US Stocks Close: Mild CPI Eases Rate Hike Concerns, SOX Surges Nearly 2.5%, Memory Stocks Soar

US inflation cooled slightly in July, strengthening expectations that the Federal Reserve will hold interest rates steady in September. Bolstered by strong gains in AI infrastructure and memory-related stocks, US equities closed mostly higher on Wednesday (12th). The Philadelphia Semiconductor Index surged nearly 2.5%, the Nasdaq Composite rose 0.54%, the S&P 500 gained 0.26%, while the Dow Jones Industrial Average ended nearly flat.

The US Consumer Price Index (CPI) rose 3.4% year-over-year in July, in line with market expectations and down from June’s 3.5%. On a month-over-month basis, it increased by 0.1%. With inflation continuing to ease, traders have shifted toward betting on a Fed hold in September, reversing the previous day’s near-even odds between a hike and a pause.

However, US inflation remains above the Fed’s 2% target. Ongoing Middle East tensions continue to push up energy prices and US Treasury yields, leading to divergent views among Fed officials on whether to raise rates.

Negotiations between the US and Iran over reopening the Strait of Hormuz remain stalled. On Tuesday, the US fired upon a vessel attempting to cross the Gulf of Oman flying the Panamanian flag, further intensifying market concerns about crude oil supply. Brent crude futures briefly approached $90 per barrel.

Rising oil prices have also pushed up US gasoline prices. The national average for regular gasoline rose to $4.03 per gallon on Wednesday, up about $0.16 from a month ago, marking a new high for mid-August levels in recent years.

Major US stock indices on Wednesday (August 12):

- Dow Jones Industrial Average: Down 21.58 points, or 0.04%, at 53,770.27 - Nasdaq Composite: Up 143.04 points, or 0.54%, at 26,588.49 - S&P 500 Index: Up 20.30 points, or 0.26%, at 7,748.50 - Philadelphia Semiconductor Index: Up 300.90 points, or 2.49%, at 12,399.38 - NYSE FANG+ Index: Down 104.74 points, or 0.56%, at 18,474.70

Key individual stocks:

All five tech giants in the NYSE FANG+ Index declined. Meta (META-US) fell 3.38%; Apple (AAPL-US) dropped 0.87%; Alphabet (GOOGL-US) edged down 0.08%; Microsoft (MSFT-US) fell 2.26%; Amazon (AMZN-US) declined 1.83%.

Most Philadelphia Semiconductor Index components closed higher. AMD (AMD-US) rose 1.82%; Broadcom (AVGO-US) dipped slightly by 0.01%; Nvidia (NVDA-US) gained 3.03%; Applied Materials (AMAT-US) surged 4.29%; Qualcomm (QCOM-US) rose 0.24%.

Memory and storage stocks advanced together. Micron Technology (MU-US) jumped 4.92%; Western Digital (WDC-US) rose 3.69%; SanDisk (SNDK-US) soared 5.76%; Seagate Technology (STX-US) surged 7.03%; SK Hynix ADR (SKHY-US) skyrocketed 9.01%.

Taiwan-related ADRs were mostly up. TSMC ADR (TSM-US) rose 1.68%; ASE ADR (ASX-US) gained 1.63%; UMC ADR (UMC-US) climbed 1.95%; China Telecom ADR (CHT-US) edged down 0.12%.

Corporate news:

Wendy's (WEN-US) surged 14.70% to $8.66 per share. The UK's Financial Times, citing sources, reported that billionaire investor Nelson Peltz's Trian Fund Management is preparing a takeover offer to take Wendy's private.

Super Micro Computer (SMCI-US), a global leader in AI servers, skyrocketed 19.02% to $37.61 per share. Its fourth-quarter results beat expectations, and it issued an optimistic first-quarter outlook, signaling continued robust demand for AI servers.

CoreWeave (CRWV-US), an AI cloud computing company, surged 19.28% to $107.73 per share. Its adjusted operating margin reached 5% in Q2, exceeding market expectations, with revenue more than doubling year-over-year.

Nebius Group (NBIS-US) rose over 34% to $259.20 per share. This AI infrastructure firm reported pre-tax EBITDA and revenue both above analyst consensus from FactSet, with gross margins also surpassing estimates.

Lumentum Holdings (LITE-US) surged 13.63% to $932.47 per share. Both adjusted EPS and revenue exceeded market expectations. Riding the AI boom, Lumentum's stock has risen over 100% year-to-date.

Wall Street analysis:

Following the CPI release, market expectations for a Fed rate hold in September intensified.

Ellen Zentner, Chief Economic Strategist at Morgan Stanley Wealth Management, said the in-line inflation data extends the 'no need to hike' narrative formed after last week’s employment report. While another inflation print precedes the September FOMC meeting, unless the numbers show a dramatically different trend, the Fed is likely to keep rates unchanged next month.

(All figures are updated as of press time; actual quotes may vary.)