A new infrastructure deal for a chipmaker and an acquisition between regional banks combined to boost markets Monday. The leader of the AI revolution was left out of the rally, though, and the naming of a new CEO invited fresh questions from investors about the future of the biggest U.S. telecommunications company by subscriber base.
Seven of the 11 official stock market sectors closed in the green, led by consumer discretionary and communication services stocks. Real estate and consumer staples stocks lagged during a broadly positive day for many but a particularly tough session for some names.
"October got off to a bullish start as traders looked past the government shutdown and the economic data vacuum it created," according to E*TRADE Managing Director Chris Larkin.
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As Larkin notes, the earnings calendar won't fill up until next week, though "traders may take their cues" from companies such as Delta Air Lines (DAL, +1.8%) and PepsiCo (PEP, -1.6%), both of which report third-quarter results before Thursday's opening bell, as well as commentary from multiple Federal Reserve officials.
This week's economic calendar includes the release of the minutes from the September Fed meeting on Wednesday. Among other Fed speakers, we'll hear from recently confirmed Fed Governor Stephen Miran twice on Tuesday and Fed Chair Jerome Powell on Thursday.
Meanwhile, a decision by the Supreme Court means Lisa Cook will stay on the Fed board at least until January.
"While October has been one of the stronger months for stocks over the past three decades," Larkin says, it's also remained one of the most volatile. Even when the market has ended up at a bullish destination, the ride has sometimes been bumpy."
By Monday's closing bell, the blue-chip Dow Jones Industrial Average had rallied off its intraday lows and/but ended the day down 0.1% to 46,694, ending a six-session winning streak.
The broad-based S&P 500 Index added 0.4% to 6,740, reaching another new all-time closing high in the process. And the tech-heavy Nasdaq Composite was up 0.7% to 22,941, rising to its own fresh new high.
AMD stock gets a big OpenAI bounce
Advanced Micro Devices (AMD, +23.7%) and ChatGPT operator OpenAI announced a deal to collaborate on the construction of AI data centers to be run on AMD chips, and AMD stock soared as much as 37.6% Monday.
Semiconductor stocks, as represented by the iShares Semiconductor ETF (SOXX, +3.0%), were broadly higher for the day.
"We are in a phase of the build-out where the entire industry's got to come together and everybody's going to do super well," OpenAI CEO Sam Altman said. "You'll see this on chips. You'll see this on data centers. You'll see this lower down the supply chain."
Nvidia (NVDA, -1.1%) was down as much as 2.3%, its dominant position in the ongoing AI infrastructure buildout somewhat undermined by AMD's big announcement.
Verizon has a new CEO
Verizon Communications (VZ, -5.1%) was the biggest drag on the Dow after it said Daniel Schulman will replace Hans Vestberg as CEO effective immediately. The large-cap stock was down as much as 5.3% at its intraday low.
Schulman, currently an independent lead director for Verizon, is the former CEO of Paypal Holdings (PYPL, +3.0%). Vestberg will remain as a special adviser until October 4, 2026.
VZ stock is up 15% so far in 2025, but its longer-term trend isn't as encouraging. Indeed, Verizon has shed more than 30% over the last five years, as the telecom has struggled to stave off efforts by AT&T (T, -4.4%) and T-Mobile US (TMUS, -2.3%) to poach its home internet and mobile phone customers.
"Verizon is at a critical juncture," Schulman said in a statement. "We have a clear opportunity to redefine our trajectory, by growing our market share across all segments of the market, while delivering meaningful growth in our key financial metrics."
A regional bank gets bigger
Comerica (CMA, +13.7%) rose as much as 18% on news it will be acquired by fellow regional bank Fifth Third Bancorp (FITB, -1.4%) in a deal that will expand the footprint for one of the best bank stocks to buy.
The $10.9 billion all-stock transaction is expected to close by the end of the first quarter of 2026. It would create the ninth-largest U.S. bank with approximately $288 billion in assets.
CMA shareholders will receive 1.87 FITB shares per each CMA share they own, representing $82.88 per share as of Fifth Third's closing price on Friday, October 3, and a 20% premium to CMA's 10-day volume-weighted average stock price. Management expects the deal to be immediately accretive to earnings per share.
CFRA Research analyst Alexander Yokum said the acquisition provides significant scale benefits and strengthens Fifth Third's commercial banking operations.
The analyst notes concerns about Comerica's "operational challenges," including stagnant loan growth as well as elevated deposit costs, and geographic concentration in Michigan and California.
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