Updated 2 min read
US stocks moved higher on Wednesday, looking to add to a run of wins on the last day of trading before Thanksgiving as Wall Street stays upbeat on an interest-rate cut next month.
The Dow Jones Industrial Average (^DJI) inched up 0.3%, while the S&P 500 (^GSPC) moved up nearly 0.5%. The tech-heavy Nasdaq Composite (^IXIC) added more than 0.6%, following Tuesday’s sharp gains that were led by a 660-point jump in the Dow.
Stocks are gearing up for their fourth straight advance after tech names helped buoy the broader market to begin the week. Shares in Alphabet (GOOG) ended Tuesday at a fresh record high amid signs it is threatening Nvidia’s (NVDA) dominance in AI chips, but pulled back slightly at the open.
At the same time, investors continue to closely watch for influences on the Federal Reserve’s next policy move, given the US shutdown-driven data drought. The central bank’s Beige Book out Wednesday will shed light on how the US economy is performing region-by-region. It will be scoured for clues to consumer spending and the labor market as the Fed gets ready for its meeting in two weeks.
Markets are pricing in an over 80% probability of a December quarter-point rate cut after delayed September readings on retail sales and wholesale inflation fell short. Initial jobless claims unexpectedly fell last week to their lowest since April, Department of Labor data out Wednesday showed.
Meanwhile, palace intrigue at the central bank continues to pick up steam, with five finalists on President Trump’s shortlist to take Chair Jerome Powell’s place next year. Kevin Hassett, the White House’s top economic adviser, has emerged as the frontrunner as the search enters its final weeks.
In a holiday-shortened week, earnings hit their peak on Tuesday, with big-box retailers posting better-than-expected results. On Wednesday morning, Deere & Company (DE) shares slid after its full-year outlook fell short. The farm machinery maker was the biggest name left left on this week’s earnings calendar, with markets shuttered Thursday and finishing at 1 p.m. ET on Friday.
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Robinhood soars following deal with Susquehanna
Robinhood (HOOD) shares jumped 8.5% Wednesday morning following news that the investing platform is launching a futures and derivatives exchange in partnership with Susquehanna International Group through the acquisition of LedgerX.
The move is seen as a boon to the company as it looks to strengthen its foothold in the increasingly popular prediction markets.
“Robinhood is seeing strong customer demand for prediction markets, and we’re excited to build on that momentum,” JB Mackenzie, vice president and general manager of futures and international at Robinhood, said in a statement.
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Nvidia partly recovers from Tuesday’s loss, Alphabet falls short of $4 trillion
Nvidia (NVDA) stock added 2% Wednesday morning, mostly recovering its 2.6% drop during the prior trading session as a potential AI chip deal between Google (GOOG) and Meta (META) pressured shares.
In response to the news and concerns of rising competition from its own customer (Google), Nvidia said Tuesday that it’s “a generation ahead” of rivals.
Bernstein analyst Stacy Rasgon also responded to the news in a note to clients Tuesday saying that Nvidia’s “GPUs are clearly not going anywhere” and that the potential Google-Meta deal (reported by The Information) was a sign of sky-high demand for AI computing power but not necessarily a big competitive threat for Nvidia.
Alphabet fell fractionally Wednesday after adding 1.6% Tuesday, which had put the Google parent company closer to achieving a $4 trillion market cap.
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Stocks jump at the open
Tech led US stocks higher at the open on Wednesday, with the Nasdaq Composite (^IXIC) climbing more than 0.6%.
The S&P 500 (^GSPC) added nearly 0.5%, while the Dow Jones Industrial Average (^DJI) moved up 0.3%.
The moves built on gains in stocks on Friday, Monday and Tuesday as the market rebounded from sharp losses notched last week.
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JPMorgan sees the S&P 500 reaching 7,500 in 2026, but it could surge past 8,000 if the Fed keeps cutting rates
JPMorgan’s stock market strategists think 2026 will be another good year for US investors.
The firm’s equity strategy team, led by Dubravko Lakos-Bujas, set a year-end price target of 7,500 for the S&P 500 in 2026.
Should the Federal Reserve continue cutting interest rates, however, the bank thinks the S&P 500 could surpass 8,000 in the year ahead.
“Despite AI bubble and valuation concerns, we see current elevated multiples correctly anticipating above-trend earnings growth, an AI capex boom, rising shareholder payouts, and easier fiscal policy (i.e. OBBBA),” the firm wrote in a note to clients published Tuesday.
“More so, the earnings benefit tied to deregulationand broadening AI-related productivity gains remain underappreciated.”
JPMorgan’s 7,500 call for next year is primarily supported by expected earnings growth of between 13%-15% over the next two years. In the third quarter, S&P 500 companies grew earnings by 13.4% from the prior year, according to FactSet data.
The firm’s baseline outlook also sees the Fed cutting rates two more times — markets were pricing in an 85% chance the Fed cuts rates next month as of Wednesday morning — before an extended pause. An improving inflation outlook that prompts more rate cuts is what JPMorgan sees catalyzing a rise toward, and above, 8,000 for the benchmark index.
The firm’s call that the S&P 500 will reach 7,500 next year also makes it the second Wall Street bank this week to put that target on the index for 2026, with strategists at HSBC making the same forecast in a note published Monday.
The S&P 500 closed Tuesday’s trading session at 6,765.
