Stock Indexes Mostly Lower as Chipmaker Weakness Persists

The S&P 500 Index ($SPX) (SPY) is down by -0.06% today, the Dow Jones Industrial Average ($DOWI) (DIA) is up by +0.44%, and the Nasdaq 100 Index ($IUXX) (QQQ) is down -0.96%.  December E-mini S&P futures (ESZ26) are down -0.10%, and December E-mini Nasdaq futures (NQZ26) are down -1.02%.

Stock indexes are mixed today, with the Dow Jones Industrial climbing to a 1-month high.  The broader market is under pressure from weakness in chipmakers and AI-infrastructure stocks.  CoreWeave is down more than -7% to lead cloud infrastructure stocks lower as concerns about the company’s credit risk linger.

Higher bond yields are also undercutting stocks after Fed Chair Warsh made no remarks on monetary policy or his outlook for the US economy late Thursday evening at the IMF annual meeting in Bangkok.  The 10-year T-note yield is up +1 bp to 5.09%.

On the positive side, a rotation out of AI stocks and chipmakers into software, food producers,  and industrial stocks is boosting the Dow Jones Industrials today.

Today’s US economic news was mixed for stocks.  The Sep import price index ex-petroleum rose +0.8% m/m, stronger than expectations of +0.6% m/m, the largest increase in 5 months and a sign of price pressures.  However, Sep manufacturing production rose +0.3% m/m, right on expectations.

Stocks have support from the prospect of solid quarterly earnings results that began this week.  Goldman Sachs on Monday raised its three-month view on global equity markets to overweight from neutral, saying. “Earnings growth remains supportive for equities and the recent valuation de-rating has improved asymmetry into the third-quarter earnings season.” According to data compiled by Bloomberg Intelligence, Q3 S&P 500 earnings are expected to climb by +25% from a year earlier, up from a July estimate of 22%.  As of today, 40 of the S&P 500 companies have reported results, with 78% beating estimates.

Nov WTI crude oil prices (CLX26) are down -0.58% today on signs of higher Middle East exports after US Central Command said more than 40 vessels moved through the Strait of Hormuz over the past 24 hours. However, crude oil prices have underlying support amid risks to global oil supplies.  Yemen's Houthi rebels continue drone and missile attacks across Saudi Arabia, including energy infrastructure.  Also, Iranian attacks on shipping attempting to transit the Strait of Hormuz have increased in recent weeks, threatening a rebound in energy supplies from the Middle East.

Markets are discounting a 13% chance of a +25 bp Fed rate hike at the next FOMC meeting on October 27-28.

Overseas stock markets are higher today.  The Euro Stoxx 50 is up +0.74%.  China's Shanghai Composite closed up +0.24%.  Japan's Nikkei-225 Stock Average closed up +1.39%.

Interest Rates

December 10-year T-notes (ZNZ6) are down -2 ticks today.  The 10-year T-note yield is up +0.7 bp to 5.092%.  Dec T-notes are under pressure today after global stock markets recovered, dampening safe-haven demand for T-notes.  Also, a lack of guidance from Fed Chair Warsh at the annual IMF meeting in Bangkok weighed on T-notes.  Losses in T-notes are limited today as  a decline in crude oil prices has reduced inflation expectations.  

European government bond yields are mixed today.  The 10-year German bund yield is up +0.4 bp to 3.417%. The 10-year UK gilt yield is down -0.8 bp to 5.367%.

ECB Governing Council member and Bundesbank President Joachim Nagel said. "The ECB has raised interest rates twice, and if the situation remains as it is, we don't rule out the possibility that we may have to take further action."

Markets are discounting a 8% chance of a +25 bp ECB rate hike at the ECB’s next meeting on October 29.

US Stock Movers

Chipmakers and AI-infrastructure stocks are continuing their week-long slide today, weighing on the broader market.  Seagate Technology Holdings Plc (STX) is down more than -4%, and Western Digital (WDC) and SanDisk (SNDK) are down more than -3%.  Also, ARM Holdings Plc (ARM), Advanced Micro Devices (AMD), Micron Technology (MU), Lam Research (LRCX), and Intel (INTC) are down more than -2%.  In addition, Marvell Technology (MRVL), KLA Corp (KLAC), Applied Materials (AMAT), and Broadcom (AVGO) are down more than -1%.

CoreWeave (CRWV) is down more than -7% to lead cloud infrastructure stocks lower as debt concerns linger after swaps priced in a more than 50% chance the company will default on its debt within five years.  Also, Nebius Group NV (NBIS) is down more than -6%, and Applied Digital (APLD) is down more than -5%.  In addition, Lumentum Holdings (LITE) is down more than -3%, Oracle (ORCL) is down more than -2%, and Arista Networks (ANET) is down more than -1%.

Cybersecurity stocks are sliding today.  Okta (OKTA) is down more than -7%, and Cloudflare (NET) and SentinelOne (S) are down more than -5%.  Also, Fortinet (FTNT), Crowdstrike Holdings (CRWD), Palo Alto Networks (PANW) and Zscaler (ZS) are down more than -4%. 

Defense contractors are climbing today as the companies are set to benefit from increased defense spending.  Lockheed Martin (LMT), Northrop Grumman (NOC), and RTX Corp (RTX) are up more than +2%, and General Dynamics (GD), L3Harris Technologies (LHX), and Huntington Ingalls Industries (HII) are up more than +1%.

Food producers are moving higher today as investors rotate out of chipmakers and AI stocks.  Kraft Heinz Co (KHC), McCormick & Co (MKC), J M Smucker (SJM),  Hershey Co (HSY), Hormel Foods (HRL), and Mondelez International (MDLZ) are up more than +1%.

Omeros (OMER) is down more than -12% after the European Medicines Agency issued a negative opinion on the company’s application for its narsoplimab therapy.

Fox Corp (FOXA) is up more than +1% after Bank of America Global Research double-upgraded the stock to buy from underperform with a price target of $85.

Earnings Reports (10/16/2026)

Citizens Financial Group Inc (CFG), M&T Bank Corp (MTB), Regions Financial Corp (RF), Travelers Cos Inc/The (TRV), Truist Financial Corp (TFC).

On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.