Meta also finished lower, InvestingLive reported.

The gains left the S&P 500 within 2.6% of the all-time high it set last month and close to recovering all of last week’s AI-driven sell-off, the Associated Press reported.

Volatility has been the rule. Thomas Martin, senior portfolio manager at Globalt in Atlanta, told Reuters that “everybody’s looking for a canary in a coal mine every single day.”

“What we’ve seen is that you’ve gone back and forth, back and forth, back and forth between AI is good, AI is not so good,” Martin said. “We’re worried about it, then oh, it’s great.”

Investors have also been weighing the prospect of more AI regulation after sweeping Democratic wins in last week’s midterm elections, along with cooling oil prices and hotter inflation.

Tuesday’s consumer price report cemented expectations that the Federal Reserve will raise interest rates in December.

Traders are fully pricing in a quarter-point hike and see about a 10% chance of a half-point move, according to CME FedWatch data cited by Reuters.

The CBOE Volatility Index, Wall Street’s fear gauge, fell for a fourth straight session to 17.49, a one-week low. Trading was light, with 14.74 billion shares changing hands against a 20-day average of 18.68 billion.

The Treasury market was closed for Veterans Day, so bond traders will get their first look at the stock rebound on Thursday.

Investors are also sizing up Anthropic’s planned initial public offering, which aims for a valuation of up to $1.4 trillion and could draw record buying from individual investors, Vanda Research said in a note.

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