Closing Bell: Job Jitters Shake AI Trade; Datadog Surges

Key points

Broad selloff into the close: U.S. equities finished lower across the board. The S&P 500 fell about 0.7%, the Nasdaq Composite dropped roughly 1.9%, the Dow slipped about 0.8%, and the Russell 2000 lost around 1.5%, confirming a decisive risk-off session with small caps and growth underperforming. The 10-year Treasury yield ended near 4.09% (≈−7 bps), read more as a growth and labor scare than disinflation, while the VIX closed just under 19, signaling elevated but not panicked demand for protection.

Layoff data underscored a softening labor market: The latest ADP figures signaled sluggish private hiring, while Challenger, Gray & Christmas reported 153,074 announced job cuts in October—the highest October since 2003 and nearly triple the 55,597 cuts a year earlier. Of these, 50,437 were tied to cost-cutting and 31,039 explicitly to artificial intelligence, underscoring how efficiency drives and automation are translating into realized job losses.

The broader AI and high-growth complex came under sustained pressure as investors rotated out of crowded winners and repriced lofty multiples against softer labor signals, falling yields, and lingering policy/fiscal uncertainty.

Earnings dispersion stayed extreme: companies delivering clean beats, durable demand, and disciplined spend were rewarded, while even modest guidance cuts or margin pressure drew outsized selling.

Datadog (DDOG): high-quality AI/infra winner

Datadog delivered one of the cleanest prints of the season. Q3 revenue climbed to roughly $885.7M (+28% Y/Y) with adjusted EPS around $0.55, both ahead of expectations, supported by growth in large customers and strong AI- and cloud-driven observability demand. Management raised full-year guidance on both revenue and EPS, signaling confidence in durable, high-margin growth. The stock surged sharply on the day, making DDOG a textbook example of how the market is still willing to reward credible, compounding infrastructure stories even in a de-risking tape.

DoorDash (DASH): growth good, costs higher

DoorDash posted ~27% Y/Y revenue growth (around $3.4–3.45B, ahead of estimates) and solid order momentum, but rising costs, heavy investment spend, and a softer outlook on profitability overshadowed the top-line strength. Management flagged ongoing elevated expenses tied to expansion and new initiatives, pressuring margins and forward EBITDA expectations. Shares dropped sharply as investors punished the mismatch between robust growth and constrained earnings power.

Key Market Events for Tomorrow (Fri, Nov 7, 2025) — ET

8:30 AM: October Nonfarm Payrolls & Unemployment Rate critical test of the slowdown narrative shaped by ADP and Challenger, Gray & Christmas layoff data.

Notable Earnings

Post-market today (Thu, Nov 6) –ABNB, TTD, DKNG, AFRM, HOOD, SOUN, IREN

Pre-market tomorrow (Fri, Nov 7) –FLR, ESNT, MKTX

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