Markets
US stocks rebound as CoreWeave results revive AI trade; Nasdaq gains about 1.7%
Chip and AI-infrastructure shares led a broad rally on Wednesday, with the VIX falling more than 10% while the bond market stayed shut for Veterans Day.
HedgeWeekly News Desk ·
US stocks climbed on Wednesday as an upbeat earnings report from CoreWeave eased concerns about how AI data centres are funded. At about 3:24 pm ET, the Nasdaq Composite stood at 25,487.80, up 1.68%, the S&P 500 was near 7,622.65, up about 1.35%, and the Dow Jones Industrial Average was at 52,476.78, up 0.47%. The Russell 2000 gained about 0.9%.
CoreWeave rose 22.49% to $59.69 after the company raised its revenue outlook and reported roughly $9 billion in expected customer prepayments. Power-equipment supplier Bloom Energy gained about 16%, and chip names led the S&P 500 at midday, with 18 of the index's top 20 performers from the technology sector. Nvidia rose 3.47% to $174.66, its first gain after a two-day sell-off, though the stock remains down about 14% in November. Baird cut its rating on the shares to Neutral. The VIX volatility index fell 10.33% to 17.45.
The rebound followed a shaky start to the week. Tuesday's hotter-than-expected inflation report pushed the 10-year Treasury yield briefly above 5% and raised investor bets on a Fed rate rise next month. The US bond market was closed on Wednesday for Veterans Day, while equities traded normal hours. US crude was near $87 a barrel in the afternoon, down from above $100 before the midterm elections.
For funds and allocators, the rally came with Treasuries not trading, so equity buyers have not yet had to price Wednesday's gains against a bond market near 5%. Thursday is the first session with Treasuries open since the inflation data. Watch whether yields and December rate-hike pricing cap the AI-led rebound, and whether the VIX holds near 17 after Wednesday's drop.