CoreWeave’s stock jumped 6.2% after Nvidia CEO Jensen Huang said the company’s cost of capital is falling, while the Dow added 550 points, the S&P 500 rose 0.3% and Nasdaq edged up 0.1% from a 1.4% dip.
Nvidia, holding roughly a 10% stake, is the second‑largest shareholder in CoreWeave, a fact that helped anchor the rally after the AI‑stock sell‑off that began earlier in the week.
Despite the rally, risk‑laden debt metrics loom large: a 60% default probability is priced into Credit Default Swaps, and the yield on CoreWeave’s 9.75% 2031 bond spiked to 15.78%, with swap spreads breaching typical distress thresholds.
The rebound comes amid broader AI and semiconductor volatility; memory‑chipmakers such as AMD, SanDisk, Western Digital and Seagate posted losses earlier in the session but began to recover, echoing the sentiment that AI demand remains robust but uneven across the supply chain.
Looking ahead, investors will monitor the Federal Reserve’s stance as Fed Chair Kevin Warsh engages in a fireside chat with IMF Managing Director Kristalina Georgieva. Inflation data show the September PPI up 1.3% month‑on‑month and 6.3% year‑on‑year, pushing the probability of a 25‑basis‑point rate hike in October to 28%. CoreWeave’s next earnings call is slated for late November, where analysts will weigh the company’s capital structure and growth prospects.