US stocks closed higher on Wednesday, with the S&P 500 and the Nasdaq each rallying more than 1% as earnings from neocloud firm CoreWeave eased investor concerns about the sustainability of the AI trade, while Nvidia stabilised after two consecutive sessions of sharp declines.
Battered CoreWeave shares surged 24.7%, their biggest daily percentage jump in more than three months, to close at their highest level in two weeks. The company said it expected to become profitable in the first half of 2028 on an adjusted basis, seeking to reassure investors that strong demand and customer commitments could support its debt-fuelled expansion.
Sentiment improved across AI infrastructure stocks, with Nebius Group surging 15.4% and Applied Digital jumping 7.4%.
Nvidia advanced after shedding about $430 billion in market capitalisation over the previous two sessions, as investors worried about CEO Jensen Huang's relationship with a businesswoman alleged to be a Chinese spy.
Equities have been volatile in recent days. Investors have expressed concerns about increased regulation in the AI sector following sweeping Democratic victories in last week's US midterm elections. Those worries, alongside concerns about Nvidia's leadership, have put pressure on one of the biggest pillars of the current bull market.