Stocks edge higher as VIX drops and small caps lead

The big picture. U.S. stocks close higher across the board. The S&P 500 rises 0.5% to 7,666.6, the Nasdaq adds 0.5% to 26,217.8, the Dow gains 0.6% to 53,061.9, and the Russell 2000 jumps 1.1% to 2,953.2. Small caps outperform, while the Cboe Volatility Index falls 7.0% to 15.2 and the VIX 9-day drops 25.4% to 12.57.

Sector action is mixed but tilted positive. Materials lead with a 1.7% gain, followed by communication services at 1.4% and financials at 0.8%. Real estate is the laggard, down 0.7%, while tech is flat at -0.0%.

The day’s headlines keep circling AI, chips, and rates. CNBC reports Broadcom gives a weak current-quarter revenue forecast even as it talks up long-term AI growth, while Dell surges after lifting its fiscal 2027 forecast on AI server strength. CNBC also says Microsoft will begin disclosing Azure quarterly revenue, adding more detail to one of the market’s most-watched growth engines.

Overseas markets are softer. The Nikkei falls 0.2%, Hang Seng drops 0.9%, Shanghai slips 0.2%, the DAX loses 1.1%, and the Stoxx 600 falls 0.6%. Brazil’s Bovespa stands out on the upside, rising 3.1%. Crypto is mixed too, with total market value down 2.6% to $2.6T. Bitcoin slips 0.4% to $77,122.3, Ethereum falls 1.4% to $2,383.5, and Solana edges lower 0.2% to $99.75.