NEW YORK (AP) — The U.S. stock market is rising Wednesday following strong profit reports from SpaceX, Capital One Financial and other big companies.
The S&P 500 added 0.4% and pulled within 1% of its all-time high set earlier this month. The Dow Jones Industrial Average was up 171 points, or 0.3%, with an hour remaining in trading, and the Nasdaq composite was 0.9% higher.
SpaceX helped lead the market and climbed 7.2% after reporting a stronger profit
for the summer than analysts expected. Elon Musk, who runs the company that makes money from artificial-intelligence technology, rockets and other businesses, also said that SpaceX took a step to consider a possible merger with Tesla, his electric-vehicle company.
Tesla rose 3.3% ahead of its own earnings report scheduled for late Wednesday and was one of the strongest forces lifting the S&P 500.
Other stocks rallying on profit reports that topped analysts’ expectations included Capital One Financial, which rose 2.7%, and Winnebago Industries, which climbed 7.8%.
Expectations are high for profit growth during the summer, and companies will need to meet them to justify the big runs their stock prices have made toward records despite worries about high inflation, higher interest rates and other challenges weighing on Wall Street.
Winnebago was able to report a more resilient profit than analysts expected even as high fuel prices and frustration among U.S. shoppers restrain interest in recreational vehicles, for example. CEO Michael Happe said its more expensive towable RVs are a tougher sell, but customers are interested in its “more accessible” offerings.
On the losing side of Wall Street was Netflix, which fell 4.9% even though the streaming service reported a stronger profit than analysts expected. Investors focused instead on worries that Netflix’s momentum may be slowing. The company’s forecast for revenue growth in the final three months of the year fell short of analysts’ expectations.
AT&T fell 5.7% even though it likewise delivered a stronger profit for the latest quarter than analysts expected. It gave a forecast for growth this year in an underlying measure of earnings before income taxes and some other things that fell short of some analysts’ expectations.
Among AI stocks, which have been at the center of the market’s action in recent weeks, the movements remained unsettled.
After leading the rest of the market for years because of the frenzy around AI, stocks in the industry have become shaky on worries that the build out of data centers may slow because of how much more expensive it’s become to borrow money.
CoreWeave, which has borrowed money to buy AI chips that it rents out to customers over the cloud, has been particularly volatile. It bounced between an early gain of nearly 4% and a drop of 4.5% Wednesday morning before moderating to a dip of 0.5%. A day earlier, it had careened between similarly wide gains and losses.
Other AI-linked stocks were more resilient. Nvidia's rise of 1.9% was the strongest force lifting the S&P 500.
Besides SpaceX’s profit report showing strength for AI spending, another encouraging signal for the industry came from Super Micro Computer, which sells AI servers and services. It said it expects to report stronger revenue for the summer than it had earlier forecast because of “increased demand for AI platforms,” and its stock rallied 8.5%.
In the bond market, the yield on the 10-year Treasury erased an early dip and rose to 5.14% from 5.12% late Tuesday.
It swung with oil prices, which remained unsteady on Wednesday. The price for a barrel of Brent crude drifted between $108 and $111 before settling at $108.82. Through October, it's been yo-yoing between $97 and $112 in October on uncertainty about when the war with Iran will allow the global energy industry to return to normal.
In stock markets abroad, indexes rose in Europe following a mixed finish in Asia. South Korea’s Kospi jumped 3.3% for one of the world’s biggest moves as AI stocks regained strength.
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AP Business Writers Michelle Chapman and Elaine Kurtenbach contributed to this report.
