US STOCKS-S P 500 Dow Rise As Investors Digest Earnings Rate Cut

Alphabet falls nearly 8% after downbeat revenues, heavy AI invest


Indexes: Dow up 0.47%, clashofcryptos.trade S&P 500 up 0.19%, Nasdaq down 0.07%


(Updates as of mid afternoon)


By Abigail Summerville and Shashwat Chauhan


The S&P 500 and the Dow rose on Wednesday, as financiers started to reject disappointing Alphabet revenues and weighed the prospect of future rate of interest cuts from the U.S. Federal Reserve.


Google-parent Alphabet dropped 7.3% after publishing downbeat cloud earnings growth on Tuesday and allocating a higher-than-expected $75 billion financial investment for its AI buildout this year.


AI-related stocks showed signs of healing after being rocked last week following the soaring popularity of a low-priced Chinese synthetic intelligence model developed by start-up DeepSeek. Nvidia, which signed up one of the greatest losses, was up 3.3% on Wednesday.


"Ultimately, need is not disappearing for AI even with the DeepSeek news. They ´ re all going to need to invest more money and that ´ s what the AI story has been. This is a fairly long cycle story," said Rob Haworth, senior investment strategist at U.S. Bank Asset Management.


Advanced Micro Devices, meanwhile, lost 8.2% after CEO Lisa Su said the business's current-quarter information center sales - a proxy for its AI revenue - would fall about 7% from the previous quarter.


On the data front, investors are expecting the January nonfarm payrolls report, anticipated to be released on Friday.


U.S. services sector activity suddenly slowed in January amidst cooling demand, assisting curb price growth, a report from the Institute for Supply Management revealed on Wednesday.


"There are some concerns that the Fed might need to alleviate quicker, that the economy is slowing, but that ´ s really positive news for the marketplaces because they ´ re looking for those Fed rate cuts," Haworth said.


The next Federal Open Markets Committee conference remains in March, and while just 16.5% of traders anticipate a rate cut then, a bulk of traders expect a cut in June, according to CME's FedWatch Tool.


Richmond Fed president Thomas Barkin said the Fed was still leaning towards more rate cuts this year, but flagged uncertainty around the effect of brand-new tariffs, immigration, regulations and other initiatives from U.S. President Donald Trump's administration.


At 2:00 p.m. ET (1900 GMT), the Dow Jones Industrial Average increased 207.53 points, or 0.47%, to 44,763.57, the S&P 500 gained 11.61 points, or 0.19%, to 6,049.49 and the Nasdaq Composite lost 12.91 points, or forum.pinoo.com.tr 0.07%, to 19,641.11.


Nine of the 11 S&P 500 sectors traded greater, with genuine estate and energy stocks leading the gains while interaction services fell over 3%.


Shares of Apple slipped 1.2% as Bloomberg News reported that China's antitrust regulator was preparing for a possible examination of the iPhone maker.


Fiserv advanced 7.3% as the payments company beat estimates for fourth-quarter profit, helped by strong demand in its banking and payments processing unit.


Markets likewise await advancements on the tariffs front after Trump said on Tuesday he remained in no rush to talk to Xi Jinping to attempt to defuse a brand-new trade war between the nations.


The Cboe Volatility Index, called Wall Street's worry gauge, dropped 6.3% to 16.1 today.


In business movers, FMC Corp plunged 32% after the agrichemicals manufacturer forecast first-quarter earnings listed below estimates.


Johnson Controls jumped 12.5% as the structure services business named Joakim Weidemanis as president and raised its 2025 earnings projection.


Advancing concerns surpassed decliners by a 2.62-to-1 ratio on the New York Stock Exchange, and by a 1.88-to-1 ratio on the Nasdaq.


The S&P 500 posted 31 new 52-week highs and 12 new lows while the Nasdaq Composite taped 100 brand-new highs and 85 brand-new lows.


(Reporting by Abigail Summerville in New York, Shashwat Chauhan and Sukriti Gupta in Bengaluru; Editing by Pooja Desai, Devika Syamnath, Maju Samuel and Nia Williams)