The S&P 500 briefly hit 6,100 points on Wednesday, reaching a fresh all-time high as Wall Street embraced a powerful mix of strong corporate earnings and President Donald Trump's bold $500 billion artificial intelligence initiative, dubbed “AI Stargate.”
The project, designed to transform America's AI infrastructure, added fuel to a market already cheering on stronger-than-expected fourth-quarter earnings and rising hopes of Federal Reserve interest rate cuts later this year.
Mega-cap technology stocks and semiconductor giants led the charge, pushing the S&P 500 — tracked by the SPDR S&P 500 ETF Trust SPY — higher for the sixth time in the last seven sessions.
By midday Wednesday, the S&P 500 hit 6,100.4 points, narrowly surpassing its previous record of 6,099 set on Dec. 6.
AI Stargate: A Game-Changing Investment in AI Infrastructure
Trump unveiled AI Stargate on Jan. 21. The joint venture unites OpenAI, led by Sam Altman, SoftBank, backed by Masayoshi Son, and Oracle Corp. ORCL to build next-generation AI infrastructure.
The project aims to invest up to $500 billion over four years to develop massive AI data centers across the U.S., starting with an initial $100 billion phase.
Trump hailed the initiative as a “declaration of confidence in America’s potential,” emphasizing its importance in keeping the future of AI technology within U.S. borders.
AI Stargate is expected to create 100,000 jobs almost immediately, further boosting optimism about economic growth.
Earnings Strength Fuels Market Optimism
While AI excitement dominated headlines, a strong corporate earnings season provided the foundation for the market’s rally.
As of Jan. 17, 81% of S&P 500 companies reporting fourth-quarter results had exceeded Wall Street's profit forecasts, while 64% had beaten revenue estimates, according to FactSet.
Mega-cap firms reporting earnings this week — including Netflix Inc. NFLX, Charles Schwab Corp. SCHW, Prologis Inc. PLD, Procter & Gamble PG, Abbott Laboratories ABT, and Johnson & Johnson JNJ — all topped estimates, reinforcing investor confidence in corporate America’s strength.
“The S&P 500's forward profit margin was at a record-high 13.6% during the January 18, 2025, week, up 0.9 percentage points from 12.7% a year earlier,” veteran investor Ed Yardeni said in a note Wednesday.
“Corporate profitability should continue to improve even as Trump's administration faces a big fiscal headwind.”
Tech Titans Drive The Market Higher
The so-called “Magnificent 7” stocks were at the center of Wednesday's rally, with the Roundhill Magnificent Seven ETF MAGS climbing 1.5%.
Microsoft Corp. MSFT surged 4%, while Nvidia Corp. NVDA jumped 4.6%, reinforcing their dominance in the AI race. Chip stocks saw particularly strong gains as investors bet on increased demand for AI-related infrastructure.
Arm Holdings plc ARM, the SoftBank-owned semiconductor design firm, soared 15%—its biggest single-day gain since February 2024.
SoftBank's 2024 annual report had described Arm as providing “the foundational technology for Artificial Super Intelligence,” a claim that now appears increasingly relevant as AI Stargate takes shape.
Six Stocks Powering The S&P 500's Record High
Just a handful of companies were responsible for a significant portion of the broader market's surge on Wednesday.
Nvidia and Microsoft alone contributed 53 basis points to the S&P 500’s advance, while Netflix, Amazon.com Inc. AMZN, Meta Platforms Inc. META, and Oracle Corp. collectively added another 18 basis points.
| Security Name | Price | Weight in S&P 500 | 1-day %chg | Contribution to S&P 500 |
|---|---|---|---|---|
| Nvidia Corp. | $1,472.46 | 6.51% | 4.55% | +29bp |
| Microsoft Corp. | $445.37 | 6.27% | 3.94% | +24bp |
| Netflix Inc. | $952.64 | 0.72% | 9.54% | +6bp |
| Amazon.com Inc. | $233.46 | 4.10% | 1.19% | +5bp |
| Meta Platforms Inc. | $626.13 | 2.65% | 1.57% | +4bp |
| Oracle Corp. | $184.92 | 0.51% | 7.15% | +3bp |
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