IBM profit warning sparks 25% plunge; US stocks climb on cooler inflation

IBM’s shares fell more than 25% after the company issued a profit warning for its second‑quarter earnings, marking the steepest one‑day loss on record for the tech giant. The drop weighed on the Dow Jones Industrial Average, which closed virtually unchanged, while the broader market rose.

The S&P 500 gained 0.38% to 7,543.59 and the Nasdaq Composite rose about 0.9% to 26,107.01, buoyed by better‑than‑expected earnings from major banks such as JPMorgan Chase, Goldman Sachs and Bank of America. U.S. consumer‑price data showed the CPI down 0.4% month‑over‑month and 3.5% year‑over‑year, well below the forecast of 3.8%. The softer inflation lowered the probability of a Federal Reserve rate hike in July to 17% from 42%, easing market expectations.

Higher oil prices, driven by renewed tension in the Strait of Hormuz, also featured in the trading narrative. Analysts quoted Skyler Weinand noting that “the lower‑than‑expected inflation suggests the surge caused by the Iran war is easing, but the relief may be temporary.”