US stocks today: Nasdaq ends over 1% lower as AI worries persist

ETMarkets.com

Dow Jones Industrial Average rose 221.88 points, or 0.43%, to 51,992.19. The S&P 500 fell 37.80 points, or 0.50%, to 7,542.27, while the Nasdaq Composite declined 272.68 points, or 1.07%, to 25,164.32.

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Apple, Oracle weigh on market sentiment

Apple declined ahead of its quarterly earnings announcement after the closing bell, with investors watching the impact of rising memory chip costs on the iPhone maker. The results come at a time when technology companies are facing greater scrutiny over the returns from their growing investments in artificial intelligence, Reuters reporte

Oracle shares also fell after regulatory filings revealed plans to raise $20 billion through debt and a share sale. The move highlighted concerns about companies relying on borrowing to finance large scale infrastructure investments as funding costs rise.

The broader technology sector remained under pressure following October's selloff. The Nasdaq had lost 5.3% last month, with concerns that spending on AI infrastructure was growing faster than the cash these investments could generate.

Monday's recovery attempt reflected a "buy the dip" reaction, said Jake Dollarhide, chief executive of Longbow Asset Management in Tulsa, Oklahoma, according to Reuters.

"Companies have to realize there's a limit to how much they spend and what it means in terms of enhanced shareholder value. At some point, there is no additional value add, just expense," Dollarhide said.

Oil falls as Iran signals openness to talks

Falling crude prices provided some relief to markets after Iran indicated it was open to peace talks with the US. The eight month conflict in the Middle East had kept energy prices elevated and fuelled inflation concerns.

Longer dated US Treasury yields also moved lower, reflecting changing sentiment around energy prices and inflation.

However, investor caution remained evident ahead of Tuesday's US midterm elections and a busy earnings calendar. AMD fell ahead of its quarterly results, while Palantir slipped before reporting after the closing bell.

US manufacturing activity also picked up in October, with data pointing to solid domestic demand.