US stocks rise after data shows slowing inflation, even as IBM plunges
[July 15, 2026] By
STAN CHOE
NEW YORK (AP) — Stocks rose Tuesday after a report showed U.S. inflation
was not as bad last month as economists expected. That was even though
oil prices continued to climb on worries that the United States and Iran
may return to all-out war.
The S&P 500 added 0.4% to recover some of its 0.8% loss from the prior
day. The Dow Jones Industrial Average added 9 points, or less than 0.1%,
and the Nasdaq composite climbed 0.9%.
Stocks got help from easing yields in the bond market, which fell after
a report said U.S. consumers had to pay prices for gasoline, food and
other costs of living that were 3.5% higher last month than a year
earlier. That wasn’t as bad as May’s 4.2% inflation rate or the 3.9%
that economists expected for June.
Less bad inflation takes pressure off the Federal Reserve, which is
considering raising interest rates. Higher rates would keep a lid on
inflation, but they also slow the economy and hurt prices for all kinds
of investments.
Following the inflation report, traders see less than a 17% chance that
the Fed will raise its main interest rate at its next meeting in a
couple weeks. That’s down from the nearly 42% probability they saw the
day before, according to data from CME Group.
Rebounds for big, influential tech stocks also helped steady the market.
They’ve swung sharply in recent weeks on worries that they shot too high
in the euphoria around artificial-intelligence technology and that the
voracious demand for AI chips and data centers may fade if they don’t
produce the promised profits and productivity.
Micron Technology rose 4.9%, and Nvidia climbed 4.1%. A day before, they
were two of the heaviest weights on the S&P 500 after falling 4.4% and
3.5%, respectively.
To be sure, big risks remain for inflation. Fighting in the Middle East
is threatening to close the Strait of Hormuz, the narrow waterway that
oil tankers use to exit the Persian Gulf and deliver crude to customers
worldwide.
The price for a barrel of Brent crude, the international standard,
briefly topped $87 in the morning. Following its leap of nearly 10% on
Monday, it got back to where it was before the United States and Iran
signed their interim deal to halt their fighting in the middle of last
month.
Brent’s price later pared its gain and settled at $84.73, up 1.7% from
Monday’s settlement. It eased after Donald Trump backed away from his
threat made Monday to charge 20% on all cargo going through the strait
to reimburse the U.S. military for its protection.
Wall Street’s other big focus this week is the start of earnings
reporting season, as companies tell investors how much profit they made
from April through June. The pressure is on companies to deliver big
growth to justify how high their stock prices have jumped. Indexes are
near records despite the recent swings caused by worries about AI
stocks.
Bank of America, Citigroup, JPMorgan Chase, Goldman Sachs and Wells
Fargo all on Tuesday reported fatter profits for the latest quarter than
analysts expected. Their reports showed strength for their trading desks
and suggested spending by U.S. consumers remains resilient.
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Patrick McKeon works on the floor at the New York Stock Exchange in
New York, Monday, July 6, 2026. (AP Photo/Seth Wenig)
 Their stocks mostly rose following
the results. Goldman Sachs jumped 9%, but Citigroup fell 5.3%.
IBM was the heaviest weight on the S&P 500 and the biggest reason
the Dow lagged behind other indexes after dropping 25.2%. That was
its worst day since at least 1972, according to data provider
FactSet.
CEO Arvind Krishna said performance for IBM’s software and
infrastructure businesses fell short of expectations last quarter
after customers shifted their spending toward servers, storage and
memory to get ahead of expected price increases caused by the AI
boom.
“These conditions require our teams to execute perfectly, and this
quarter we faltered,” Krishna wrote in a letter to investors. “We
did not adapt and move quickly enough, and numerous large deals
failed to close on the timelines we expected, driving the majority
of our shortfall.”
All told, the S&P 500 rose 28.25 points to 7,543.59. The Dow Jones
Industrial Average added 9.63 to 52,508.27, and the Nasdaq composite
climbed 233.83 to 26,107.01.
In the bond market, the yield on the 10-year Treasury dropped to
4.58% from 4.62% late Monday. That halted its run higher from 3.97%
before the war with Iran began.
Fed Chairman Kevin Warsh testified before lawmakers on Capitol Hill
for the first time since taking over leadership of the central bank.
He pledged to make high inflation “a thing of the past” but offered
no signal about the Fed’s next steps.
In stock markets abroad, indexes inched higher in Europe following a
stronger finish in Asia.
Japan’s Nikkei 225 added 0.7% as SoftBank Group Corp. rose 3.3%.
It’s a big investor in AI, and Chairman Masayoshi Son gave a speech
in Tokyo where he derided the idea that there is a bubble in
investments in capacity for AI.
Stocks rose 1.4% in Shanghai after the government reported China’s
exports jumped 27% in June from a year earlier as AI drove strong
demand for computer chips and other technology.
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AP Business Writer Elaine Kurtenbach contributed to this report.
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