U.S. equities advanced Wednesday, extending Tuesday’s comeback as strength in large-cap technology stocks, particularly Nvidia and Oracle, underpinned broader market sentiment.
The S&P 500 rose 0.9%, the Nasdaq Composite gained 1.3%, and the Dow Jones Industrial Average added 287 points, or 0.6%, as investors positioned ahead of a crucial slate of technology earnings.
Markets are navigating a delicate moment. Artificial intelligence optimism remains intact, but investors are increasingly selective as capital expenditure commitments from hyperscalers grow larger and valuation scrutiny intensifies.
Nvidia earnings in focus as AI capex debate builds
Nvidia shares climbed 2.2% ahead of its quarterly earnings release scheduled after the closing bell. Results from Salesforce and Snowflake are also due.
Nvidia’s report lands amid heightened investor debate over AI infrastructure spending. Hyperscale cloud providers have recently increased forward capital expenditure plans, raising questions about sustainability and return on investment.
Ulrike Hoffmann-Burchardi, chief investment officer for the Americas and global head of equities at UBS, wrote that continued market confidence may hinge partly on Nvidia’s guidance. With hyperscalers announcing another step-up in capex, markets expect Nvidia to project revenue above consensus estimates alongside robust sales growth.
Wedbush analysts echoed that view, noting that 2026 hyperscale capex forecasts have exceeded prior expectations, with AI servers and infrastructure representing the bulk of incremental spending.
Michael Rosen, chief investment officer at Angeles Investment Advisors, cautioned investors against underestimating CEO Jensen Huang, saying he has “played his cards extremely well.” Still, with Nvidia pacing for a fourth consecutive gain, Rosen also flagged that the run could invite profit-taking.
Nvidia is the lone trillion-dollar tech stock higher year-to-date, up 2.7% in 2026 as of Monday’s close, while the Nasdaq has fallen more than 2.5%. Microsoft, Amazon and Tesla have all posted double-digit declines.
For additional context on enterprise AI earnings positioning, see Swikblog’s coverage of Salesforce earnings and Agentforce AI strategy.
Oracle upgrade sparks software rebound
Oracle jumped 3% after Oppenheimer upgraded the stock to outperform from perform and set a $185 price target, implying 27% upside. The firm cited an attractive risk-reward profile following a sharp pullback.
Shares of Oracle have fallen 25% in 2026 and 13% over the past 12 months. Oppenheimer said valuation multiples have been cut significantly since September, creating a more balanced setup for investors willing to wait for execution.
The iShares Expanded Tech-Software Sector ETF rose another 2% after a 2% gain in the prior session. Palantir Technologies and Microsoft climbed, while Workday slipped after issuing a softer revenue forecast.
Rosen described recent AI-related fears surrounding software as “a bit overblown,” arguing the market is shifting from indiscriminate buying toward more discerning stock selection. He said the earlier “sell-first, ask-questions-later” posture appears to be easing as investors reassess whether “things maybe are not quite so scary.”
Anthropic announcement eases disruption fears
On Tuesday, major averages advanced as anxiety over AI disruption across industries dissipated. Software and cybersecurity stocks rallied after Anthropic launched new connectors and plugins for its knowledge worker tool, Claude Cowork, enabling companies to connect it to existing apps such as Google Drive.
Wall Street framed the rollout as additive to software providers rather than threatening. Wells Fargo analyst Jason Haas wrote that the announcement reinforces that domain expertise and data assets remain crucial for building industry-specific AI.
First Solar drops after earnings miss and weak outlook
First Solar shares fell more than 12% after the company missed fourth-quarter earnings expectations and issued weak full-year guidance. If losses hold through the close, it would mark the stock’s worst day since June.
Analysts split on the takeaway. Baird downgraded the stock to neutral, pointing to crosswinds complicating the setup. HSBC cut its rating to hold, citing long-term competitive threats including Tesla, while still noting First Solar’s leading position as a U.S. player under supportive domestic policies. Goldman Sachs recommended buying the dip, arguing the stock could underperform near term on estimate revisions but still has potential for stronger bookings and an inflection in volumes and margins into 2027 and beyond.
