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The Nasdaq Composite and S&P 500 fell on Monday, giving up earlier gains, as investors continued to move out of tech stocks and add exposure to other parts of the market.
The tech-heavy Nasdaq dipped 1.07% to end at 25,164.32, while the S&P 500 shed 0.51% to close at 7,541.40. Both benchmarks were up as much as 1.4% and 1.1%, respectively. The Dow Jones Industrial Average outperformed, rising 213.67 points, or 0.41%, to 51,983.98.
Shares of Nvidia and Meta Platforms each dipped 1%. Apple, which reports earnings after the bell, closed nearly 2% lower. Marvell Technology shares dropped almost 13%, while Lumentum shed 18% after the companies announced that Marvell is buying Lumentum in a $115 billion deal. Oracle shares also declined 8% after the company said it plans to sell $10 billion in common stock as well as $10 billion in bonds to finance its AI buildout.
Gains in so-called old economy stocks such as Sherwin-Williams and Home Depot powered the Dow, rising almost 6% and 3.6%, respectively. Honeywell International, 3M and Boeing were also up more than 2% each.
The rotation out of tech after the major U.S. stock benchmarks suffered a losing week, as investors continued to scrutinize names related to the AI buildout.
"The stock market's longer-term bullish narrative may have taken some hits in recent weeks, but it's still intact," said Chris Larkin, managing director of trading and investing at E-Trade. "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."
Last week, the tech-heavy Nasdaq and the S&P 500 logged a losing October amid AI spending concerns, with the Nasdaq suffering its worst losses since March 2025. The Dow, however, rose almost 2% as investors rotated into defensive areas like healthcare.
"The market has more potential 'volatility triggers' to face — including this week's midterms and jobs data — but its ability to bend but not break under pressure has been a positive sign," Larkin added.
The U.S. midterm elections will be held on Tuesday, when Democrats are expected to take control of the House of Representatives, while Senate control remains uncertain.
Meanwhile, Brent crude tumbled 7.63% to close at $104.77 per barrel. U.S. West Texas Intermediate futures also pulled back 7.36% to settle at $96.46 per barrel.
Oil prices fell amid hopes that the U.S. and Iran may resume peace talks, with Secretary of State Marco Rubio saying over the weekend that President Donald Trump "hasn't made a decision" to attack Iran and that Washington would prefer to resolve the conflict "peacefully." Iranian state media also reported that the country's foreign minister said an agreement with is possible if the U.S. "demonstrates goodwill."
Correction: An earlier version of this story misstated the move in oil prices in the session.
The S&P 500 and Nasdaq Composite finished in the red on Monday.
The broad market index shed 0.51% to close at 7,541.40, while the tech-heavy Nasdaq dropped 1.07% to 25,164.32.
The Dow Jones Industrial Average outperformed, adding 213.67 points, or 0.41%, to 51,983.98.
Stephens upgraded Oracle to overweight from equal weight on Monday.
"We believe the market needs to give Oracle more credit for the execution on delivering compute that continues to happen," wrote Analyst Brett Huff, who noted the company delivered about 850 MW in the first quarter across 38 projects in 11 countries.
Huff added it sees Oracle may reach "double-digit" multi-year growth in applications, higher than what Wall Street's 10% growth estimate.
The firm gave Oracle a $213 price target, implying a roughly 63% upside from Friday's close.
Check out some of the companies making the biggest moves midday:
Loop Capital is pulling down its rating on social media site Reddit to a hold from a buy. The investment bank has a price target of $100 on the stock.
The downgrade is due to pressures on referral traffic as AI supplants traditional internet searching at the dominant search engine Google. The bank also has concerns about mandatory log-ins for the site, monetization trends, and the prospects for Google's licensing deal with Reddit.
"It seems increasingly likely that Google does not renew its licensing agreement expiring early 2027," Rob Sanderson at Loop Capital wrote.
Google reported a significant dent in its core advertising revenues last week, leading to its largest single-day stock decline ever on Thursday.
Construction spending in September fell at its fastest monthly level since the Covid pandemic, weighed by a sharp drop in residential activity.
The Commerce Department reported Monday that the metric slipped 1.9% for the month, posting the biggest monthly decline since April 2020. On a year-over-year basis, construction spending was off 2.7%.
