(Feb 25): US stocks gained on Wednesday as Nvidia Corp, the top-weighted S&P 500 Index stock, climbed ahead of the chipmaker’s earnings report after the market close.
The S&P 500 Index rose 0.6% at 9.54am in New York, with five of 11 sectors in the green, led by shares of technology, communications and financial companies. The Nasdaq 100 Index added 1.2%.
Shares of Nvidia, a benchmark for the artificial-intelligence trade, rose 1%. The company accounts for nearly 8% of the S&P 500, and its results come as investors are increasingly nervous about the outlook for AI and its disruptive potential across industries including finance and software.
“The next compelling move in the stock market will be decided by tonight’s earnings/guidance from Nvidia,” Matthew Maley, chief market strategist at Miller Tabak + Co, wrote in a note. “It remains the most important stock…in the most important leadership group…in the stock market.”
Software stocks have been particularly vulnerable to AI jitters recently. Workday Inc’s disappointing results on Tuesday evening added to that concern. The company’s shares tumbled 4.1% after it gave an outlook for quarterly subscription sales that fell short of estimates. Also after the close, investors will get earnings from software companies Salesforce Inc and Snowflake Inc.
Axon Enterprise Inc jumped after profits at the maker of Tasers and public-safety software beat estimates. Analysts see Axon as an AI winner rather than a company at risk of disruption. Decliners after disappointing earnings included GoDaddy Inc, First Solar Inc, Lowe’s Cos Inc and HP Inc, which warned that higher memory prices were weighing on its outlook.
See also: Tech stocks power gains after AI-fuelled sell-off
In other corporate news, Netflix Inc advanced 4.6% after Warner Bros Discovery Inc said a new US$31 ($39.20)-a-share buyout offer from Paramount Skydance Corp could lead to a better deal than its existing agreement with Netflix.
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