Wall Street Flirts With a Record       08/12 09:43

   Wall Street is flirting with a record Wednesday after several AI stocks 
reported better growth for the spring than analysts expected, while a report 
showed inflation across the United States was slightly less bad last month.

   NEW YORK (AP) -- Wall Street is flirting with a record Wednesday after 
several AI stocks reported better growth for the spring than analysts expected, 
while a report showed inflation across the United States was slightly less bad 
last month.

   The S&P 500 added 0.3% and was on track for its first gain since setting its 
all-time high on Friday. The Dow Jones Industrial Average was up 57 points, or 
0.1%, as of 10:30 a.m. Eastern time, and the Nasdaq composite was 0.7% higher.

   Stocks in the artificial-intelligence technology business helped lead the 
way after strong profit reports bolstered hopes they can continue to deliver 
big-enough growth to justify the huge gains their prices have made.

   Super Micro Computer, which sells servers and other equipment, jumped 14.2% 
after reporting earnings per share for the latest quarter that were 84% higher 
than analysts expected. It also gave forecasts for upcoming profit and revenue 
that topped analysts' expectations.

   CoreWeave, which offers AI computing power to customers over the cloud, 
leaped 18.6% after reporting better revenue for the latest quarter than 
analysts expected, along with a milder loss. CEO Michael Intrator said demand 
is accelerating from customers as big businesses adopt AI.

   CoreWeave gives its customers access to AI chips from Nvidia, and Nvidia 
climbed 3.1% to act as the single strongest forces lifting the S&P 500.

   It's a return to strength for AI stocks, which have been veering on a 
roller-coaster ride for months. After surging to records, AI stocks came under 
pressure on worries that they shot too high. Investors wanted to see big 
spenders on AI prove that their investments are yielding better profits to make 
them worth it. That in turn could lead to continued demand for chips and other 
building blocks of AI data centers.

   Wall Street also got some broad support from easing yields in the bond 
market. Treasury yields fell after a report showed that U.S. consumers paid 
prices for gasoline, groceries and other costs of living last month that were 
3.4% higher than a year earlier.

   That's higher than anyone would like, but it's not as bad as the 3.5% 
inflation rate of June.

   The deceleration could give the Federal Reserve more leeway to hold off on 
hikes to interest rates. Higher rates would help keep a lid on inflation, but 
it would do so by making it more expensive for U.S. households and companies to 
borrow and forcing a slowdown in the economy. Higher interest rates also would 
undercut prices for stocks and other investments.

   The Fed's members have been notably split about whether they should have 
already begun hiking interest rates. But Wednesday's update on inflation pushed 
traders to pull back on bets the Fed will hike its main interest rate at its 
next meeting in September.

   Traders are betting on just a 38% chance of it, down from the coin flip's 
chance seen the day before, according to data from CME Group.

   That helped pull the yield on the 10-year Treasury down to 4.65% from 4.70% 
late Tuesday. It, though, still remains well above its 3.97% level from before 
the war with Iran, which sent oil prices and worries about inflation spiking.

   Oil prices edged lower on Wednesday, and the price for a barrel of Brent 
crude slipped 0.4% to $88.55.

   Higher yields have already pulled long-term mortgage rates to their highest 
level in a year. That is hurting the housing industry, and losses for 
homebuilders on Wednesday helped keep the market in check. D.R. Horton fell 
3.2%, and Lennar lost 2.4%. Builders FirstSource, which sells countertops and 
other building materials, dropped 4.8%.

   In stock markets abroad, indexes were mixed across Europe and Asia.

   South Korea's Kospi jumped 3.7% for one of the world's bigger gains. It's 
been at the center of the jarring swings for AI stocks because it's dominated 
by two tech giants, Samsung Electronics and SK Hynix.

   ___

   AP Business Writers Michelle Chapman and Elaine Kurtenbach contributed to 
this report.

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