Residential spending was off 5.5%, more than offsetting a 0.6% increase in nonresidential outlays. Economists surveyed by Dow Jones had been looking for an increase of 0.4%. Private construction spending fell 2.4%, while public construction expenditures were off 0.1%.
Deutsche Bank has shifted back to an overweight rating on the tech sector after downgrading it to neutral earlier this month amid ongoing volatility.
The sector's "relative performance is now at the bottom of its long-run trend channel, a level from which it has V-turned up 5 times in the last 2 1/2 years," analyst Parag Thatte said in a Friday note to clients.
The Nasdaq-100 slid roughly 8% since Deutsche Bank issued its downgrade to a neutral rating on Oct. 9. On Friday alone, the index dropped by about 3.5%. Now, analysts at the bank see the trend reversing, with potentially positive effects for the broader market.
"The risk-reward now favors going overweight again. On average, these rotations into Tech have seen it rise 32%, outperforming the rest of the S&P 500 by 30pp. We note that S&P 500 performance in previous rotations into Tech has been very strong (up 16% over 3 months on average)," Thatte said.
U.S. factory activity accelerated in October as production ramped up, order backlogs declined and inventories swelled, the Institute for Supply Management reported Monday.
The ISM manufacturing index increased to 55.5, a 1-point jump from September that was better than the 54.5 consensus estimate from Dow Jones. The index measures the percentage of companies reporting growth.
Within the survey, the prices index slipped to 75.2, down 2.7 points, while inventories rose 2.8 points to 51.4 — out of contraction territory — and production increased to 59.0, up 2.3 points. Order backlogs declined 1.8 points to 54.6 and the employment index came in at 52.3, down just 0.3 points.
Amazon's spending spree on artificial intelligence will net big results for the hyperscaler, according to PhillipCapital. The firm upgraded the stock to buy on Monday and raised its price target to $330, which implies 37% upside ahead.
Amazon sold off on Thursday after holding its full-year guidance on capital expenditures at $220 billion and saying it will spend meaningfully more next year. It also reported negative free cash flow, amounting to $42.2 billion in outflows.
However, PhillipCapital believes Amazon is well positioned in artificial intelligence because it is model-agnostic and has a full stack of capabilities, analyst Helena Wang said in a note to clients.
"Aggressive CapEx creates FCF pressure, but strong demand visibility supports sustained infrastructure investment," she wrote. "We believe these investments will benefit AMZN over the long term, strengthen its market leadership and create significant barriers to entry for potential competitors."
The three leading U.S. indexes traded higher on Monday morning.
The S&P 500 rose 0.5% just after 9:30 a.m. ET, while the Nasdaq Composite climbed 0.7%. The Dow Jones Industrial Average moved up 405 points, or 0.8%.
Hyperscaler Oracle offered $10 billion worth of common stock on Monday amid the ongoing AI buildout, which is facing capital availability concerns. The book runners for the issuance include Wells Fargo, Citigroup and BNP Paribas, among several other banks.
Shares of Oracle were down more than 2.5% in premarket trading.
Oil prices extended earlier declines following reports that Iran's supreme leader granted some authority to the government to hold peace talks. Brent crude tumbled 6.1% to $106.50 per barrel. U.S. West Texas Intermediate futures also pulled back more than 6% to $97.70.
Goldman Sachs upgraded British American Tobacco to buy from neutral.
"For investors, we see a differentiated opportunity set: BAT offers the clearest growth inflection, while Imperial combines resilient cash generation with compelling value and capital returns.," wrote analyst Aron Adamski.
The firm sees pouches, vapor and heated tobacco as "growth vectors" and expects tighter regulation on illicit vapor will help regulated brands. British American Tobacco is well positioned to lead in transitioning the industry to smokeless nicotine, the bank added.
Goldman Sachs also raised its 12-month price target for British American Tobacco to 5,600 pence, implying a 22% upside.
Marvell Technology is buying optical-components maker Lumentum in a deal valued at $115 billion, creating a major new force in AI connectivity.
