Nasdaq suffers worst month since March 2025 as technology stocks tumble
Bitcoin tests key support as Binance security fears weigh
Week ahead: Elections, rate decisions and jobs take center stage
Earnings next week: Can Apple, Palantir and AMD restore confidence?
Fed’s Logan: At least two more quarter-point rate hikes needed
Carney: Canada, EU working toward deepest possible partnership, short of accession
Fed’s Daly: AI matters for near- and medium-term policy
Fitch on UK Budget: Policy continuity leaves a tough delivery challenge
Fed’s Barkin: Direction of travel is straightforward for the Fed
Canada GDP for August 0.0% vs 0.2% estimate
US employment cost index for Q3 +0.8% vs +0.8% expected
Morning Kickstart: Tech hammered as Amazon and Intel tumble; oil rises despite peace talk
investingLive European session wrap: AI spending fears spook tech stocks; dollar falls alongside yields, gold
October ended with investors taking a harder look at the cost of the AI boom. Technology led a broad stock-market decline as disappointing reactions to Amazon and Intel earnings reinforced concerns about spending, profitability and cash flow. Strong demand remains part of the story, but investors are becoming more demanding about when that demand translates into returns.
The cross-market moves were revealing. Treasury yields declined even as several Fed officials argued for further tightening. Oil moved higher, keeping inflation concerns alive, while gold failed to benefit from lower yields. Bonds attracted defensive demand, but the protection did not extend across every traditional haven.
Dollar finishes mixed after recovering earlier losses
The dollar was mixed in the supplied late-session snapshot. Its strongest performance was against the euro, with EURUSD down 0.13% at 1.1164. Its weakest performance was against sterling, with GBPUSD up 0.11% at 1.3390.
USDJPY slipped 0.06% to 157.59, while USDCHF rose 0.05% to 0.8246. USDCAD edged down 0.06% to 1.3979 despite disappointing Canadian growth data. AUDUSD gained 0.07% to 0.7032, while NZDUSD fell 0.07% to 0.5629.
The mixed finish marked a recovery from the dollar’s broader weakness earlier in the session. Falling U.S. yields provided a headwind, but the currency market did not deliver a uniform risk-off response.
Treasury yields fall despite calls for more tightening
Treasury yields were lower across the curve in the supplied snapshot. The 2-year yield fell 6.43 basis points to 4.5917%, the 5-year declined 7.87 basis points to 4.7233%, the 10-year dropped 5.86 basis points to 4.9303%, and the 30-year eased 1.76 basis points to 5.3114%.
The larger declines in shorter and intermediate maturities steepened the curve. The move was consistent with defensive demand as stocks weakened, even though the Fed commentary offered little reassurance that the tightening cycle was finished. Lower yields alone were insufficient to offset the concerns facing technology shares.
U.S. stocks: Nasdaq leads the retreat
The supplied end-of-day index readings showed:
Dow industrial average: −573.08 points, or −1.09%, at 51,775.17.
S&P 500: −140.32 points, or −1.82%, at 7,580.07.
Nasdaq Composite: −747.73 points, or −2.86%, at 25,437.00.
Russell 2000: −47.37 points, or −1.66%, at 2,811.84.
Nasdaq 100: −1,017.66 points, or −3.46%, at 28,384.85.
The selling extended beyond technology, but the Nasdaq indices carried the heaviest burden. The Dow held up better on a relative basis, although a decline of more than 570 points still reflected a difficult session.
AI faces questions about financing and returns
Amazon and Intel remained central to the earnings concerns. Investors questioned how much spending would be required to sustain AI growth and how quickly that investment would produce stronger profits and cash flow.
A separate Financial Times report covered by InvestingLive added a financing concern: Blackstone reportedly told Anthropic that it might not obtain an investment-grade credit rating after its IPO. This was a reported possibility, rather than a ratings decision, but it sharpened the focus on borrowing costs. Intel was down more than 30% in that afternoon report, with substantial losses across chip and infrastructure suppliers including AMD, Arm, Marvell, Astera Labs and Coherent. Those were intraday readings.
European stocks mostly lower
European markets also finished mostly lower, with the UK holding a modest gain:
Germany’s DAX: −221.47 points, or −0.85%, at 25,818.22.
France’s CAC 40: −0.58 points, or −0.01%, at 7,969.43.
UK’s FTSE 100: +7.73 points, or +0.07%, at 10,729.79.
Spain’s IBEX: −204.70 points, or −1.09%, at 18,652.90.
Italy’s FTSE MIB: −501.39 points, or −1.02%, at 49,290.91.
Fed speak: More tightening remains on the table
Today’s Fed commentary carried a predominantly hawkish message, although the speakers differed in how directly they addressed the next policy move. Barkin favored gradual adjustment, Musalem argued for another increase soon, and Logan outlined a minimum of two additional quarter-point hikes. Daly concentrated on AI’s implications for the Fed’s inflation and employment objectives.
Richmond Fed President Barkin described the direction of policy as straightforward, with the pace still open to debate. He favored a gradual approach but pointed to resilient consumer spending, broad business cost pressures and companies preparing to pass those costs to customers. His comments on AI were particularly relevant to the day’s market debate: the investment surge is adding demand and straining supply chains, creating inflation pressures that monetary policy can lean against. His assessment suggested that economic resilience continues to give the Fed room to address persistent inflation.
