Stocks rise as SpaceX jumps 8% on 161% revenue growth and Tesla merger talk

SpaceX said third-quarter revenue grew 161%, and its stock jumped 8% on Wednesday as CEO Elon Musk disclosed that special committees at both SpaceX and Tesla $TSLA are now weighing a possible combination.

U.S. stocks started the session in positive territory, and the Nasdaq $NDAQ Composite paced the advance. The S&P 500 rose 0.2% and the Nasdaq gained 0.5%, while the Dow Jones Industrial Average showed little movement.

SpaceX stock traded at $159.73, up $11.94. SpaceX outperformed analyst forecasts for sales, a tally that also counted income from its artificial-intelligence unit, according to The Wall Street Journal. A merger would combine the two biggest companies Musk runs and create the largest transaction on record, according to The Wall Street Journal.

Tesla stock rose more than 3% ahead of its earnings report.

The SpaceX results lifted sentiment around artificial intelligence. Nvidia $NVDA stock gained 1.8% after CEO Jensen Huang pitched new tools designed to help companies bring AI infrastructure online sooner, according to The Wall Street Journal. Samsung Electronics and SK Hynix each saw their South Korean shares advance by upward of 5%.

Hedge-fund billionaire Ken Griffin warned that there are "almost certainly bubbles" within the broader AI rally, according to The Wall Street Journal.

Netflix $NFLX stock fell more than 5% after the company cut its full-year ad revenue guidance. Its outlook for sales over the whole year fell short of what analysts had projected, according to CNBC.

Meta $META Platforms will release its results once trading closes on Wednesday, according to CNBC. IBM $IBM and Southwest Airlines are also due to report results Wednesday, according to CNBC. U.S. Treasury yields edged lower.