Nasdaq Rises 308.43 Points to 26,477.81 as AI Momentum Returns

Key Facts

The Nasdaq Composite closed up 308.43 points, or 1.2%, at 26,477.81 on Tuesday, October 27, in a session led by technology stocks among U.S. indexes. The S&P 500 rose 0.6% to 7,722.60, while the Dow Jones gained less than 0.1% to 52,377.57, according to data reported by the Associated Press. The Nasdaq’s move came as investors renewed their appetite for AI and chip stocks after developments involving Anthropic drew investor interest. Broadcom gained after announcing financing that gives the startup access to its specialized AI chips. That refocused attention on AI infrastructure deals as investors prepared for the Federal Reserve’s decision.

Broadcom shares rose 4% after the announcement of a $63 billion financing deal that helps Anthropic access Broadcom’s AI accelerators and networking solutions, according to the Associated Press. Nvidia shares also climbed 0.9%, and CoreWeave jumped 7.9%, extending gains across companies tied to AI infrastructure. Reuters said interest in details expected about Anthropic’s public offering helped chip stocks rise for a third consecutive session. The companies’ share moves coincided with investors’ bets that demand for computing capacity and chips would continue, alongside financing and expansion news. The Nasdaq’s strength was more pronounced than that of the broader market, as gains in the other two indexes were much smaller.

From the start of the year through October 27, the Philadelphia Semiconductor Index rose 62.1%, compared with a 12.8% gain for the S&P 500, according to Reuters. The sector index, however, remains more than 20% below its record closing level set on June 22. This divergence places the recent chip rally within a strong year for the sector relative to the market, while leaving a substantial gap between its current level and its previous peak. On Tuesday, the S&P 500 came within 1.2% of a record high set earlier in October, even as most of its constituent stocks fell. Gains were concentrated in select AI-related stocks, while the broader index’s move did not reflect a market-wide advance.

On the economic data front, new orders for U.S. durable goods rose by $6.3 billion, or 1.8%, to $345.4 billion in September, according to the U.S. Census Bureau. This followed a monthly increase of 0.1% in August, and the bureau said orders rose in 6 of the past seven months. Excluding transportation equipment, orders increased 0.5% in September, showing that the overall rise was not limited to that component. Transportation equipment led the move, however, with orders rising $5.2 billion, or 4.6%, to $119.8 billion. The Conference Board also reported that consumer confidence rose in October, another sign of an improvement during the month, though the available statement did not provide a numerical value for the index.

Attention is turning to the Federal Open Market Committee meeting on October 27 and 28, with the monetary policy decision and a news conference by the Federal Reserve chair scheduled for Wednesday. The Associated Press reported that the prevailing expectation on Wall Street was for interest rates to remain unchanged. The news conference is scheduled for 2:30 p.m. Eastern time. In bond markets, the 10-year U.S. Treasury yield slipped to 4.99% from 5.00% at Monday’s close. Brent crude also fell 1.2% to $109.41 a barrel on Tuesday as investors awaited the Fed’s decision.

The Bureau of Economic Analysis will release its September personal income and spending report on October 29 at 8:30 a.m. Eastern time, including monthly personal consumption expenditures price data. The report comes the day after the Fed meeting and adds a reading on inflation and spending to the data investors are monitoring after the decision. The U.S. Census Bureau also set November 3 at 10:00 a.m. as the release time for the full September durable-goods orders report. The preliminary figures released on October 27 showed the monthly increase and its distribution between total orders and transportation equipment. These dates will be the next milestones in tracking how activity and price data affect assessments of the monetary policy path.