US stock market: Tech rally boosts Wall Street; Nvidia shares lead with 12.8% gain

Big technology stocks bounced back on Wednesday, propelling U.S. indexes higher as Wall Street became increasingly convinced that long-anticipated cuts to interest rates would arrive soon.

The S&P 500 surged 1.6 per cent, or 85.86 points, to 5,522.30, marking its best day since February. The Dow Jones Industrial Average rose 99 points, or 0.2 per cent, to 40,842.79, and the Nasdaq composite soared 2.6 per cent, or 451.98 points, to 17,599.40.

The broad-based gains were accompanied by easing Treasury yields in the bond market, following the Federal Reserve’s clearest indication yet that interest rates could be lowered in September.

Market movers

Semiconductor shares enjoyed a buoyant session, with artificial intelligence player Nvidia rocketing up 12.8 per cent. Broadcom and Micron also advanced.

Match Group jumped 13.2 per cent after reporting stabilising user trends for Tinder and results that roughly matched analysts’ expectations for the latest quarter.

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Advanced Micro Devices rallied 4.4 per cent after reporting better-than-expected profit and revenue for the latest quarter.

Meta Platforms rose 2.5 per cent, while Amazon and Apple each gained at least 1.5 per cent.
Microsoft fell 1.1 per cent despite reporting profit and revenue that edged past analysts’ expectations for the latest quarter.

Performance of Big Tech stocks is significant due to their status as Wall Street’s most valuable companies, giving them substantial influence on the S&P 500. This elite group of stocks, dubbed the “Magnificent Seven,” has driven the U.S. stock market to multiple records this year.

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Altria Group stocks fell 3 per cent after the maker of cigarettes and smoke-free products missed expectations for profit and revenue in its latest quarter.

Bond market dynamics

In the bond market, the yield on the 10-year Treasury eased to 4.05 per cent from 4.14 per cent late Tuesday. It has been declining from 4.70 per cent in April as a slowdown in inflation raised expectations for impending interest rate cuts.

With inputs from AP