The S&P 500 rose again on Thursday, near record levels, as AI-linked stocks kept powering the rally, while softer inflation data lowered Treasury yields and the odds of a September rate hike. Cisco's post-earnings selloff tempered the mood.
AI names drive the S&P 500 higher
The S&P 500 closed at 7,748.50, up 0.26%, while the Nasdaq gained 0.54% to 26,588.49. The Dow slipped 0.04%.
AI infrastructure names did the heavy lifting. CoreWeave rose about 19%. Super Micro gained roughly 19% as well. Nebius jumped about 34%. Nvidia added about 3%, and Micron climbed 4.9%.
Cooler inflation lifts sentiment
July CPI rose just 0.1% from the previous month, and annual inflation slowed to 3.4% from 3.5%. As a result, markets now see roughly a 40% chance of a September Fed rate hike, down from about 54% a week earlier. That shift matters for growth stocks, since a lower rate hike probability tends to ease pressure on future earnings.
The 10-year Treasury yield sits around 4.68%, down slightly from Wednesday. Lower yields typically give technology shares more breathing room, while a sharp rise can push investors toward safer, interest-paying alternatives.
Cisco's selloff shows high expectations bite
Cisco shares still fell more than 4% after hours. The company said AI infrastructure orders from large cloud customers reached $4 billion during the quarter. Cisco had already risen more than 60% this year, so the market judged the results against very high expectations rather than against the numbers alone.
Cerebras shares fell about 16% after hours after revenue missed forecasts, even though the company raised its full-year outlook.
Oil keeps the risk backdrop alive
Today's U.S. producer price report is the next test for the inflation narrative, and Brent crude trades near $87.95 while WTI holds around $82.19 as weaker demand expectations and rising U.S. crude inventories weigh on prices. The unresolved dispute around the Strait of Hormuz remains a risk that could send oil, and inflation expectations, sharply higher again.
With the index near record levels, traders are watching whether Cisco's post-earnings drop spreads to other chip stocks or fades as an isolated reaction.
Source: Investinglive.com
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