Wall Street stocks rallied sharply on Wednesday, with the Dow Jones Industrial Average surging more than 640 points as falling oil prices and easing Treasury yields boosted investor sentiment ahead of Nvidia’s closely watched quarterly earnings report.
The Dow climbed 1.3%, while the S&P 500 gained 1% and the Nasdaq Composite advanced 1.4%.
The rally followed three consecutive days of losses tied to concerns over rising inflation, elevated bond yields, and tensions in the Middle East.
Technology and semiconductor shares led the rebound as investors shifted focus back toward artificial intelligence growth themes.
The Philadelphia Semiconductor Index rallied strongly, with gains from companies including Astera Labs and Arm Holdings ahead of earnings from Nvidia.
Oil prices and Treasury yields retreat
Investor sentiment improved after signs emerged that tensions involving Iran could ease.
President Donald Trump told reporters the administration was in the “final stages” of negotiations with Iran, while Iran’s foreign ministry confirmed communication between the two countries was continuing.
The developments triggered a sharp decline in oil prices.
West Texas Intermediate crude futures fell 5.66% to settle at $98.26 per barrel, while Brent crude dropped 5.63% to $105.02 a barrel.
Treasury yields also retreated after climbing sharply in recent sessions.
The benchmark 10-year Treasury yield fell more than 8 basis points, while the 30-year Treasury yield declined 6 basis points.
Markets had been rattled earlier in the week after the 30-year yield reached its highest level since 2007 and the 10-year yield approached multi-year highs.
Investors worried that higher energy prices could reignite inflation and potentially force the Federal Reserve into additional rate hikes.
Minutes from the Fed’s latest meeting reinforced those concerns. Policymakers indicated they could consider tightening monetary policy if inflation remained elevated.
“A majority of participants highlighted, however, that some policy firming would likely become appropriate if inflation were to continue to run persistently above 2 percent.”
Nvidia earnings in focus
Despite concerns over inflation and geopolitics, investors largely turned their attention toward Nvidia’s first-quarter earnings report due after the market close.
The chipmaker’s results are widely viewed as a key test of whether AI-related spending remains strong enough to justify elevated valuations across the technology sector.
Shares of Nvidia rose roughly 2% during the session and are already up about 20% this year after gaining more than 1,400% over the past five years.
Airlines rise as energy shares lag
The decline in crude prices helped lift airline stocks, including Delta Air Lines, United Airlines, Southwest Airlines, and Alaska Air.
Meanwhile, the energy sector lagged behind the broader market as oil prices dropped sharply.
Elsewhere, shares of Target fell after the retailer warned about a challenging macroeconomic environment despite raising its annual sales growth outlook.
Intuit also declined following a Reuters report that the company plans to cut about 3,000 jobs.
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