US stocks broadly rose on Wednesday as Oracle’s (ORCL) blowout revenue forecast lifted AI hopes. Meanwhile, wholesale inflation unexpectedly declined last month, bolstering the case for the Federal Reserve to cut rates next week.
The S&P 500 (^GSPC) and the Nasdaq Composite (^IXIC) both climbed around 0.4%, on the heels of record closing highs. The Dow Jones Industrial Average (^DJI), which includes fewer tech stocks, fell 0.1%.
Oracle stunned Wall Street as its CEO said its cloud revenue will skyrocket thanks to a big jump in bookings from the “who’s who of AI.” Its shares jumped over 30% Wednesday despite a quarterly earnings miss amid optimism that the AI infrastructure build-out — seen as fueling stock gains — is finally picking up pace.
Elsewhere, a reading on wholesale inflation came in much cooler than expected, showing producer prices actually declined on a month-over-month basis vs. expectations for a 0.3% increase. Year over year, the Producer Price Index is up 2.6%, also lower than expectations for 3.3%. The data sets the stage for the consumer price index (CPI) release on Thursday, the last clue to price pressures before the Fed’s policy meeting next week.
Markets have been more focused on labor market data, however, to gauge the Fed’s next move. A revision to US job numbers on Tuesday confirmed weakness in that market, cementing conviction a September rate cut is coming and stoking a rally in stocks.
Governor Lisa Cook is likely to take part in that Fed rate decision next week, after a judge blocked President Trump from removing her amid allegations of mortgage fraud. Trump has targeted Cook push to recast the in pursuit of lower interest rates.
On the trade front, Trump has urged the EU to join the US in imposing new 100% tariffs on India and China, media reports said. The tariff hikes are meant to push Russia — President Putin in particular — to participate in talks on the Ukraine war. Tensions in the region are rising after NATO member Poland shot down Russian drones that entered its airspace.
Meanwhile, in corporate earnings, GameStop (GME) shares jumped after the company reported an over 20% rise in quarterly revenue.
LIVE 13 updates
Klarna IPO prices at $40 per share, valuing BNPL leader at $15 billion
Yahoo Finance’s Jake Conley reports:
Read the full story here.
Nasdaq, S&P 500 rise at the open
US stocks broadly rose on Wednesday, with the S&P 500 (^GSPC) and the Nasdaq Composite (^IXIC) jumping 0.4%, on the heels of record closing highs. The Dow Jones Industrial Average (^DJI), which includes fewer tech stocks, fell below the flatline.
The moves come after Oracle’s (ORCL) earnings report included a blowout revenue forecast that lifted confidence that the AI-fueled tech rally has more room to run. Shares in Oracle jumped more than 30% at the open.
Stock futures rise following PPI report, traders boost jumbo rate cut bets
Stock futures for the S&P 500, Dow Jones Industrial Average, and Nasdaq Composite lifted in premarket trading after wholesale inflation data cooled unexpectedly in August, boosting hopes for a rate cut in September.
Treasury yields slipped following the report, with the 10-year yield (^TNX) drifting to 4.07%.
As of 8:55 a.m. ET, traders were pricing in 100% odds that the Fed cuts interest rates in September. Odds of a 25 basis point cut were priced at 89.8%, while bets that the Fed would opt for a jumbo 50 basis point cut rose to 10.2% from 7% a day ago.
Wholesale inflation unexpectedly cools in August
Wholesale inflation unexpectedly declined in August, the Bureau of Labor Statistics reported on Wednesday.
The Producer Price Index (PPI), a measure that tracks the selling prices of US producers of goods and services, declined 0.1% on a monthly basis in August. Analysts surveyed by Bloomberg were expecting a 0.3% rise.
PPI inflation rose 2.6% on an annual basis in August, compared to expectations for a 3.3% increase. Last month’s report also surprised, showing wholesale inflation rose 3.3% on an annual basis in July.
The BLS said the decline was driven by a 0.2% month-over-month decrease in the cost of services, while the cost of goods edged up 0.1%.
Chewy stock falls on year-over-year profit decline
Shares of the online pet supplies retailer Chewy (CHWY) fell 9% on Wednesday morning after the company reported a $0.54 per share profit drop compared to the same quarter a year ago.
