Nasdaq surges over 1%, rebounding after posting worst month since March 2025

U.S. stocks surged on Monday, as Wall Street rebounded after last week’s bruising sell-off caused by a hit to the artificial intelligence trade. Investors were looking ahead to quarterly results from Apple after the closing bell, with the iPhone giant emerging as a defensive shelter from the AI rout.

This week will also feature Tuesday’s pivotal U.S. midterm elections, the results of which could potentially see future policy changes affecting various sectors. 

At 10:25 ET (15:25 ET), the benchmark S&P 500 jumped 1% to 7,658.73 points, while the blue-chip Dow Jones Industrial Average surged 1.2% to 52,383.75 points. The tech-heavy NASDAQ Composite soared 1.3% to 25,762.01 points.

The NASDAQ on Friday slumped 2.9% to notch its worst day since early June. Moreover, the gauge cratered over 5% for October, its worst month since March 2025.

Apple emerges as capital-disciplined haven

Trading desks are treating Apple as an oasis of capital restraint amid growing fatigue over hyperscale AI spending. Unlike peers Alphabet and Meta Platforms which have unnerved credit and equity markets by pouring tens of billions into datacenters and custom silicon with uncertain payback horizons, Apple’s lighter infrastructure footprint has preserved its massive free-cash-flow engine.

Apple shares have climbed for four consecutive months and are up nearly 30% year-to-date, propelling the company’s market capitalization above the $5 trillion threshold and restoring its title as the world’s most valuable publicly traded company.

When John Ternus hosts his first quarterly earnings call as chief executive on Monday, traders will look for confirmation that high-margin device refreshes and services growth can sustain earnings momentum without the margin-dilutive infrastructure spending dragging down mega-cap rivals. Palantir Technologies and Berkshire Hathaway are also slated to report later in the session.

Bruised chipmakers face high hurdle with AMD

Intel cratered by a record 30% after issuing a downbeat forecast, triggering a sharp sector-wide re-pricing that dragged Advanced Micro Devices down nearly 11%. AMD, which reports quarterly figures on Tuesday, now faces a skeptical market eager to see whether its data-center accelerators are yielding profitable enterprise adoption or falling victim to corporate budget tightening.

The contrast between resilient consumer platforms and hardware suppliers underscores the divergence that defined October.

The Nasdaq Composite tumbled more than 5% last month as AI multiples compressed, while the S&P 500 fell 0.9%. Conversely, rotational flows into traditional defensive and cash-generative equities helped the Dow Jones Industrial Average gain 1.7%.

Midterm elections and labor data loom over risk appetite

Beyond corporate scorecards, trading desks are positioning for significant political and macroeconomic catalysts over the coming days.

Voters head to the polls on Tuesday for the U.S. midterm elections, with all 435 seats in the House of Representatives and 35 Senate seats on the ballot. President Donald Trump and the Republican party confront a challenging electoral terrain, burdened by consumer frustration over persistent gasoline inflation and the protracted conflict with Iran, with recent polling placing Trump’s approval rating at 31%.

A potential Democratic sweep of the House or both chambers could stall legislative initiatives, complicate infrastructure investment, and inject fresh friction into upcoming federal debt-ceiling negotiations.

The political uncertainty will be compounded at the end of the week by the October nonfarm payrolls report on Friday, which will provide the Federal Reserve with crucial labor market guidance as money markets continue to price a 78% probability of a 25-basis-point interest-rate increase in December.

Ambar Warrick and Pranav Kashyap contributed to this article