"AI infrastructure is undergoing a fundamental architectural shift toward optical connectivity," said Matt Murphy, Marvell's chairman and CEO. "By bringing together two leaders with highly complementary technologies, we intend to help shape the next era of AI connectivity and create exceptional stockholder value."
Under the agreement, Lumentum shareholders will receive 4.5 Marvell shares for each Lumentum share, giving them approximately 33% ownership of the combined company.
The acquisition combines Marvell's electrical technologies and Lumentum's optical expertise for next-generation AI data centers. Marvell expects the deal to expand its addressable market to $550 billion, generate more than $1 billion in annual cost synergies and boost earnings in the first year after closing.
Alphabet's transition from search revenue to artificial intelligence is underway, and it's lowered Wells Fargo's outlook slightly for the company's stock.
The bank reiterated its overweight target but lowered its price target on Alphabet to $365 from $371. That represents a 30% gain from Friday's close. Analyst Ken Gawrelski wrote in a Sunday note that the hyperscaler is in transition as its search revenue declines and Alphabet builds on supporting artificial intelligence instead.
"While extraordinary engagement gains support user preference for the product transformation, the business model doesn't appear ready yet to offset suppressed paid clicks w/ higher CPCs or new ad units," Gawrelski said in the note.
Alphabet sunk 13.5% over Thursday and Friday last week after the company reported on Wednesday negative free cash flow and weaker-than-expected search advertising revenue. Shares in premarket trading Monday were higher by just under 1%.
CrowdStrike – The cybersecurity stock rose 3.4% after an upgrade to buy from hold at Deutsche Bank. Analyst Brad Zelnick said the market is "still not fully appreciating the extent to which AI will expand the market for cybersecurity." Cybersecurity peer Palo Alto Networks gained 2% in sympathy.
Rivian – The stock climbed 3.8% after the electric vehicle company was upgraded to buy at UBS. Analyst Joseph Spak said the stock's recent sell-off presents a buying opportunity ahead of an inflection in its R2 midsize SUV ramp.
U.S. Treasury yields were mixed early Monday as investors gear up for another busy week of economic data and corporate earnings, as well as the midterm elections.
U.K. manufacturing production expanded at its fastest rate in more than two years in October, according to S&P Global Purchasing Managers' Index figures released on Monday.
Output and new orders grew at faster rates, confidence about the year ahead hit an eight-month high, and demand increased at home and abroad, though cost pressures and supply disruption remained elevated.
Rob Dobson, director at S&P Global Market Intelligence, said the sector showed "resilience" in the run-up to last week's budget, though a six-month run of increased hirings halted.
"The remainder of 2026 will see if the confirmed rise in the minimum wage for next year will continue to weigh on employment trends," Dobson said, adding that strong activity and high business costs would "further shorten the odds of interest rate hikes to come from the Bank of England."
Major U.S. AI stocks showed signs of recovery in premarket trading on Monday after shares of tech firms sold off last week amid concerns about an AI bubble.
SpaceX rose 3.2%, while AMD climbed 2.2%. Nvidia was up 1.5% and Micron 2.7%.
Neoclouds CoreWeave and Nebius were up 2.4% and 3%, respectively.
Eurozone manufacturing continued to grow in October. The S&P Global manufacturing purchasing managers' index came in at 52.7, down slightly from September's four-year high of 52.9 but above economists' forecast of 52.4. A reading above 50 signals growth.
Chris Williamson, chief business economist at S&P Global Market Intelligence, said the figures point to the strongest run of manufacturing growth in the eurozone in more than four years.
He said rising defense spending, companies building up supplies and shifts in trade patterns linked to U.S. policies are helping support growth opportunities. These gains are partly offset by tariffs, conflicts in the Middle East and Ukraine, and the resulting pressure on supply chains and costs.
Shares in French train manufacturer Alstom plunged 30.9% in early dealmaking Monday after the company slashed its full-year guidance to 1% for the fiscal year, from earlier target of 6.5%.
Free cash flow is expected to reverse into a 1.5 billion euro cash burn this year, Alstom said, citing delays to its Coradia Max regional rail project in Germany.
The pan-European Stoxx 600 was down 0.24% shortly after the market open, with the continent's major bourses moving lower and regional sectors mixed.