San Francisco Fed President Daly focused on how AI affects both price stability and employment. She emphasized that those effects matter for policy in the near and medium term. Her remarks did not establish a preference for a hike or a pause. The takeaway was that AI’s effects on the economy are already relevant to current monetary policy decisions.
St. Louis Fed President Musalem delivered a more explicit call for action, saying rates would need to rise again soon. He viewed monetary policy and overall financial conditions as accommodative, with inflation unlikely to ease sufficiently without additional Fed action. Higher bond yields had tightened conditions, but not enough in his assessment. His preference was to act earlier in smaller increments, reducing the risk that delayed action eventually requires a sharper adjustment. A strong economy and labor market supported that approach, while inflation risks remained tilted higher.
Dallas Fed President Logan was the most specific about the amount of tightening she considered necessary. She called for at least two more quarter-point increases to make policy modestly restrictive, followed by a pause to assess whether further action was needed. Skipping a meeting, in her view, would not change the destination. Gradual adjustments could help households, businesses and investors adapt, but she regarded the lack of progress toward the 2% inflation target as unacceptable. Her message made clear that a pause should not automatically be interpreted as the end of tightening.
For traders, the distinction matters: Treasury yields fell on the day, but these remarks did not amount to a dovish shift from the Fed.
Economic data: Labor costs moderate, growth signals soften
The U.S. Employment Cost Index rose 0.8% in the third quarter, matching expectations and slowing from 0.9%. Wage growth eased to 0.7% from 0.9%, while benefit costs increased 0.9%, down from 1.0%. The report offered some reassurance on compensation pressures, although it did not resolve the broader inflation concerns raised by Fed officials.
Chicago PMI fell to 55.3, below the 56.1 estimate and down from 58.8. Activity remained above the 50 dividing line, but the pace of expansion slowed.
Canada’s August GDP was unchanged versus expectations for 0.2% growth. The advance estimate pointed to a 0.1% decline in September, reinforcing the picture of an economy struggling to build momentum.
German preliminary inflation also came in softer than expected. Annual CPI and harmonized inflation both slowed to 2.8%, below forecasts of 3.0% and 3.1%, respectively.
Oil rises as Middle East risks persist
WTI crude traded at $102.89, up $0.89 or 0.87% in the supplied snapshot.
InvestingLive’s oil coverage highlighted Houthi attacks on Saudi energy infrastructure and reports of U.S. preparations for potential strikes on Iran. Those developments kept supply risks in focus heading into the weekend. Elevated energy prices also complicated the inflation outlook, even as Treasury yields declined.
Gold and silver join the selling
Spot gold fell approximately $146.24, or 3.64%, to $3,874.33. Silver dropped $3.0644, or 5.88%, to $49.0756. Copper also declined 1.75% to $6.4870.
Gold’s weakness stood out because Treasury yields were lower. That would normally provide support, but sellers retained control. InvestingLive’s gold analysis identified liquidation pressure associated with equity losses as a possible explanation: investors needing cash can sell liquid holdings such as gold to meet obligations elsewhere. That remains an interpretation of the selling, rather than a confirmed explanation for every transaction.
Silver’s larger percentage decline, alongside weaker copper, also left the more industrially sensitive metals under pressure.
Bitcoin remains under pressure
Bitcoin traded at $76,803, down $989 or 1.27% in the supplied snapshot.
The broader retreat from risk assets was compounded by concerns surrounding the reported Binance security breach. InvestingLive’s crypto coverage described exchange-security anxiety and leveraged liquidations as additional sources of pressure. Falling Treasury yields offered little relief as investors weighed both market-wide weakness and crypto-specific uncertainty.
Next week: U.S. elections, jobs and central-bank decisions
The November 2–6 calendar brings several important tests for markets, led by Tuesday’s U.S. midterm elections and Friday’s employment report. The results will help shape expectations for government policy, economic growth and the Fed’s next move.
Monday starts with the U.S. ISM manufacturing report at 10:00 AM ET. Wednesday brings ADP employment at 8:15 AM ET and ISM services at 10:00 AM ET. Beyond the headline readings, traders will watch the employment and prices components for evidence of whether activity is slowing while inflation pressures persist.
Tuesday’s midterm elections will determine control of the House and Senate, with implications for taxes, spending, regulation and the administration’s legislative agenda. The September JOLTS report, due at 10:00 AM ET, provides another measure of labor demand ahead of payrolls.
Central banks also remain in focus. The Reserve Bank of Australia announces its decision Tuesday, November 3, Australian time—Monday evening in the U.S.—with several major banks expecting a 25-basis-point hike to 4.85%. The Bank of England follows Thursday with its rate decision and updated economic forecasts. Both events will test how policymakers balance inflation risks against the effects of tighter policy.
Thursday brings U.S. jobless claims and preliminary third-quarter productivity and labor costs at 8:30 AM ET. Friday is the main economic event: U.S. payrolls, unemployment and average hourly earnings at 8:30 AM ET, alongside Canada’s employment report. Preliminary University of Michigan consumer sentiment follows at 10:00 AM ET, with inflation expectations another important barometer. Together, the reports will help determine whether the economy remains resilient enough to support further Fed tightening.
What traders carry forward
The next session begins with three connected questions: can technology shares stabilize, can Middle East risks ease enough to take pressure off oil, and will incoming data justify the additional tightening several Fed officials favor? Friday showed that lower Treasury yields alone are not enough to restore confidence when earnings, financing costs and inflation remain in question.
This article was written by Greg Michalowski at investinglive.com.
