US equity indexes rose Wednesday as gains in SpaceX and Super Micro Computer lifted risk sentiment ahead of quarterly earnings from Meta Platforms and Tesla. The Nasdaq Composite closed 1.1% higher at 26,701.7. The S&P 500 finished 0.6% higher at 7,754.6, while the Dow Jones Industrial Average gained 0.5% to end at 52,765.7.
SpaceX, which topped the list of mega-cap stocks by market capitalization, gained 7.1%. The company also led the Nasdaq among gainers after announcing late Tuesday that it swung into the black in the third quarter. Revenue rose during the period, driven by strong performance in its artificial intelligence and connectivity divisions.
Elon Musk, who heads both SpaceX and Tesla, stated that the two companies have formed special committees to evaluate a potential merger. In a note issued Wednesday, Saxo Bank suggested a deal could allow the firms to share technology, reduce overlapping costs, and accelerate development. The brokerage estimated the combined market value of SpaceX and Tesla at approximately $3.5 trillion.
The iShares PHLX Semiconductor Exchange Traded Fund, which manages about $48.43 billion in assets, jumped 1.9% as investors re-entered the artificial intelligence trade following last week's sharp sell-off. Super Micro Computer's shares surged 9.5% after the company reported preliminary first-quarter fiscal revenue and margin results that exceeded expectations late Tuesday.
According to data compiled by Finviz, six of the top ten stocks in the category with a market capitalization exceeding $200 billion were from the technology sector.