By Noel Randewich and Purvi Agarwal
Aug 12 (Reuters) - The S&P 500 and the Nasdaq rose on Wednesday, lifted by upbeat quarterly results from CoreWeave and other AI infrastructure firms, while mild inflation
data reinforced bets that the U.S. Federal Reserve will hold interest rates steady in September.
U.S. consumer prices barely increased in July as the cost of gasoline declined for a second straight month, while underlying inflation was benign, further reducing expectations of an interest rate hike from the Federal Reserve next month.
"The numbers came in right in line. The market's reaction is slightly positive because the market was fearful it was going to come in worse than it did. You're seeing a market thinking that the Fed is not being pushed toward a rate hike," said Robert Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Connecticut.
CoreWeave surged 19% after the AI cloud company lifted its annual capital spending forecast and topped second-quarter earnings estimates.
Data center operators also rose, with IREN gaining 8.6% and Applied Digital up 3.8%. Data center company Nebius Group jumped 28%, helped by second-quarter results that beat expectations.
Super Micro Computer surged 18% after the AI server maker forecast fiscal 2027 revenue above Wall Street expectations.
Chipmakers gained, with Nvidia rising 3% and Micron Technology adding 7%. The PHLX Semiconductor Index advanced about 3.4% and was on track for its biggest one-day jump in more than a week.
The S&P 500 was up 0.29% at 7,750.89 points.
The Nasdaq gained 0.57% to 26,597.22 points, while the Dow Jones Industrial Average was up 0.03% at 53,808.15 points.
Lifted by upbeat quarterly earnings reports, the S&P 500 notched a record-high close on Friday, and it is up about 13% so far in 2026.
Eight of the 11 S&P 500 sector indexes rose, led by information technology, up 1.18%, followed by a 0.98% gain in real estate.
Wall Street's fear gauge, the CBOE Volatility Index, briefly touched a seven-month low and was last down 0.68 point at 14.60.
Traders are now pricing in a 62% chance of the Fed holding rates at its September meeting, according to CME's FedWatch Tool. Before the July inflation data was released, bets were split between a hike and no change.
The conflict between the U.S. and Iran remained volatile as a senior Iranian source said there had been no progress in talks to revive the interim deal reached in June and define a time frame to implement it, while shipping attacks continued.
Cava Group advanced 13% after the restaurant chain beat Wall Street expectations for second-quarter sales and core profit.
Lumentum Holdings surged 17% after the photonic product maker forecast first-quarter revenue above analysts' expectations and beat fourth-quarter estimates.
The S&P 500 posted 15 new highs and 2 new lows; the Nasdaq recorded 95 new highs and 86 new lows.
(Reporting by Noel Randewich in San Francisco; Additional reporting by Avinash P and Purvi Agarwal in Bengaluru and Sinead Carew in New York; Editing by Pooja Desai and Matthew Lewis)