Chewy posted diluted earnings per share of $0.14, meeting Wall Street analyst estimates, according to S&P Global Market Intelligence.
But that earnings figure marked a significant decline from the $0.68 profit per share reported in the same quarter a year ago. The company said the decrease in earnings was due to share-based compensation expenses and related taxes.
In the second quarter, revenue increased 8.6% year over year to $3.1 billion, coming in above estimates of $3.08 billion. Chewy said it had 20.9 million active customers at the end of the quarter, and net sales per active customer grew 4.6% to reach $591 million.
Listen to the earnings call live here.
Gold has had a golden 2025. It might have a golden 2026 too.
The foundation of gold’s (GC=F) bullishness is defensiveness, not a world-changing technology or financial innovation, argues Yahoo Finance’s Hamza Shaban in today’s Morning Brief.
He reports:
Read more here.
Swedish fintech Klarna set for hotly anticipated NYSE debut
Swedish buy now, pay later lender Klarna (KLAR) is set to go public on the New York Stock Exchange on Wednesday after raising $1.37 billion in its initial public offering.
According to Bloomberg, the fintech company and its backers sold 34.3 million shares for $40 per share in the oversubscribed IPO, which gives the company a $15.1 billion valuation, based on the outstanding shares. This is a drop-off from its $45.6 billion valuation in 2021, led by an investment from Japan’s SoftBank Group, but an improvement from its $6.7 billion valuation in 2022 following a private funding round.
Klarna had halted its IPO plans earlier in the spring as tariff volatility rocked markets. However, Klarna is now kicking off a busy week for IPOs, with seven other companies, including the Winklevoss twins’ crypto exchange Gemini, in the lineup to make their public debuts this week.
Read more here.
Good morning. Here’s what’s happening today.
Premarket trending tickers: Nvidia, GameStop and Synopsys
Here’s a look at some of the top stocks trending in premarket trading:
Nvidia (NVDA) stock rose 2% before the bell on Wednesday, as investor hopes grew around AI-fueled reports from TSMC (TSM) and Oracle (ORCL).
GameStop (GME) stock rose 10% before the bell on Wednesday after reporting a nearly 22% rise in second-quarter revenue on Tuesday.
Synopsys (SNPS) missed Wall Street estimates for third-quarter revenue on Tuesday, hurt by weakness in its Design IP business, sending shares down 20% in premarket trading on Wednesday.
Trump urges EU to join US in new 100% tariffs on China, India to squeeze Russia
President Trump has urged the EU to impose 100% tariffs on India and China to raise pressure on Russia over the war in Ukraine, the Financial Times reported.
Trump made the appeal in a call with US and EU officials in Washington on Tuesday. A US official said Washington would match any tariffs the EU imposed, adding:
“We’re ready to go, ready to go right now, but we’re only going to do this if our European partners step up with us,” one US official said.
This contradicts Trump’s Truth Social post, where he said negotiations with India were “continuing” and will reach a “successful conclusion.”
Bloomberg reports:
Read more here.
Barclays lifts S&P 500 target for second time in three months
Barclays has raised its year-end target for the S&P 500 (^GSPC) to 6,450 from 6,050, citing stronger-than-expected corporate earnings, resilient US economic growth, and optimism around artificial intelligence.
Reuters reports:
Read more here.
Oracle stock jumps after blowout revenue forecast, despite earnings miss
Shares of Oracle (ORCL) surged almost 30% in premarket trading after it boosted its forecast for AI-fueled cloud revenue, citing a jump in its contract backlog.
The software giant now expects its Cloud Infrastructure sales to reach $144 billion by 2030 — a massive leap from its estimate of $18 billion for the current year.
“We’re all kind of in shock in a very, very good way,” Brad Zelnick, an analyst at Deutsche Bank, said during Oracle’s earnings conference call, per Bloomberg. “There’s no better evidence of a seismic shift happening in computing than these results that you just put up.”
Yahoo Finance’s Laura Bratton reports:
Read more here.
Robinhood announces plans for copy trading platform
Reuters reports:
Read more here.
