HISTORY: U.S. stocks closed higher on Wednesday, thanks to a rebound in technology stocks and despite inflation data that dampened investor sentiment earlier in the session.
The Dow gained three-tenths of a percent, the S&P 500 climbed one percent and the Nasdaq gained more than two percent.
All three indices opened lower after the Labor Department reported an expected increase in the consumer price index in August.
But the core CPI, which strips out the volatile components of food and energy, rose slightly more than expected, effectively confirming the Federal Reserve’s quarter-percentage-point interest rate cut this month – and likely dashing hopes for a deeper half-percentage-point cut.
Among the stocks that rose was Nvidia, which rose 8%, helped by a report from Semafor that the U.S. government is considering allowing Nvidia to export advanced chips to Saudi Arabia.
Meanwhile, Nvidia CEO Jensen Huang spoke at a Goldman Sachs conference on Wednesday and spoke of enormous demand for the AI darling’s next-generation Blackwell chip.
Melissa Otto is head of technology, media and telecommunications research at S&P Global Visible Alpha.
“When I look at Visible Alpha’s consensus data for the fourth quarter, Nvidia is expected to have revenue of $2.5 billion.
But next year, that number is expected to rise significantly to around $55 billion. So it will be really interesting to see what the company forecasts for the fourth quarter and how it comments on that outlook. Because that will tell us a lot about the future development of AI.”
GameStop shares fell nearly 12% after the video game retailer announced it would file an offering of up to 20 million shares and reported a decline in second-quarter sales.
The previous evening’s debate between Kamala Harris and Donald Trump also played a role in the market.
Stocks expected to perform well under a Trump presidency posted losses. These included cryptocurrency and blockchain-related stocks, as well as the former president’s Trump Media & Technology Group, which fell 10.5 percent.
Meanwhile, solar stocks, which are likely to benefit from a Harris administration, recovered: First Solar rose 15 percent and Sunrun rose over 11 percent.
