By Sinéad Carew and Johann M Cherian
(Reuters) – Wall Street’s main indexes rose on Wednesday, with the benchmark S&P 500 hitting a record high, as investors cheered streaming video provider Netflix’s quarterly report and technology shares rallied after the announcement of a private-sector artificial intelligence infrastructure plan.
Risk appetites got a boost from data pointing to a strong economy with cooling inflation and U.S. President Donald Trump’s more moderate than feared approach to tariffs so far.
Netflix was the S&P 500’s biggest percentage gainer with a 9.8% advance after the company reported a record number of subscribers for the holiday quarter, enabling it to increase prices for most service plans.
The technology sector was the biggest gainer while Nvidia was the biggest boost for the S&P 500 and the Nasdaq followed by Microsoft.
Investors were piling bets into the promise of AI Tuesday’s announcement by Trump of a $500 billion private-sector AI infrastructure plan from Oracle, OpenAI and SoftBank, even though there was no clarity on funding.
“It’s a story of big tech and everything else is hanging in there,” said Matt Stucky, chief portfolio manager for equities at Northwestern Mutual Wealth Management, who attributed much of Wednesday’s rally, particularly in chip stocks, to the AI announcement.
“The direct beneficiary, at least the beginning would be the semiconductor space,” he said pointing to the Philadelphia semiconductor index outperformance with a 2.3% gain.
But without funding clarity, Stucky described the news as “more of a pie in the sky kind of investment story.”
Nevertheless, Oracle shares were up 7.6% while server makers Dell and Super Micro added more than 4%. Microsoft added 3.9% and Nvidia rose 4.8%. U.S. traded shares of ARM Holdings, a technology supplier to chip companies that is 90% owned by SoftBank, were up 14.8%.
Investors were still waiting cautiously for Trump’s trade plans due to inflation concerns after he warned that tariffs on imports from China, Mexico, Canada and the European Union could be issued on Feb. 1.
The president has ordered federal agencies to complete comprehensive reviews of a range of trade issues by April 1 – the date that analysts at Barclays say markets should focus on.
The Dow Jones Industrial Average rose 111.36 points, or 0.25%, to 44,136.46, the S&P 500 gained 40.88 points, or 0.68%, to 6,090.12 and the Nasdaq Composite gained 252.60 points, or 1.28%, to 20,009.69.
Just two of the 11 S&P 500 sectors rose, with technology rising 2.6% communications services up 1.3% with Netflix leading the charge followed by Meta Platforms.
In individual stocks Procter & Gamble advanced 2.2% after beating second-quarter estimates, driven by growing demand for its household items in the United States.
Johnson & Johnson fell 2.5% although the drugmaker reported fourth-quarter results above estimates.
After rising on Tuesday, Ford lost 3.3% as Barclays downgraded the stock. Textron fell 4% after it forecast 2025 profit below estimates.
Halliburton slipped 2.6% after warning of softer activity in North America this year and posting downbeat quarterly revenue.
Declining issues outnumbered advancers by a 1.43-to-1 ratio on the NYSE where there were 242 new highs and 46 new lows.
On the Nasdaq, 1,896 stocks rose and 2,456 fell as declining issues outnumbered advancers by a 1.3-to-1 ratio.
The S&P 500 posted 38 new 52-week highs and 4 new lows while the Nasdaq Composite recorded 98 new highs and 79 new lows.
(Reporting by Sinéad Carew in New York, Johann M Cherian, Purvi Agarwal and Sukriti Gupta in Bengaluru; Editing by Arun Koyyur, Maju Samuel and David Gregorio)
