AI infrastructure earnings and a second month of cool CPI push the tape toward new highs — but Cisco's sell-the-beat reaction shows how high the bar sits
Wednesday belonged to the AI build-out: CoreWeave roughly doubled revenue with margin upside, Nebius jumped 20% on beats, Super Micro's report gave Nvidia a positive read-through, and JPMorgan raised its S&P 500 target to 8,000 arguing the AI bet is finally paying off. July CPI cooled as expected for a second month, denting September Fed-hike odds — notable that the live debate this cycle is hikes, not cuts. The caution flags sit in the reactions, not the numbers: Cisco beat with an above-view fiscal 2027 outlook and still fell after hours, Coherent was a loser, and Liquidia dropped despite a sales beat. Overseas, hot Japanese wholesale inflation firmed September BOJ hike odds while Asia followed Wall Street higher.
AI infrastructure earnings carry the rally
The capex-justification question got its best answers yet: CoreWeave's revenue roughly doubled on AI demand with operating-margin upside, Nebius soared 20% on revenue and EBITDA beats, Cerebras said core revenue grew 103%, and Lumentum topped estimates despite supply constraints. Super Micro's beat read through directly to Nvidia. JPMorgan capped it with an 8,000 S&P 500 target, saying Wall Street's AI bet is finally paying off — against a Q2 scorecard of 41.6% aggregate earnings growth and an 83% EPS beat rate.
Cool CPI keeps Fed hikes — not cuts — on hold
July CPI slowed for a second straight month, in line with forecasts, and the consistent framing across sources is that it eases the odds of a September rate hike rather than teeing up easing. The dollar still gained and the yen slipped. The fiscal backdrop is less tidy: the July deficit topped $432 billion on higher outlays and negative tariff receipts, and weak wage growth is squeezing real spending power.
Sell-the-beat reactions expose a demanding bar
Not every good print got paid. Cisco beat on earnings and revenue and guided fiscal 2027 sales above views, yet shares fell after hours; Coherent was the session's other late earnings loser even as optical peer Lumentum rallied. Liquidia dropped despite double-digit Yutrepia growth and a sales beat, and SpaceX supplier Applied Aerospace & Defense fell about 10% on its first post-IPO report. When leadership is this extended, in-line-plus is treated as a miss.
The private-and-newly-public AI complex heats up
SpaceX rose as much as 11% — back above its IPO price — after releasing Grok 4.6, with Morgan Stanley arguing investors underestimate its AI unit. Anthropic is reportedly in talks to buy AI startup Decart for about $6 billion per Bloomberg. Oracle climbed on a Quantinuum partnership alongside a reported layoffs-for-AI-investment push, while Quantinuum's first post-IPO earnings beat with above-view 2026 guidance. Deal velocity and IPO-class supply are both accelerating.
13F season: Ackman buys Netflix, Wood adds Broadcom
Pershing Square disclosed a new Netflix stake among six new positions, drawing what's-different-this-time scrutiny given Ackman's prior run at the name. Cathie Wood bought $16.2 million of Broadcom ahead of its earnings report. Positioning headlines, not fundamentals — but they mark where large allocators see the next leg.
Global rate pressure builds outside the US
Japan's wholesale inflation stayed hot, bolstering odds of a September BOJ hike, and an RBA official said Australian rate risks are skewed higher — even as ANZ reported mortgage applications down 12%. The divergence trade (cooling US prints versus tightening pressure in Asia-Pacific) puts the yen and carry positioning in focus.