Nasdaq Gains 0.8% as Anthropic's IPO Filing Revives the AI Trade

U.S. stocks closed higher on Monday, Oct. 26, led by the Nasdaq Composite, as Anthropic's public filing for an initial public offering revived the artificial-intelligence trade, chip stocks rallied, and easier oil prices and little-changed Treasury yields left the week's real tests - the Federal Reserve decision and the biggest AI spenders' earnings - still ahead.

The Dow Jones Industrial Average rose 146.60 points, or 0.28%, to 52,361.76, the S&P 500 gained 53.35 points, or 0.70%, to 7,677.03, and the Nasdaq Composite gained 214.02 points, or 0.83%, to 26,169.38, according to preliminary closing data. The Russell 2000 rose 0.5%. Stocks closed on broad gains, led by strength in technology and artificial-intelligence-related names.

Monday's advance only partly repaired the week that preceded it. The S&P 500 and the Nasdaq Composite were coming off consecutive weekly declines after a down Friday in which the Dow fell 1.2%, or 652.82 points, to close at 52,215.16, the S&P 500 shed 0.5% to finish at 7,623.68 and the Nasdaq Composite ended at 25,955.34, sliding 0.2%. For that week, the S&P 500 and the Nasdaq Composite finished lower while the Dow ended higher - the split that Monday's broad gains narrowed but did not erase.

Anthropic's filing revived the AI trade, and chips led the way

Anthropic disclosed steep losses alongside rapid revenue growth in its filing for a U.S. initial public offering, and the market treated the filing itself as the day's catalyst. TickerGrove covered the filing's financials in full in separate coverage published Monday; in the closing tape, the point was what the filing did to everything around it. "Today's all about the Anthropic release, so we're back on a little bit of an optimistic tilt," said JP Powers, chief investment officer at RWA Wealth Partners.

The Philadelphia semiconductor index rose about 3% on the day, even though it is still down nearly 12% on the month, and the technology index led gains among the 11 major S&P 500 sectors. Nvidia, Advanced Micro Devices, Broadcom and Micron were among the chip names that rose, and photonic product makers Lumentum and Coherent were among the best-performing S&P 500 stocks. Neocloud firms including CoreWeave erased earlier declines as the filing buoyed sentiment across the AI complex. Meta Platforms was flat on the day even as it moved to fund that same buildout, planning to raise up to $95 billion in equity for its AI-related expansion.

Tesla jumped on an upgrade while deal stocks did the heavy lifting

Tesla rose sharply, touching its highest intraday level in more than three months after Barclays upgraded the stock to overweight from equal-weight and lifted its price target to $450 from $370. The upgrade gave the megacap tape a second engine alongside the chips, on a day when megacap and growth stocks were mostly higher.

Deal stocks supplied the day's biggest single-name moves. Range Resources jumped after EQT agreed to acquire it in an all-stock deal: Range holders will receive 0.987 EQT shares for each of their shares, valuing Range at $54.91 a share, about $12.83 billion in all and a 21% premium to its latest close, while EQT itself declined. Surgery Partners surged to just under the $23.50-a-share cash price in its $5.7 billion take-private, a deal TickerGrove covered in full in separate coverage published Monday.

Verizon slipped, Fair Isaac plunged and Brazil sold off hard

Verizon declined after a narrow revenue miss overshadowed an adjusted-earnings beat and a raised fiscal 2026 outlook, with AT&T up 0.2% and T-Mobile down 0.6% in a muted carrier tape. Fair Isaac plunged after it held its mortgage credit-scoring pricing at $10, a decision that drew criticism from analysts. SpaceX rose 0.8% after Elon Musk said the company had closed $40 billion in GPU debt financing, the subject of separate TickerGrove coverage.

Brazil was the day's pocket of real damage. The Bovespa fell 13.5% after Luiz Inacio Lula da Silva's runoff victory, and the selloff hit U.S.-listed Brazilian names hardest where leverage to the result was greatest: Ambev fell 16%, Petrobras fell 15% and XP fell 48%. TickerGrove covered the election result and the market reaction in separate coverage; in the U.S. close, the Brazil leg was a reminder that Monday's optimism was a technology story, not a global one.

Easier oil and steady yields left the Fed meeting in control

A decline in oil prices, as well as dip in Treasury yields, also helped boost sentiment, and heading into the close S&P 500 sectors were mostly higher, led by industrials and technology, while communication services lagged. Oil prices eased with no verified settlement level in the sources checked, and the 10-year Treasury yield was little changed near 5%, a backdrop that neither forced the Fed's hand nor relieved it. Oil stocks were mixed on the softer crude tape: Chevron fell 0.2%, ConocoPhillips rose 0.5% and ExxonMobil rose 0.4%.

The Federal Open Market Committee meets on Oct. 27 and 28, and markets are pricing in only a 12.7% chance of a rate hike from the Fed on Wednesday, according to CME FedWatch. With inflation pressures showing no signs of abating, few participants expect the central bank to stay on hold for long, and the Nov. 3 midterm elections, which will decide control of Congress, sit directly behind the meeting in the calendar.

The Fed decides Wednesday, and the biggest AI spenders report around it

More than a third of S&P 500 companies are scheduled to report earnings this week, including Alphabet, Microsoft and Amazon.com, whose results will be parsed for signs of whether the hefty AI investments are translating into growth. Alphabet and Microsoft report Wednesday, after the Fed's policy statement, and Amazon.com follows Thursday, the same day readings on economic growth and inflation arrive. Monday's rally bought the AI trade a better mood; those four events decide whether it keeps it.