US Stocks Climb Near Record as Earnings Revive Faith in AI Trade

Nasdaq signage during the Latigo Biotherapeutics Inc. initial public offering (IPO) at the Nasdaq MarketSite in New York, US, on Friday, Aug. 7, 2026. Latigo Biotherapeutics Inc., a clinical-stage developer of non-opioid pain medicines, climbed 17% on Friday after raising $345.6 million in an upsized initial public offering, priced at the top of a marketed range. Photo by Michael Nagle /Bloomberg

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(Bloomberg) — US stocks advanced toward all-time highs, led by the technology sector, after a subdued inflation reading helped ease interest-rate hike concerns. 

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The S&P 500 rose 0.4% as of 2:38 p.m. in New York. The technology-heavy Nasdaq 100 gained 0.9%, reversing losses from earlier in the week. Cboe Volatility Index, which measures the expected volatility of the S&P 500 over the next 30 days, fell its lowest level since January, as investors anticipate a stable market for the foreseeable future and are buying very little insurance against a crash. 

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Helping lift stocks are results from Coreweave Inc., a bellwether for the data center boom, and Nebius Group NV that affirmed confidence in the AI trade. Shares of Nebius gained nearly 29% while Coreweave rose 20%.

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“The laggards on the day are mainly check-writing hyperscalers and metals/mining names, as copper prices are taking a breather after a strong run,” said Sameer Samana, head of global equities and real assets. at the Wells Fargo Investment Institute. 

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“The real economy remains on solid footing (albeit with inflation that will remain stickier/higher), with a turbo boost from AI-related capex/buildout which is feeding into a strong corporate earnings outlook that will drive further gains in equities,” Samana said.

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US CPI data released just ahead of the bell showed July consumer prices rose in line with expectations, while a key metric matched the slowest pace since March 2021. 

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The CPI reading and a cooler-than-expected jobs report “may keep hawkish Fed officials at bay in September,” said Gary Schlossberg, global strategist at Wells Fargo Investment Institute. “However, we remain guarded on the near-term outlook for inflation amid volatile oil prices tied to the ongoing Middle East conflict along with lingering core price pressures from a strong economy and the AI boom.”

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PPI data, to be released Thursday, will allow markets to “get a better gauge of how this all passes into core PCE, the Fed’s preferred inflation measure,” said Molly Brooks, an analyst at TD Cowen. “Overall, the print is supportive of a Fed hold, but we are not out of the woods on a hike as the Fed does not need much to tip them over the edge towards raising rates.” 

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Market pricing of a Federal Reserve rate hike swung around 40%, after sitting at a 50-50 toss-up ahead of the print.  

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Brent crude remained steady at $89 per barrel. “The stalled conflict in the Middle East is also having little impact on the day, as viewed through the lens of flattish energy prices but it remains a possible negative asymmetric risk for markets,” Wells Fargo’s Samana said.

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In single stock moves, shares of Wendy’s Co. jumped to their highest level in seven weeks after the Financial Times reported that Trian Fund Management is preparing a bid to take the struggling fast-food chain private, citing people familiar with the matter.

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ESPN reported that The Los Angeles Lakers were purchased for over $12 billion by Josh Kushner and Bob Iger. The sale indicates that MSG Sports’ teams may be undervalued in public markets, notes Bloomberg Intelligence analyst Kevin Near. MSG shares have climbed to record levels ahead of the anticipated separation of the Knicks and Rangers, and amid enthusiasm over the Knicks’ 2026 championship.