Both firms also note that the US economy is becoming increasingly K-shaped, with wider extremes between the haves and have nots reshaping spending habits and consumer confidence.
This most recent earnings season showed that consumers on the lower-end of the income scale continue to struggle — or in retailer lingo, remain “choiceful” — while those with greater means (and often more exposure to the stock market), are spending freely.
For stock investors, this dynamic is also likely to keep sentiment “prone to sharp swings,” in JPMorgan’s view, as this unhealthy economic backdrop is contrasted with an improving outlook for large firms set to benefit from a broadening out of AI trends across industries.
“Both corporates and governments across the world are racing to invest in AI in search of productivity gains and out of fear of becoming obsolete,” JPMorgan’s team writes.
“The AI sector’s momentum is spreading geographically and across a diverse list of industries, from Technology and Utilities to Banks, Health Care and Logistics, and in the process creating winners and losers.
“The challenge — this disruption is unfolding within an already unhealthy K-shaped economy, with AI expected to amplify this polarization even further. The AI ‘Wall of Worry’ is likely to persist for years to come.”
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Robinhood, Susquehanna push further into prediction markets with LedgerX acquisition
Robinhood (HOOD) announced a new joint venture with Susquehanna late on Tuesday that will see the two partners take over a futures and derivatives exchange from Miami International Holdings, clearing the way for Robinhood to launch its own prediction market.
Robinhood and Susquehanna will take a 90% stake in LedgerX, which Miami International Holdings acquired from FTX in 2023 for $50 million as part of the crypto exchange’s bankruptcy proceedings, according to Reuters. The exchange is already regulated by the Commodity Futures Trading Commission (CFTC).
The move is aimed at expanding Robinhood’s push into prediction markets and event contracts trading. The platform already offers prediction market contracts through Kalshi.
It comes after a court ruling in September of last year removed a ban on election betting, which has led to the swelling of prediction markets and activity in the industry.
“Robinhood is seeing strong customer demand for prediction markets, and we’re excited to build on that momentum,” said Robinhood’s general manager of futures, JB Mackenzie. “Our investment in infrastructure will position us to deliver an even better experience and more innovative products for customers.”
Robinhood stock jumped over 4% ahead of the opening bell on Wednesday.
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Good morning. Here’s what’s happening today.
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HSBC sees S&P 500 hitting 7,500 by end of 2026 with ‘more to come’ in the AI trade
Yahoo Finance’s Hamza Shaban writes in today’s Morning Brief newsletter:
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Deere outlook falls short as farm rebound remains elusive
Deere and Co.’s (DE) stock fell 5% before the bell on Wednesday after its outlook fell short of analysts’ expectations. Uncertainty persists regarding the timing of a recovery in the US farm economy.
Bloomberg News reports:
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Nvidia says it isn’t using ‘circular financing’ schemes. 2 famous short sellers disagree.
Yahoo Finance’s Laura Bratton reports:
Nvidia (NVDA) sent a memo to Wall Street analysts over the weekend arguing that it is not engaged in vendor financing, a controversial practice in which suppliers invest in or extend loans to their own customers.
Famed short sellers Jim Chanos and Michael Burry aren’t so sure.
Nvidia wrote a seven-page document — first reported by Barron’s on Tuesday morning — rebuffing claims that it invests in its own customers to inflate its revenue. The memo was written in response to a newsletter from a little-known Substack author last week claiming that the $5 trillion AI chipmaker is engaged in a “circular financing scheme” — using vendor financing to boost sales — drawing parallels between Nvidia and famous dot-com era accounting frauds committed by Enron and Lucent.
… Chanos, who is famous for predicting the fall of Enron, thinks the comparison between Nvidia and Lucent bears weight.
“They’re [Nvidia is] putting money into money-losing companies in order for those companies to order their chips,” Chanos told Yahoo Finance in an interview.
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Premarket trenders: Alphabet, Workday, and HP
Alphabet (GOOG, GOOGL) stock continued to rise in premarket trading on Wednesday and was up more than 1% following the report that Google is in talks to supply chips to Meta (META).
Workday (WDAY) stock fell more than 5% before the bell on Wednesday after the company reported lukewarm third quarter subscription revenue, a sign of softer demand.
HP (HP) stock fell 5% during premarket trading on Wednesday following the tech company’s news that it will reduce its headcount by 4,000 to 6,000 people. HP also issued a lower-than-expected earnings projection for the new fiscal year.
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HP stock sinks after CEO says it’s cutting thousands of jobs amid AI push
Shares of HP Inc. (HPQ) slid over 5% in premarket trading as Wall Street assessed its quarterly earnings released late Tuesday.
The tech company plans a sweeping AI initiative tied to new restructuring efforts that are expected to eliminate up to 6,000 jobs worldwide and to generate $1 billion in cost savings in coming years.
Yahoo Finance’s Francisco Velasquez reports:
Read more here and watch the full interview with Lores and Yahoo Finance executive editor Brian Sozzi below.
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Dell stock pops as strong AI demand lifts FY profit guidance
Dell (DELL) shares rose nearly 6% in premarket trading after the company slightly missed Wall Street’s revenue estimates but issued fourth quarter financial guidance above expectations.
The tech hardware giant pointed to surging demand for its AI servers and stronger performance in its infrastructure business.
From Reuters:
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Gold rises on Fed rate-cut and dollar weakness
Bloomberg reports:
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Alibaba AI arm sees over a third in revenue growth
Bloomberg reports:
