U.S. stocks moved slightly higher on Wednesday after July inflation came in mostly as expected, easing concerns that the Federal Reserve will need to raise interest rates at its September meeting. The Nasdaq Composite led the advance with a gain of roughly 0.6%, while the S&P 500 rose about 0.3% and the Dow Jones Industrial Average hovered near the flat line.
The relatively calm reaction followed several volatile sessions driven by Middle East tensions and shifting expectations for monetary policy. Investors welcomed signs that consumer price pressures are cooling, while another wave of strong AI infrastructure earnings helped support technology stocks despite lingering concerns over elevated spending and valuations.
Market Movers:
- CoreWeave (CRWV) +20%: Shares surged after the AI cloud infrastructure company reported second-quarter results broadly in line with expectations while revenue nearly doubled year over year and backlog climbed to roughly $104 billion. Management said the company has reached an important inflection point as rapidly expanding scale begins translating into stronger operating leverage and broader enterprise adoption.
- Nebius (NBIS) +15%: Shares soared after the AI infrastructure provider reported revenue growth of 454% year over year and reaffirmed its full-year outlook. AI cloud revenue jumped 514% to $575 million, while management maintained ambitious annualized revenue and margin targets despite continued heavy capital spending.
- Super Micro Computer (SMCI) +13%: Shares rallied after the AI server maker issued fiscal first-quarter guidance well above Wall Street expectations following a broadly in-line fourth quarter. Supermicro also highlighted more than $60 billion in new orders and a record backlog, reinforcing expectations for continued AI server demand into fiscal 2027.
- CAVA Group (CAVA) +12%: Shares advanced after the fast-casual restaurant chain topped expectations for comparable sales and adjusted EBITDA while maintaining its full-year forecast. Same-restaurant sales rose 9%, supported by 5.3% traffic growth, while revenue climbed more than 31% year over year.
- Lumentum Holdings (LITE) +6%: Shares gained after the optical networking company posted stronger-than-expected fiscal fourth-quarter results and issued an upbeat first-quarter outlook. Revenue more than doubled from a year earlier as AI-driven demand for optical connectivity, CPO lasers, and external laser source modules accelerated.
- United States Antimony (UAMY) -21%: Shares plunged after the critical-minerals producer reported a sharp revenue decline and slashed its full-year sales outlook. The company now expects 2026 revenue of $60 million to $75 million, well below its prior $125 million forecast and Wall Street expectations.
- Beta Technologies (BETA) -7%: Shares declined after the electric aircraft developer posted a wider-than-expected loss despite beating revenue estimates and raising its full-year sales forecast. Heavy spending on aircraft development, certification, and technology pushed operating expenses sharply higher and widened its adjusted EBITDA loss.
- NuScale Power (SMR) -5%: Shares fell after the small modular reactor developer filed for an at-the-market stock offering of up to $750 million. The potential equity issuance revived dilution concerns as the pre-commercial company continues funding development while generating significant negative free cash flow.
Cooling CPI Eases Pressure on the Fed
The Consumer Price Index showed inflation eased to a 3.4% annual rate in July from 3.5% in June, matching economists' expectations. Prices rose just 0.1% month over month, giving investors another sign that inflation may be gradually moving in the right direction. The report follows July's surprisingly weak jobs data, which showed the U.S. economy lost 23,000 positions. Together, the softer labor market and moderating inflation strengthened the argument for the Fed to keep rates unchanged in September rather than deliver another hike. Inflation nevertheless remains well above the Fed's 2% target, meaning policymakers are unlikely to declare victory. Investors will continue watching incoming data closely for evidence that July's moderation can persist.
AI Infrastructure Earnings Restore Some Confidence
Technology shares received additional support from a strong batch of AI infrastructure results. CoreWeave, Nebius, Supermicro, and Lumentum all delivered evidence that demand for AI computing, servers, and optical networking remains robust. The results arrive at an important moment for the AI trade. Investors have become increasingly skeptical of the enormous capital expenditures required to build data centers and deploy advanced computing infrastructure, making revenue growth, backlog visibility, and improving margins increasingly important. Wednesday's reports offered some reassurance that demand has not disappeared, though the scale of ongoing investment means companies will still need to demonstrate that growth can ultimately translate into durable profitability.
Strait of Hormuz Keeps Energy Risk High
Geopolitical uncertainty remains a key risk even as inflation showed signs of cooling. The U.S. and Iran remain deadlocked over the Strait of Hormuz, while shipping volumes through the critical energy corridor remain far below pre-conflict levels. Brent crude moved close to $90 per barrel amid continued disruption and uncertainty surrounding negotiations. Persistently high energy prices could complicate the inflation picture in coming months and remain one of the biggest threats to the Fed's ability to keep rates on hold.
Looking Ahead
Investors will now turn to additional inflation readings, Fed commentary, and the remaining slate of corporate earnings for clues on whether Wednesday's calmer market tone can continue. Another stretch of moderating price data would further strengthen the case for a September pause, particularly after July's weak employment report. At the same time, AI spending and Middle East developments remain major wild cards. Strong infrastructure demand could keep supporting technology stocks, but a renewed surge in oil prices or signs that inflation is reaccelerating could quickly bring rate-hike fears back into focus.