Wall Street rises on SpaceX profit, Tesla merger talk

US stocks closed higher on Wednesday, October 21, after SpaceX reported its first profit as a public company. The gains pulled the S&P 500 ↗ 0.53% closer to the record high it set earlier this month. The S&P 500 rose 0.58% to 7,757.17, the Nasdaq Composite climbed 1.05% to 26,702.86, and the Dow Jones Industrial Average added 0.69%, The Korea Herald's business desk reported. SpaceX's results helped steady AI stocks, which had been shaken by worries that data center construction would slow as borrowing costs rise, the Associated Press reported.barchart.com+1

SpaceX earnings and merger comments

SpaceX shares closed up 7.8%. The company had reported its results after Tuesday's close. It posted third-quarter net income of $4.4 billion, compared with a $1.1 billion loss a year earlier, and analysts had expected a profit of $1.57 billion, according to Reuters. Revenue rose 161% to about $14.6 billion, driven by the company's AI unit, AFP reported.seekingalpha.com+2

On Tuesday's earnings call, Elon Musk said combining SpaceX with Tesla "would be a good idea, but it's really up to the special committees of both companies." It was the first official confirmation that the two companies were in formal talks. Musk warned that it would be premature to assume a deal would happen, since the committees have not agreed on terms. Tesla rose 3.4% ahead of its own earnings report after the close. Tesla and Meta Platforms ↗ 0.47% both moved higher in after-hours trading after their results beat expectations.fidelity.com+3

Chipmakers rise, Netflix and AT&T fall

Super Micro Computer ↗ 9.55% jumped more than 9% after it said it expects stronger revenue than it had earlier forecast, citing "increased demand for AI platforms". Nvidia ↗ 2.54% gained 2.5%. Capital One ↗ 2.53% also rose after its quarterly profit beat estimates.biz.heraldcorp.com+2

Netflix ↘ 5.31% fell about 5% after its revenue forecast came in below expectations. AT&T ↘ 6.45% slid roughly 6% after reporting weak growth in wireless phone accounts. CoreWeave ↘ 0.50% swung between a gain of nearly 4% and a drop of 4.5% before closing down 0.5%.barchart.com+1

Rising rates are still weighing on markets. The 10-year Treasury yield rose to about 5.14%, and Brent crude settled at $108.82 a barrel. "Sentiment around tech stocks has shifted, but significant pressure in credit markets is limiting a full-scale rally," said Mark Hackett, chief market strategist at Nationwide.theglobeandmail.com+1