Nvidia Leads Market Higher

The US stock market ticked higher on Wednesday, led by its most influential stock, Nvidia.

• The S&P 500 rose 38.09 points, or 0.6%, to 6,881.31 after paring a gain that briefly reached 1%.
• The Dow Jones Industrial Average added 129.47 points, or, 0.3%, to 49,662.66.
• The Nasdaq composite rose 175.25 points, or 0.8%, to 22,753.63.

Nvidia was the strongest force lifting the market after Meta Platforms announced a a long-term partnership where it will use millions of chips and other equipment from Nvidia for its artificial-intelligence data centers, the AP reports.

"No one deploys AI at Meta's scale," Nvidia CEO Jensen Huang said. Nvidia's 1.6% rise demonstrated the upside of AI development for the US stock market. But investors have also focused on the potential downsides recently, which has led to sharp swings for Wall Street. Worries are rising, for example, about how much companies like Meta are spending on AI and whether they can possibly make back their huge investments through higher profits and productivity in the future. Meta's stock fell as much as 1.7% before bouncing back to a gain of 0.6%.

Several profit reports from companies helped to lift stocks Wednesday. Cadence Design Systems climbed 7.6% after delivering both profit and revenue for the latest quarter that topped analysts' expectations. CEO Anirudh Devgan credited what he called "the essential nature of Cadence's engineering software," even as investors worry about AI threatening to remake the industry. Analog Devices rose 2.6% after likewise topping analysts' estimates for profit and revenue. The chip company said it saw record orders during the quarter for its data center business. Outside of earnings reports, Moderna rose 6.1% after saying regulators at the Food and Drug Administration will review its flu vaccine candidate after earlier refusing to consider it.

• They helped offset a 6.8% drop for Palo Alto Networks. The cybersecurity company reported a stronger profit for the latest quarter than analysts expected, but it gave profit forecasts for the current quarter and the remainder of its fiscal year that fell short of their estimates.

In the bond market, Treasury yields ticked higher following reports on the US economy that came in better than economists expected. One report said that industrial production improved last month by more than economists expected. Another said orders for computers, fabricated metal products and other long-lasting manufactured goods rose more in December than economists expected, when not including airplanes and other transportation equipment. A third report said homebuilders broke ground on more new homes in December than expected.