“We are all now connected by the Internet, like neurons in a giant brain.”

— Stephen Hawking

DAILY RECAP

Tuesday, October 27th

Stocks Extend Their Gains

Chip stocks led a tech fueled rally

S&P 500 – 7,722.60 (+0.60%)

Dow Jones – 52,377.57 (+0.03%)

NASDAQ – 26,477.81 (+1.18%)

TOP HEADLINES OF THE DAY

• AI Stocks Drive Wall Street Higher: Nvidia’s planned $3 billion investment in Meta reinforces investor enthusiasm for the expanding AI infrastructure market.
• Oil Retreats as Hopes for De-Escalation Grow: Lower crude prices ease some pressure on markets amid developments surrounding Middle East tensions.
• Fed Decision Takes Center Stage: Investors prepare for the latest policy announcement as expectations for another rate hike have fallen sharply.
• Economic Data Signals Business Investment Strength: Durable goods orders rose 1.8% in September, with core orders extending their recent gains.

STOCKS MAKING MOVES

• Nvidia (NVDA) and Meta (META): The companies deepened their AI partnership as Nvidia committed $3 billion to Meta’s equity offering.
• UPS (UPS): Shares rose after the delivery company increased its full-year revenue and adjusted earnings outlook.
• JetBlue (JBLU): The airline rallied as resilient demand and stronger-than-expected revenue helped offset a wider quarterly loss.
• Broadcom (AVGO): Shares advanced following an upgrade from D.A. Davidson to Buy from Neutral.
• Corning (GLW), Lumentum (LITE) and Ciena (CIEN): Optical networking stocks benefited from strength in Corning’s earnings and optical communications business.
• Royal Caribbean (RCL): Shares climbed after the cruise operator beat earnings estimates and reported 9% revenue growth.
• Boeing (BA): The stock slipped after the company reported a wider-than-expected quarterly loss despite stronger-than-forecast revenue.
• Moderna (MRNA): Shares fell after William Blair downgraded the stock to Market Perform from Outperform.

MARKET NOTABLES

• Semiconductors Lead the Rally: Chip stocks extended their rebound as renewed enthusiasm around AI and Anthropic’s IPO filing lifted sentiment toward the sector.
• AI Financing Faces Greater Scrutiny: Meta’s massive equity raise highlights the growing cost of AI expansion and questions over how technology giants will finance future spending.
• Oil Prices Ease: Crude declined amid hopes for progress toward easing Middle East tensions, offering some relief from energy-cost pressures.
• Earnings Season Remains Resilient: Early results have largely exceeded expectations, helping support equities as investors assess whether strong corporate profits can sustain the rally.
• Treasury Yields Stay Elevated: The 10-year Treasury yield hovered near 5%, keeping borrowing costs and the financing needs of AI companies in focus.
• Consumer and Travel Businesses Show Strength: Results from UPS and Royal Caribbean pointed to encouraging demand trends, although fuel expenses and operating costs remain important risks.

WHAT TO WATCH

The upcoming Fed decision remains in focus. Another catalyst for tech investors arrives Wednesday, when Alphabet (GOOGL) and Microsoft (MSFT) report their third quarter results.

October 28: FOMC rate decision and expected earnings from Microsoft (MSFT), Alphabet (GOOGL), T-Mobile (TMUS), ServiceNow (NOW), GE Vernova (GEV), Amphenol (APH), UBS (UBS), Phillips 66 (PSX), and Vertiv (VRT).
October 29: Third quarter GDP—first estimate, September PCE prices, September core PCE prices, ECB rate decision, and expected earnings from Amazon (AMZN), Eli Lilly (LLY), Intel (INTC), Sandisk (SNDK), Gilead Sciences (GILD), Mastercard (MA), Merck (MRK), Caterpillar (CAT), Shell (SHEL), Anheuser-Busch Inbev (BUD), Bristol-Myers Squibb (BMY), Altria (MO), Stryker (SYK), Starbucks (SBUX), and Mondelez (MDLZ).
October 30: BoJ rate decision and expected earnings from ExxonMobil (XOM), AbbVie (ABBV), Chevron (CVX), BP (BP), Sanofi (SNY), and General Dynamics (GD).
November 2: September construction spending, October ISM Manufacturing PMI®, and expected earnings from Apple (AAPL), Palantir (PLTR), Marriott International (MAR), Entergy (ETR), Idexx Labs (IDXX), Estee Lauder (EL), Vertex Pharmaceuticals (VRTX), Diamondback Energy (FANG), On Semiconductor (ON), and Roku (ROKU).
November 3: September factory orders and expected earnings from Advanced Micro Devices (AMD), Shopify (SHOP), Pfizer (PFE), Amgen (AMGN), Eaton (ETN), Marathon Petroleum (MPC), Arista Networks (ANET), Booking Holdings (BKNG), Block (XYZ), and American International Group (AIG).