Dow Rises Amid More Selling for AI Stocks: Stock Market Today
All three main equity indexes were up before the weight of a mostly risk-off mood for the AI trade dragged the Nasdaq Composite and the S&P 500 into the red.
Stocks were mixed on Monday, as an early across-the-board bounce for the main equity indexes softened during the second half of the trading session. There's renewed optimism about peace in the Persian Gulf, though investors, traders and speculators remain cautious about the AI trade.
According to Axios, President Donald Trump told Israel's Prime Minister Benjamin Netanyahu that he's open to diplomacy as a way out of the stalemate in the Middle East. In a separate but related development, the Islamic Republic News Agency (IRNA) said Supreme Leader Mojtaba Khamenei has permitted Iran's government to engage in peace negotiations.
The front-month West Texas Intermediate crude oil futures contract declined 8% to $95.84 per barrel, while Treasury yields were mixed, with the 2-year (+1.3 basis points, 4.594%) ticking higher, but the 10-year (-2.5 bps, 4.904%) and the 30-year (-2.9 bps, 5.28%) tracking lower.
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"The stock market's longer-term bullish narrative may have taken some hits in recent weeks, but it's still intact," E*TRADE from Morgan Stanley Managing Director Chris Larkin observes. "The challenge has been short-term momentum — stringing together more than a few days without being disrupted by surging oil prices, concerns about AI spending, inflation, or geopolitics."
By the closing bell, the blue-chip Dow Jones Industrial Average was up 0.4% to 51,983. But the broad-based S&P 500 had shed 0.5% at 7,541, and the Nasdaq Composite was down 1.1% to 25,164.
As Larkin notes, the market's "volatility triggers" this week include midterm elections on Tuesday and the October jobs report on Friday. "Its ability to bend but not break under pressure has been a positive sign," he concludes.
Who's bigger, Apple or Nvidia?
Apple (AAPL, -1.8%), which is reporting fiscal fourth-quarter earnings after the closing bell, went back and forth atop the global market cap leaderboard with Nvidia (NVDA, -1.3%), amid another down day for semiconductor stocks.
Amazon (AMZN, +2.2%) and Tesla (TSLA, +1%) and were well in the green on Monday, with some Magnificent 7 stocks catching bids despite general skepticism about the group.
Hyperscalers Alphabet (GOOGL, -0.3%), Meta Platforms (META, -1.3%) and Microsoft (MSFT, -2.8%), for example, lagged amid lingering concerns about capex, cash flow and return on AI investment.
Idexx Laboratories (IDXX, +21.9%) led S&P 500 stocks after management of the pet healthcare outfit reported better-than-expected third-quarter results and raised its full-year outlook.
Sherwin-Williams (SHW, +6%), meanwhile, was the top-performing Dow Jones stock, as materials, financials, industrials, consumer staples and real estate, as well as consumer discretionary stocks, rose more than 1%.
Note that a Nasdaq stock with significant AI exposure, Palantir Technologies (PLTR, -3.1%), joins iPhone maker Apple on the earnings calendar this evening.
Marvell is buying Lumentum
Marvell Technology (MRVL, -12.7%) will buy Lumentum Holdings (LITE, -18.6%) in a tie-up of tech stocks with "complementary electrical and optical capabilities" that will "address increasingly complex connectivity requirements across next-generation AI infrastructure."
Lumentum shareholders will receive 4.5 MRVL shares for each LITE share they own. The deal values LITE at approximately $1,132 per share, a premium of about 24% based on each company's closing price on October 28.
Marvell says its portfolio will span "leading-edge CMOS, silicon photonics, compound semiconductors, advanced packaging and manufacturing capabilities" and deliver "highly optimized connectivity solutions across a wide range of distances," including distributed data centers.
Management expects the transaction to boost revenue growth and margin expansion over the long term, with "line of sight to more than $1 billion in annual run-rate cost synergies."
It'll be bottom-line accretive in "year one post-close." But both MRVL and LITE were down double digits in the immediate aftermath of the deal's announcement, despite the AI optimism.
Anthropic reports revenue of $17 billion
Anthropic (ANT), on track to complete what could be the biggest initial public offering (IPO) in stock market history before Thanksgiving, reported third-quarter revenue of $16.96 billion in an updated registration statement filed with the Securities and Exchange Commission (SEC) on Monday.
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Top-line growth was about 1,127% on a year-over-year basis. But growth slowed quarter to quarter, to 47% from 144% in Q2 and 132% in Q1. Management of the self-described AI research and safety company reported a net loss of $23.29 billion.
Indeed, whether to buy ANT stock is a simple question with more complex ramifications as investors, traders and speculators continue to price the durability of the AI revolution.
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