U.S. stocks pushed higher on Wednesday, led by a strong showing from major banks and chipmakers, even as investors remained cautious over renewed U.S.-China trade tensions.
The S&P 500 rose 0.27% to 6,662.25 points, supported by solid third-quarter results from Morgan Stanley and Bank of America. Morgan Stanley jumped 5.8% to a record high, while Bank of America gained 3.9%, both beating Wall Street estimates thanks to stronger dealmaking activity. The S&P 500 banking index added 1.6%, on track for its first three-day winning streak in more than three weeks.
Earlier in the week, Goldman Sachs and JPMorgan Chase had also reported upbeat earnings, signalling resilience in investment banking and hinting that deal flow could remain robust despite macro uncertainty. The strong start to earnings season has boosted confidence in corporate America’s underlying strength, even as the U.S. government shutdown continues to delay key economic reports.
Chip stocks also rallied, with the Philadelphia Semiconductor Index climbing 2.7% after ASML reported better-than-expected third-quarter results driven by strong AI-related demand. U.S.-listed ASML shares gained 1.6%.
Elsewhere, data centre shares surged after reports that a consortium including BlackRock, Microsoft, and Nvidia will acquire one of the world’s largest data centre operators in a $40 billion deal. Applied Digital soared nearly 8% on the news.
The Nasdaq advanced 0.46% to 22,625.23, while the Dow Jones edged 0.05% higher to 46,293.43. Industrials and materials lagged, down 0.47% and 0.31% respectively, as six of the 11 S&P 500 sectors declined.
Trade headlines remained in focus. Treasury Secretary Scott Bessent said that Washington does not want to escalate tensions with Beijing and confirmed that President Donald Trump plans to meet President Xi Jinping later this month in South Korea. His comments followed Trump’s statement on Tuesday that the U.S. was considering cutting certain trade ties with China, including cooking oil imports, while both countries imposed new port fees in a tit-for-tat move.
On monetary policy, Fed Governor Stephen Miran said “two more cuts this year sounds realistic,” citing labour market weakness. Fed Chair Jerome Powell also left the door open for further easing.
In corporate movers, Abbott fell 4% after weaker-than-expected quarterly revenue, while insurer Progressive slumped 6.7% after its results disappointed. Grain trader Bunge jumped 11.6% despite trimming its 2025 earnings forecast following its merger with Viterra.
