(Updates to afternoon, adds analyst comment )

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Indexes up: Dow 0.88%, S&P 500 0.19%, Nasdaq 0.11%

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Traders fully price in 25 bps Fed rate cut in September

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Fed cut seen near certain after inflation data, Bessent

comments

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CoreWeave ( CRWV ) falls after larger-than-expected Q2 net loss

By Saeed Azhar, Johann M Cherian and Sanchayaita Roy

NEW YORK, Aug 13 (Reuters) - The benchmark S&P 500 and

Nasdaq hovered near record highs on Wednesday, but the market

reflected weakness in some technology stocks after the previous

day's strong gains on hopes that the Federal Reserve was getting

close to a monetary easing cycle.

Signs that U.S. tariffs on imports have not fully filtered into

headline consumer prices came as a relief for investors this

week as they scour for insight on the impact of trade

uncertainty on the economy.

Some large technology stocks including Nvidia ( NVDA ), Alphabet

and Microsoft ( MSFT ) - among the so-called

Magnificent Seven stocks - were lower as investors searched for

new growth drivers.

"Valuations are elevated. I do think, though, at the end of

the day, the key will be the delivery of earnings, and that's

what we're seeing," said Katherine Bordlemay, co-head of client

portfolio management, fundamental equities at Goldman Sachs

Asset Management.

She said the dispersion of stock-level returns in the U.S.

is at one of the higher levels of the last 30 years.

At 2:23 p.m. EDT, the Dow Jones Industrial Average

rose 391.83 points, or 0.88%, to 44,850.44, the S&P 500

gained 12.63 points, or 0.19%, to 6,458.25 and the Nasdaq

Composite gained 22.78 points, or 0.11%, to 21,704.69.

The blue-chip Dow was within 1% of an all-time high and the

Russell 2000 index, which tracks rate-sensitive small-cap

companies, added 1.4% to hit a six-month high.

Traders are now fully pricing in a 25 basis-point interest

rate cut, according to the CME's FedWatch Tool. The central bank

last lowered borrowing costs in December.

Treasury Secretary Scott Bessent said on Wednesday he thought an

aggressive half-point cut was possible, given recent weak

employment numbers.

Investors were also taking notice of other sectors following

the recent tech-led rally in U.S. stocks that has pushed

valuations of the S&P 500 above long-term averages.

Healthcare stocks, which have been beaten down for

much of the year, led gains among the 11 S&P 500 sectors, with a

1.2% rise.

Chicago Federal Reserve President Austan Goolsbee said on

Wednesday the U.S. central bank is grappling with understanding

whether tariffs will push up inflation just temporarily or more

persistently, which would inform its decision on when to cut

interest rates.

CoreWeave ( CRWV ), which is backed by Nvidia ( NVDA ), slumped

17% after the AI data center operator reported a

bigger-than-expected quarterly net loss.

Eyes were also on developments surrounding the China

revenue-sharing deal the U.S. government signed with top

chipmakers, which the White House said could be expanded to

others in the sector.

Paramount Skydance ( PSKY ) jumped 38%. The company won

exclusive broadcasting rights to the Ultimate Fighting

Championship for seven years earlier this week.

In geopolitics, traders were keen on a meeting between U.S.

President Donald Trump and Russian President Vladimir Putin on

the war in Ukraine, scheduled on Friday.

Advancing issues outnumbered decliners by a 3.18-to-1 ratio

on the NYSE. There were 549 new highs and 47 new lows on the

NYSE.

On the Nasdaq, advancing issues outnumbered decliners by a

2.27-to-1 ratio.

The S&P 500 posted 37 new 52-week highs and two new lows

while the Nasdaq Composite recorded 140 new highs and 55 new

lows.