All three major U.S. stock indexes opened higher to start the week, with technology sector shares climbing and oil prices pulling back.
The Dow Jones Industrial Average gained 0.29%, the S&P 500 rose 0.30%, and the Nasdaq Composite added 0.33%.
Among the "Magnificent Seven," Tesla climbed 3.90%, Nvidia rose 1.19%, Amazon advanced 0.74%, Microsoft gained 0.62%, and Google edged up 0.06%, while Meta Platforms fell 0.45% and Apple dropped 0.96%.
AI research company Anthropic publicly filed for an initial public offering (IPO), sending chip stocks and other AI-related shares higher. Investors are betting that the listing could inject fresh momentum into an already flagging tech stock rally. The AI research firm said it plans to list on the Nasdaq exchange under the ticker symbol "ANT."
London Brent crude oil futures fell 1.4% to $115.02 per barrel, while U.S. WTI crude oil futures dropped 2% to $101.01 per barrel. Brent crude touched its highest level since April last Friday amid reports that the United States and Israel may be planning strikes on Iran after the U.S. midterm elections conclude. Rising oil prices, combined with broad selling across multiple market sectors, sent all three major indexes lower last Friday. The selloff also pushed the S&P 500 and Nasdaq to their second consecutive weekly decline.
The neocloud sector also weighed on the broader market last week, as investors worried that related companies are taking on heavy debt to expand their AI businesses. Neocloud stocks fell again on Monday after Elon Musk stated that more than 200 companies in the sector are facing a crisis.
Traders are now waiting for the Federal Reserve to announce its interest rate decision on Wednesday. Federal funds futures trading data shows a 90% probability that policymakers will keep the current target rate range of 3.75%-4% unchanged. Bank of America, meanwhile, expects the Fed to raise rates by 25 basis points, noting that this would be a "very difficult" move. Bank of America economist Claudio Irigoyen wrote in a research note: "The October decision will test Chairman Warsh's determination to bring a 'radical overhaul' to the Fed's forward guidance strategy. The challenge Warsh faces at the press conference is preventing the market from betting on a 'policy mistake.' If the Fed raises rates, investors will worry about excessive tightening; if the Fed stays put, the market will question the Fed's credibility in fighting inflation."
BTIG Pours Cold Water: Midterm Elections May Be a "Starting Point for Decline" Rather Than a "Starting Point for Rebound"
Wall Street investors hoping for a stock market rally after the November midterm elections may be disappointed. BTIG strategist Jonathan Krinsky believes that as credit conditions deteriorate and multiple sectors show signs of weakness, the risk of a stock market decline is rising. In a research report, Krinsky said the S&P 500 could pull back to around 7,300 points, near its 200-day moving average and summer lows. That would represent a decline of about 4.3% from the index's recent level of 7,631 points. If it breaks below this technical support level, the benchmark index could fall further. This warning challenges the widespread expectation that "stocks will rise after the uncertainty of the November 3 election dissipates." Historically, midterm elections have often been a turning point for the stock market, but Krinsky believes that this year's unusually strong market performance makes a repeat of that pattern less likely. Krinsky wrote: "The reason stocks tend to perform well in November of midterm election years is that the S&P 500 typically has already weakened before the election. This year, the situation is exactly the opposite."
Goldman Sachs: Retail Trading Down 45% From Late 2025, Maintains Year-End S&P 500 Target of 8,000
Goldman Sachs said retail investors have significantly reduced stock trading in recent months, but overall demand for equities from U.S. households remains strong enough to help support the market amid rising selling pressure and increasing stock supply. Goldman Sachs strategist Ben Snider said in an October 23 research report that retail trading volume has fallen 20% since the summer and 45% since late 2025. Individual investors recently accounted for about 9% of total U.S. stock trading volume, down from 15% at the end of last year and near the lowest level since 2020. Meanwhile, after a turbulent week for hedge fund favorites, hedge funds have reduced their market exposure. This divergence — cooling speculative activity alongside still-strong household investment demand — is significant for the stock market. Households are the largest holders of U.S. stocks, and their willingness to invest is an important source of support for stock prices. Goldman Sachs expects net supply of U.S. public equities to see its largest increase since 2000 in 2027, making continued household buying potentially even more important.
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