Signs of a breakthrough in U.S.-Iran diplomacy sent oil prices plunging about 7%, their biggest one-day drop in three months, lifting the Dow and small- and mid-cap stocks. Tech stocks remained under pressure, with the Nasdaq falling another 1%. Marvell announced an all-stock acquisition of Lumentum, sending both stocks sharply lower as the selloff in AI infrastructure stocks continued. After the bell, Apple reported record quarterly revenue of $114.5 billion, beating expectations, but its shares still fell about 4%. Palantir's revenue grew 63%, also beating expectations, but its stock rose initially before falling. Today is Election Day for the U.S. midterms, and AMD reports earnings tonight.
Dow rises, Nasdaq falls as money flows faster into the old economy
On Monday, the Dow rose 0.41% to close at 51983.98; the S&P 500 fell 0.51% to 7541.40; and the Nasdaq dropped 1.07% to 25164.32. The Dow and Nasdaq diverged by 1.5 percentage points, reflecting a shift in funds away from high-valuation tech stocks and toward traditional sectors with more reliable cash flows.
The equal-weight S&P 500 ETF (RSP) rose 0.76%, outperforming the market-cap-weighted index by more than a percentage point for the fourth consecutive week. The VIX rose 8.91%, climbing back above 20 to close at 21.15. Volatility continued to rise even as the Dow finished higher.
At the sector level, plunging oil prices benefited consumer and industrial stocks, with consumer discretionary leading the gains. Energy stocks fell sharply, weighed down by oil prices. Information technology led the declines once again, losing nearly 3% amid selling over multiple consecutive trading sessions.
Among the Magnificent Seven, Nvidia turned an early gain into a loss, weighing on the S&P 500 late in the session. Microsoft fell 0.50%, and Apple fell 0.89% (with further moves after hours following its earnings report). Tesla extended its recent strength, rising 7.41%.
The S&P 500 closed at 7541.40, its lowest level since July 31, and is down 3.55% from its record high of 7818.93 on October 6.
Marvell to acquire Lumentum; AI infrastructure sell-off continues
Marvell announced an all-stock acquisition of optical communications leader Lumentum, with each Lumentum share exchangeable for 4.5 shares of Marvell. Based on Marvellโs closing price last Friday, the deal valued Lumentum at about $883 per share. But both stocks plunged after the announcement, bringing the actual implied offer value down to about $771 by Mondayโs close.
Marvell fell 12.72% to $171.41, while Lumentum dropped 18.59% to $684.40. Nvidia had previously invested $2 billion in each company, and Lumentumโs CEO had said that optical networking capacity was sold out through early 2029.
The deal is expected to close in the first half of 2028 and would give Marvell end-to-end capabilities spanning custom chips to optical modules. But the market reaction was clear: at a time when AI capital spending is already making investors uneasy, an acquisition worth nearly $100 billion adds to the bill rather than solving the problem.
The Philadelphia Semiconductor Index continued to fall. Including Fridayโs plunge, it has lost nearly 10% over two trading sessions.
Apple posts record revenue but falls 4% after hours; Palantir rises, then retreats
Apple reported results after the close for the fourth quarter of fiscal 2026 (ended September 26). Revenue was $114.5 billion, up 12% year over year and a September-quarter record. Earnings per share were $2.10, up 14%, including about $0.05 from tariff refunds. Both figures topped market expectations.
iPhone revenue was $57.58 billion, a record for the period, aided by the first week of iPhone 18 Pro series sales (launched September 18, with nine days of sales included). Services revenue reached a record $31.57 billion. Mac revenue was $10.79 billion. Full-year revenue reached $479 billion, making it Appleโs best fiscal year ever.
Gross margin was 47.9%, including about one percentage point from tariff refunds. Excluding those refunds, it was below last quarterโs 50.1%. Rising memory chip prices and supply chain constraints continue to erode margins.
Despite results beating expectations across the board, Apple fell about 3.8% after hours. Market concerns centered on three factors: revenue topped expectations by only a modest amount (about $1 billion above consensus), the iPhone Duo faces severe supply bottlenecks, and the company offered no specific guidance for the next quarter. This was the first earnings report since new CEO John Ternus took office.
Palantir also reported third-quarter results after the close. Revenue was $1.18 billion, up 63% year over year and above expectations. Adjusted earnings per share were $0.21, beating the expected $0.17. U.S. commercial revenue grew 121%, and U.S. government revenue rose 52%. Total contract value reached $2.76 billion, up 151% year over year. The company raised its full-year guidance. But the stock initially rose 3% after hours before retreating, ultimately falling about 3.6%. Prominent investor Michael Burry had previously disclosed holding put options on Palantir, adding to selling pressure.
Oil plunges 7% as U.S.-Iran diplomatic signals spark biggest drop in three months
WTI crude plunged about 7.3% to around $96.50 a barrel, while Brent fell about 7.8% to around $104.60 a barrel. Both posted their biggest one-day declines in three months.
The immediate trigger was positive diplomatic signals between the U.S. and Iran. On the third day of U.S.-Iran talks in Doha, Tehran proposed reopening the Strait of Hormuz within two days. Markets interpreted this as a sign that the war-risk premium could fade quickly, sending crude prices sharply lower from near a seven-week high last Friday.
The plunge in oil prices had a knock-on effect. Inflation expectations cooled and long-term Treasury yields fell: the 10-year yield dropped about 3.5 basis points to 4.893%, and the 30-year yield fell about 4 basis points to 5.268%. The 2-year yield was little changed at 4.581%.
Gold rebounded from a one-year low last Friday, with December futures gaining about 1.5% to $3,957 an ounce. Lower oil prices eased inflation concerns, while falling yields reduced the opportunity cost of holding gold. Silver rose 4.2%.
Bitcoin remained under pressure amid the fallout from the Binance hack, closing around $76,700, down about 1.3%. Ethereum traded near $2,200. The ISM manufacturing PMI came in at 55.5, stronger than expected and in expansion territory for a third consecutive month, while the prices-paid index remained elevated. The U.S. Dollar Index closed around 101.9, little changed.
What to watch today
All times below are Beijing time.
Today: U.S. midterm election voting day. All 435 House seats and 35 Senate seats are up for election. The results will determine control of Congress for the second half of Trumpโs term, directly affecting the direction of tax, fiscal, AI regulation, and cryptocurrency policies. Historical data show that the S&P 500 has risen in the 12 months after midterm elections 95% of the time (since 1938). Results may begin coming in on Wednesday morning Beijing time, but counting in key swing races could take several days.
Tonight after the close: AMD reports third-quarter earnings. The market expects revenue of about $13.1 billion, up 42% year over year, and earnings per share of about $1.94, up 62%. After Intelโs steep drop last week, the performance of AMDโs data center GPU and AI chip businesses will be key to semiconductor sector confidence.
Other earnings this week: Qualcomm (Wednesday after the close), Arm (Wednesday after the close), and Arista Networks (Thursday after the close). More data points from the AI infrastructure chain are coming soon.
Friday at 21:30: U.S. October nonfarm payrolls report. Employment rose by just 29,000 in September, as the labor market continued to cool. The data will directly affect market pricing for a 25-basis-point Fed rate hike in December. #็พๅฝไธญๆ้ไธพๅ่ฎกๆถ๏ผ็พ่กๅๅผ็ชๅฃๅทฒๅผๅฏ๏ผ