The Nasdaq Composite reversed an early gain on Monday as technology stocks fell again, extending last week's sell-off. New debt raises from AI hyperscalers kept pressure on the sector, while investors watched Apple's earnings and Tuesday's midterm elections.
The tech-heavy NASDAQ Composite was down 0.4% to 25,329.99 points at 14:34 ET, reversing a jump of as much as 1.4%. The S&P 500 slipped 0.1% to 7,572.54 points after climbing as much as 1.1%. The Dow Jones Industrial Average rose 0.7% to 52,115.90 points.
Oracle's offering weighed on the AI trade. It became the latest AI hyperscaler to announce a $10 billion stock offering alongside a $10 billion bond offering.
October's AI sell-off pushed money into defensive sectors
The Nasdaq slumped 2.9% on Friday, its worst day since early June, and fell over 5% for October, its worst month since March 2025. The S&P 500 lost 0.9% for the month, while the Dow gained 1.7%.
Quarterly reports from some of the biggest AI names failed to lift the mood. Meta Platforms delivered negative free cash flow for the first time in over a decade. Alphabet posted its worst intraday drop on record, losing roughly half a trillion dollars in market value. Microsoft completed a $25 billion bond offering for AI funding.
Investors rotated elsewhere. Consumer staples, utilities and health care jumped 11.4%, 10.1% and 9.7% in October, the top three S&P sectors. An equal-weighted version of the S&P 500 surged 4.9%.
Apple reports as oil slides
Apple reports after the closing bell. Its shares have climbed for four consecutive months and are up nearly 25% YTD, and trading desks treat the company as an oasis of capital restraint, the source says.
Oil offered some relief. Brent crude futures slid 7.6% to $104.81 a barrel on signs that Washington and regional intermediaries were exploring diplomatic options before considering further military escalation against Iran.
Midterms and jobs data come next
Voters head to the polls Tuesday, with all 435 House seats and 35 Senate seats on the ballot. Friday's October nonfarm payrolls report follows, as money markets price a 78% probability of a 25-basis-point interest rate hike in December.
Keith Lerner, chief investment officer at Truist, said an objective review of historical evidence suggests Washington's perceived influence on market returns is often overstated.
Source: Investing.com
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