Travel and leisure stocks moved higher, gaining 0.72%, while European banks added 0.34%, and basic resources advanced 0.28%.
On the flipside, oil and gas names led losses, slipping 1.25%, as healthcare stocks shed 1.21%.
Among the continent's major bourses, only Italy's FTSE MIB showed a positive move in early dealmaking, rising 0.15% in Milan. The U.K.'s FTSE 100 dipped 0.34% in London, as the French CAC 40 shed 0.21% in Paris. Germany's DAX was down 0.03% in Frankfurt.
Asian markets were closed mixed on Monday, with Australia and Japan markets down, but other markets are in positive territory.
Australia S&P/ASX 200 was 0.58% down at 8,856.5, while Japan's Nikkei 225 gained 0.33% to 63,081.86.
South Korea's Kospi led gains with a 2.38% rise to 5,859.08, while the small-cap Kosdaq added 1.38% to close at 734.36.
Hong Kong's Hang Seng index gained 0.44% in its last hour of trade, while mainland China's CSI 300 added 0.79%.
Oil prices retreated sharply early Monday amid reports that the U.S. and Iran are seeking diplomatic options to end the eight-month-long conflict in the Middle East.
Brent crude futures, the international price benchmark, were down 3.02% at $110.01 per barrel at 1:20 a.m. E.T.
U.S. West Texas Intermediate futures for December delivery dropped 3.31% to $100.65.
Stock markets in Europe are expected to begin the first trading day of November in positive territory.
Stoxx 50 futures were seen moving 0.38% higher ahead of the market open.
France's CAC 40 is set to start the session up 0.33%, with the Italian FTSE MIB advancing 0.21%, and Germany's DAX rising 0.18%.
The U.K's FTSE 100, in contrast, is expected to trade 0.12% lower when markets open.
Mainland China and Hong Kong shares open higher after reports that Chinese financial regulators will meet banks and securities firms to discuss measures aimed at bolstering the country’s stock market.
Hong Kong's Hang Seng index gained 0.59%, while mainland China's CSI 300 added 0.21%.
The gains in Hang Seng were led by consumer cyclicals and tech sectors, up 0.48% each.
Shares of Kioxia fell around 14%, after the company cautioned that prices for flash memory are stalling, during its earnings call last Friday.
According to the Japanese semiconductor memory solutions firm, the average selling prices of NAND flash memory grew in the mid-20% range for the three months to September, compared with 70% in the prior quarter.
Kioxia also expects to deliver a 2 trillion yen in operating profit for the current quarter, but that was lower than what analysts had expected at 2.35 trillion yen. This suggests that prices increases were nearly flat on-quarter.
Asia-Pacific markets traded lower early Monday, tracking Wall Street's overall losses last week that was weighed by selling pressure in the tech sector.
Japan's Nikkei 225 fell 0.54% while the Topix declined 0.74%.
The Kospi dropped 1.39% at open, while the small-cap Kosdaq slipped 0.81%.
Australia's benchmark S&P/ASX 200 was 0.24% lower.
Oil prices moved lower on Sunday night as U.S. equity futures rose.
U.S. West Texas Intermediate crude futures fell more than 1% to $102.41 per barrel, while global benchmark Brent crude futures dropped more than 1% to $111.68 a barrel.
The moves mark a reversal from Friday's gains of more than 2%, which added to crude oil's more than 10% rise in October.
Asia-Pacific markets were set to open lower Monday, tracking U.S. stocks which suffered a losing week that was weighed by selling pressure in tech.
Japan's Nikkei 225 was poised to decline, with the Chicago futures contract at 62,720 and its Osaka counterpart last trading at 62,420, compared with the index's previous close of 63,290.11.
Hong Kong Hang Seng index futures were at 23,345, compared with the index's last close of 23,294.42.
Australia's S&P/ASX 200 was 0.16% lower.
Investors are keeping watch on developments related to the Middle East, as well as the upcoming U.S. midterm elections which will determine which party controls the Congress.
U.S. equity futures opened slightly higher on Sunday evening.
S&P 500 futures rose 0.2% just after 6 p.m. ET, along with Nasdaq-100 futures. Futures tied to the Dow Jones Industrial Average climbed 103 points, or 0.2%.