Broader coverage of these developments can be followed through outlets such as Reuters and Bloomberg.
Weak breadth despite gains
Despite higher headline indexes, market breadth was soft. FactSet data showed 1,415 New York Stock Exchange-listed names were lower, while 1,157 advanced.
Piper Sandler said weakness in the “Magnificent Seven” is spoiling sentiment, even as market breadth improves globally and domestically. The firm contrasted the 2023–2025 period, when mega-cap strength lifted the S&P 500 despite broad underperformance, with the current environment where improving breadth is being overshadowed by weakness in the largest names.
Bank of America flags catalysts for Robinhood
Bank of America reiterated a buy rating on Robinhood following the company’s September addition to the S&P 500 and set a $122 price objective, implying 66% upside.
The firm pointed to potential regulatory clarity from the CLARITY Act, suggesting “crypto winter near bottom” if the bill advances. Crypto is one of Robinhood’s largest segments, contributing about 15% of revenues.
Bank of America also highlighted Robinhood’s AI customer service model, Cortex, which is expected to be integrated into the app soon, alongside longer-term plans to build a fully AI-powered financial advisor and discussions with regulators. The analyst additionally applauded the company’s digital bank launch and plans to develop its own layer 2 blockchain.
Axon rallies as AI boosts software demand
Axon Enterprise surged more than 20% after reporting a fourth-quarter earnings and revenue beat. Particularly notable was its software business, which expanded 40% during the quarter, with the company crediting AI-driven demand.
Axon shares had fallen more than 25% for 2026 as of Tuesday’s close amid concerns that AI would disrupt software models. CEO Rick Smith said AI will create value customers “cannot replicate,” helping reverse part of the drawdown. By midday Wednesday, the stock was down just over 5% for the year.
Geopolitics, tariffs and the State of the Union
Investors also monitored U.S.-Iran tensions. Over the weekend, President Donald Trump threatened to raise global tariffs to 15%, but a 10% duty on global imports was implemented Tuesday.
Trump delivered a nearly two-hour State of the Union address Tuesday night, describing the economy as poised to boom. He proposed offering workers access to a government-backed retirement account and again called for banning large institutional investors from purchasing single-family homes.
Wolfe Research said the speech largely avoided affordability concerns. Full-year GDP growth came in at 2.2%, slightly above longer-term trend but the slowest since the 2020 pandemic year. Trump also blamed Democrats for a government shutdown that the Commerce Department said shaved about a percentage point off fourth-quarter growth. Recent polling has signaled voter dissatisfaction with the economy, particularly inflation.
For related regulatory pressure involving major media and tech players, see Swikblog’s report on the Netflix-Warner DOJ probe involving 11 U.S. states.
Other movers and commodities in focus
Elsewhere, PayPal rallied 13% over two days after a report that Stripe is weighing an acquisition of all or part of the company, though Stripe declined to comment.
In premarket moves, GoDaddy slid 9% after forecasting annual revenue below estimates, citing slow AI-related adoption. Lowe’s fell about 3% after issuing weaker forward guidance for earnings through January 2027, even as it beat on adjusted earnings and revenue for the prior quarter. First Solar also dropped sharply premarket before extending losses during the session.
In after-hours activity from the prior day, Lucid Group fell more than 4% after posting a wider-than-expected loss, while Workday dropped nearly 10% after guiding subscription revenue slightly below expectations and issuing disappointing margin guidance. CoStar fell 8% on weaker-than-expected first-quarter guidance. Cava climbed 8% after quarterly results and a fiscal 2026 outlook that topped estimates.
Commodities also stayed on investors’ radar. May coffee futures are down nearly 15% in February, the most since October 2022, taking the year-to-date decline to almost 19%. May cocoa futures have slid another 26% in February after dropping more than 31% in January and are down more than 49% so far in 2026.
