Expert Insights

As earnings reports put a spotlight on how the AI buildout is being financed, and oil price risk jarred markets, tech stocks slumped last week and defensive and cyclical stocks moved higher.

Significant tech-stock selling pressure emerged Thursday, with a rotation to safe havens. Strong industrial earnings helped to lift the Dow Jones Industrial Average ($DJI) 0.41% for the week. The S&P 500 (SPX) was down 0.47%, with Thursday's losses marking the SPX's worst day since July. Despite the volatility in AI and tech stocks, the Nasdaq-100 (NDX) declined only 0.79% for the week. With the 10-year Treasury yield lower for the week at 4.988%, rate-sensitive small cap stocks gained. The Russell 2000 (RUT) rose 2% for the week.

With more Middle East violence and uncertainty, WTI crude (CL) spiked nearly 4% to more than $103 Friday and rose more than 4% on the week.

Here are links to Schwab Network discussions that address three big themes from the week:

Pressure on Tech: AI Capex and Debt Concerns Fuel Chip Selloff

In its earnings report, Meta Platforms (META) raised the lower end of its 2026 capital spending outlook by $5 billion, to between $135 billion and $145 billion. In the quarter, a legal charge hit its operating profit, and it reported negative free cash flow, all of which contributed to selling pressure in AI-tied names including semiconductors. Neocloud company CoreWeave (CRWV) rebounded modestly early in the week but ended the week down 11%.

The PHLX Semiconductor Index was down more than 3% for the week, reflecting the rotation from tech during the week and in October. See:

U.S. stocks traded mixed Friday as surging crude oil prices and renewed Middle East tensions pressured the broader market, while technology shares stabilized following Thursday’s sharp AI-driven selloff.

The tech-heavy Nasdaq-100 (NDX) was flat, and the PHLX Semiconductor Sector Index (SOX) rebounded 0.44% after Thursday’s steep decline. But while the S&P 500 (SPX) fell 0.52%, and the Dow Jones Industrial Average ($DJI) dropped 1.23%. With the 10-year Treasury yield rebounding toward 4.99% following Thursday’s sharp decline, rate-sensitive small caps retreated, with the Russell 2000 (RUT) down 0.29%.

Volatility remained elevated, with the CBOE Volatility Index (VIX) up nearly 4% to 19.77. WTI crude (/CL) climbed nearly 4% to $103.54, as Houthi attacks in Saudi Arabia and broader concerns about renewed Middle East supply disruptions pushed energy prices higher.

Economic data remained relatively firm. S&P Global’s preliminary October manufacturing PMI increased to 56.0, while services came in at 57.9 and the composite index registered 57.6, signaling continued expansion in U.S. business activity. October consumer sentiment remained at a multi-month low.

Five things to watch from Friday’s market:

Bloom Energy Sinks 11%