A cooler-than-expected read on inflation gave Wall Street a lift on Wednesday, July 15, 2026 — and handed investors a rare bit of good news to chew on as second-quarter earnings season kicked into gear. But beneath the calm surface, the market split hard: AI-equipment champions soared while memory-chip makers and last month's hottest IPO went the other way.
Cooler inflation does the heavy lifting
The mood shift started a day earlier. June's Consumer Price Index, released Tuesday, fell a seasonally adjusted 0.4% from May and cooled the annual rate to 3.5% — well below the 0.2% monthly dip and 3.8% annual pace economists had penciled in. It was the largest single-month drop in inflation since April 2020. On Wednesday, the Producer Price Index piled on, showing wholesale prices slowing faster than expected too.
Two soft inflation prints in two days did something the market had been craving: they cooled fears that the Fed's new, guidance-light regime under Chair Kevin Warsh might have to hike rather than cut. By Wednesday afternoon the major averages were modestly higher — the S&P 500 up around 0.4%, the Nasdaq Composite up roughly 0.6%, and the Dow adding about 0.2% — with megacaps like Microsoft (MSFT), Nvidia (NVDA), Alphabet (GOOGL) and Apple (AAPL) doing much of the lifting.
ASML steals the show
The day's headliner was ASML (ASML), the Dutch giant that builds the machines every advanced chipmaker depends on. It reported second-quarter net sales of €9.3 billion, a 54% gross margin and €2.9 billion in net income — then raised its full-year 2026 sales outlook to €43–45 billion and said it will expand chipmaking-equipment capacity by 30% to keep up with AI demand. Shares jumped more than 7% in both Amsterdam and New York.
But the enthusiasm didn't spread evenly. Memory-chip makers had an ugly session: Micron Technology (MU) and Korea's SK Hynix each tumbled more than 7% as investors fretted about pricing pressure. It was a vivid reminder that "chips" is not one trade — the picks-and-shovels of AI can rally while commodity memory sinks on the very same afternoon.
Banks and pharma open earnings season
Earnings season officially arrived with a bang. Morgan Stanley (MS) posted record quarterly revenue and profit, earning $3.46 a share on $21.35 billion in revenue — crushing forecasts of $2.94 and $19.64 billion — and the stock ticked higher. Asset-management titan BlackRock (BLK) leapt about 7.7% on its own beat.
Not every beat was rewarded. Johnson & Johnson (JNJ) topped estimates with adjusted earnings of $2.90 a share on $25.31 billion in revenue, yet the stock slipped more than 1% — a classic "sell-the-news" shrug that often greets defensive names when risk appetite is running hot elsewhere. Curious which of your holdings report next? Keep tabs with our earnings calendar before the next batch lands.
SpaceX comes back to earth
The session's most symbolic move belonged to SpaceX, which slid below its $135 IPO price for the first time, falling around 2% to roughly $133. Elon Musk's rocket-and-satellite company is now down about a third from its post-listing peak, and the shine has faded fast since it disclosed a $4.9 billion net loss for last year. It's a sober counterpoint to the AI-infrastructure euphoria: even the buzziest debut can't outrun questions about the path to profit.
Elsewhere, Pentair (PNR) cratered more than 20% after the water-solutions company cut its guidance and disclosed the resignation of its finance chief — proof that a single downbeat revision can undo months of gains.
Bottom Line
Wednesday's tape told a clear story: cooler inflation is the tailwind, but the market is getting choosier about what it rewards. AI infrastructure (ASML) is still the belle of the ball, while commodity memory (Micron), pricey hype (SpaceX) and guidance stumbles (Pentair) get punished without mercy. With the Fed leaning less on hand-holding and earnings season only just beginning, expect the moves to stay sharp and headline-driven. Our take: stay invested, but lean toward quality and real earnings power — the market is done paying up for stories alone. Screen for durable names with our Stock Screener before the next print moves the tape.
This article is for informational purposes only and is not financial advice. Always do your own research before investing.
