NEW YORK, October 19 — The Nasdaq Composite led gains on Wall Street on Monday as investors returned to artificial intelligence-related stocks following last week’s sharp sell-off. Falling oil prices also supported the market ahead of a busy week of corporate earnings reports.
The rebound followed the S&P 500 and Nasdaq’s biggest weekly declines since late June, driven by concerns that higher interest rates could slow investment in AI infrastructure and increase financial pressure on data center operators.
Investors have become increasingly concerned about how the expensive AI expansion will be financed, particularly as heavily indebted companies face rising borrowing costs.
AI Stocks Recover After Last Week’s Sell-Off
CoreWeave, which came under pressure last week because of concerns surrounding its $50 billion debt burden, rose 3.1% on Monday. Goldman Sachs upgraded the AI cloud infrastructure provider to “buy” from “neutral,” describing the recent decline as a potential buying opportunity.
Other AI infrastructure companies also advanced. Nebius gained 4.7%, while Iren climbed 6.5%.
Chipmakers joined the recovery, with Broadcom rising 3.2% and Micron jumping 5.3%. The Philadelphia Semiconductor Index gained 3.7%, putting it on track to end an eight-session losing streak, its longest series of declines since October 2008.
Amazon shares climbed 5.2% after Morgan Stanley named the e-commerce and cloud computing company its top stock pick.
Joe Saluzzi, co-head of equity trading at Themis Trading, said concerns over CoreWeave’s bond yields and potential liquidity problems had frightened investors. However, he noted that conditions appeared to have stabilized, suggesting the broader AI investment trend could continue.
Wall Street Gains as Oil Prices Decline
At 11:42 a.m. Eastern time, the Dow Jones Industrial Average rose 91.03 points, or 0.18%, to 52,093.44.
The S&P 500 gained 68.47 points, or 0.89%, to 7,727.91, while the Nasdaq Composite advanced 463.92 points, or 1.78%, to 26,603.96.
Technology and consumer discretionary stocks led sector gains, rising 2.2% and 2.8%, respectively.
Brent crude futures fell 1.7% to approximately $108 a barrel following US President Donald Trump’s decision to waive certain sanctions on Russia.
Other notable movers included Intel, which rose 5.8% after JPMorgan upgraded its rating to “neutral” from “underweight.” Steelmaker Cleveland-Cliffs surged 15.6% after reporting third-quarter profit above analysts’ expectations.
Despite the recovery, market breadth remained mixed. Declining stocks outnumbered advancing shares on the New York Stock Exchange, while advancing issues led on the Nasdaq.
The S&P 500 recorded 10 new 52-week highs and two new lows. The Nasdaq Composite posted 20 new highs and 242 new lows.
Investors Turn Their Attention to Corporate Earnings
Market participants are now preparing for a series of major earnings reports that could help determine whether the recent AI-related volatility eases or intensifies.
Meta Platforms is expected to report results on Wednesday, with analysts anticipating performance above Wall Street expectations. Tesla is also scheduled to release its third-quarter results that day, while SpaceX is expected to report on Tuesday.
Investors will be watching for updates on AI spending, revenue growth, profitability and data center investment plans, particularly as concerns about borrowing costs continue to influence technology valuations.
The earnings announcements arrive at a critical time for the sector, with investors increasingly distinguishing between companies capable of financing their AI investments sustainably and those more exposed to debt-related risks.
Market Recovery Faces a Crucial Test
Monday’s gains suggest that investors are willing to return to AI-related stocks after last week’s sell-off. However, uncertainty surrounding financing costs, infrastructure spending and the outlook for interest rates remains.
The session also coincided with the 39th anniversary of Black Monday, the 1987 stock market crash that marked the largest one-day percentage decline in Dow Jones Industrial Average history.
With major technology companies preparing to report earnings, investors will be looking for evidence that strong AI demand can translate into sustainable profits without excessive borrowing.
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