The S&P 500 and Dow Jones Industrial Average hit record intraday highs Tuesday, driven by gains in software and semiconductor stocks. According to Investor’s Business Daily (IBD), the Dow and S&P 500 both climbed 1.8%, while the Nasdaq composite rose 2.6% to move above its 50-day moving average, marking an 8.8% advance over four sessions.
SpaceX Reports First Public Earnings With 92% Revenue Jump
Space Exploration Technologies (SPCX), or SpaceX, reported its first set of earnings as a public company, showing a 92% increase in revenue. Despite the top-line growth, the company reported a loss of 9 cents per share, which IBD attributes to very high capital spending.
During the earnings call, Elon Musk projected that SpaceX revenue could reach $1 trillion by 2030, contingent on Starship overcoming key technical hurdles. The stock fell 10% in premarket trading following the report, though it had previously rallied 9.4% to $125.33 on Tuesday.
Pro Tip: Watch the IPO lockup expiration on Thursday.
AI Hardware Divergence: Arista Networks vs. AMD
Results from AI-centric hardware firms show a split in investor confidence. Arista Networks (ANET) spiked over 10% in extended trading after hitting a new high on Tuesday. In contrast, Advanced Micro Devices (AMD) saw its stock fall sharply in overnight trade, which IBD notes signals a move back below its 50-day line.
Astera Labs (ALAB) also reported better-than-expected results but declined slightly amid overnight volatility.
Energy Slump and the Strait of Hormuz
U.S. crude oil prices dropped 5.7% to $75.77 a barrel, contributing to a 10.5% weekly decline. This tumble provided a broad lift to the equity markets. IBD reports that the price drop follows optimistic signals from President Donald Trump and officials from Qatar and Iran regarding a deal to open the Strait of Hormuz.
The decline in energy costs, coupled with a six-basis-point drop in the 10-year Treasury yield to 4.625%, has cooled the odds of a September rate hike. According to market data, the probability of a hike remains over 50% but has decreased since last Wednesday.
Did you know? The Nasdaq’s recent 8.8% four-session advance is its strongest performance since April 2025, suggesting a potentially sustained market advance.
Sector Performance and Earnings Beats
Several companies reported beats early Wednesday, with Shopify (SHOP) seeing its stock rocket more than 25% before the open. Eli Lilly (LLY) and CVS Health (CVS) also beat views and rose solidly, while Disney (DIS) climbed modestly.
Other notable earnings movements include:
- Travere Therapeutics (TVTX) and Qualys (QLYS): Both jumped over 10%.
- Okeanis Eco Tankers (ECO): Climbed solidly.
- Amgen (AMGN): Edged higher, remaining in a buy zone.
- SharkNinja (SN): Fell slightly despite beating views.
ETF Movement Summary
| ETF | Gain/Loss | Focus Area |
|---|---|---|
| SMH | +5.55% | Semiconductors |
| IGV | +4.7% | Tech-Software |
| XME | +4.6% | Metals & Mining |
| XLE | -0.5% | Energy |
Frequently Asked Questions
Why did SpaceX stock drop despite a revenue jump?
While revenue grew 92%, SpaceX reported a loss of 9 cents per share due to high capital spending.
What is driving the current stock market rally?
The rally is supported by strong earnings in software and AI hardware, falling crude oil prices, and retreating Treasury yields.
Which AI stocks are showing strength?
Arista Networks has shown significant strength, while AMD and Astera Labs have experienced more volatility around their 50-day lines.
What do you think about the current AI hardware volatility? Are you holding AMD or shifting toward networking plays like Arista? Let us know in the comments below or subscribe to our newsletter for daily market updates.
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