Nasdaq 100 Sees Best Day In Nearly A Month As AI Rout Cools — AMZN, BE, CRWV, AAPL, PLTR In Focus

• The S&P 500 ended Monday 0.4% higher, the Nasdaq 100 added 1.2%, and the Dow Jones Industrial Average slipped 0.1%.
• CoreWeave extended last week’s weakness, down 0.4%.
• Meta Platforms and Tesla are scheduled to report earnings this week.

The Nasdaq 100 recorded its best day in nearly a month on Monday as investors returned to the AI play following a week-long rout that sent most AI infrastructure stocks tumbling. 

The S&P 500 ended Monday 0.4% higher, the Nasdaq 100 added 1.2%, and the Dow Jones Industrial Average slipped 0.1%. The Russell 2000, which tracks small-cap stocks, ended 0.3% higher.

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Dow Jones Industrial Average futures traded 56 points higher, or 0.1%. S&P 500 futures climbed 0.1%, and Nasdaq-100 futures were up as well at the time of writing.

The SPDR S&P 500 ETF (SPY) rose 0.4%, and the SPDR Dow Jones Industrial Average ETF (DIA) was flat. Meanwhile, the Nasdaq-100 tracking Invesco QQQ Trust (QQQ) added 1.2% on Monday.  

Meanwhile, the VanEck Semiconductor ETF (SMH) and the iShares Semiconductor ETF gained little over 2% amid gains in Micron Tech (MU), Nvidia (NVDA), Broadcom (AVGO), and most other silicon makers. The broader Vanguard Information Technology ETF (VGT) dropped 1.5%.

Retail sentiment on Stocktwits for SPY and DIA was ‘bearish’ with ‘high’ message volumes, while sentiment improved to ‘neutral’ from ‘bearish’ for the QQQ.

US Market Drivers

The S&P 500 shed almost 2% last week, marking its sharpest seven-day drop since late June. Meanwhile, the Nasdaq dropped 4.5%, breaking a four-week rally. 

Anxieties surrounding the AI trade escalated following CNBC reports that Anthropic generated $16.8 billion in Q3 sales. Although this is up from $11.6 billion in Q2, traders expressed reservations about the sustainability of the AI expansion.

Corporate bond investors began pulling back from CoreWeave, pushing its credit default swaps into distressed territory.

Moreover, a report from Gartner that alarmed that 80% of the neocloud market would cease to exist on account of revenues not justifying current capex spends, added to market anxiety. 

However, tech stocks at large recovered on Monday with the Philadelphia Semiconductor Index (SOX) up about 1.6%. 

Going forward, investor attention will focus on Meta Platforms (META) and Tesla (TSLA) earnings this week to gauge the overall pace of growth in the wider AI space. 

“Results will show whether strong profit growth can restore confidence in the equity rally,” said Mark Haefele at UBS Chief Investment Office told Bloomberg. “We continue to expect resilient growth and earnings to support equities, and see attractive opportunities in quality bonds.” 

Key Trending Stocks

Bloom Energy share price added about 3% on Monday after Oracle, in a post on X, signaled a fast-paced improvement in data center Project Jupiter.  

Artificial intelligence developer Anthropic PBC is in advanced discussions to acquire roughly $45 billion in computing power from Nvidia-backed cloud infrastructure firm Nscale, Bloomberg reported. 

Amazon.com Inc. (AMZN) share price rose nearly 5% on Monday and was on-track to record its best day in nearly three months after Morgan Stanley reaffirmed its ‘Overweight’ recommendation on the stock and hiked its share price target.  

Apple Inc. (AAPL) on Monday confirmed an Oct. 28 product launch event in Los Angeles, where the company is expected to unveil its first touchscreen MacBook Pro, marking a major shift in its longstanding approach to laptop design. 

Palantir Technologies (PLTR) shares gained in midday trade on Monday after the company announced it had partnered with Knox Systems to help commercial software companies deploy applications in secure U.S. government and defense environments. 

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