Inflation Test: CPI Takes Center Stage 10/11/2026
Market Wrap
Wall Street roared back Monday after last week's bruising technology selloff, with falling oil prices easing inflation worries and investors returning to equities. The rebound was broad despite fresh pressure on Nvidia as questions surrounding its chief executive continued to weigh on the stock.
The S&P 500 jumped 2.35% to 7,549.94, its strongest daily advance since April. The Nasdaq Composite climbed 2.74% to 25,253.14, while the Dow Jones Industrial Average surged 1,104.02 points, or 2.15%, to 52,389.75. The Russell 2000 rallied 3.15% to 2,840.81.
All 11 S&P 500 sectors advanced, led by industrials and consumer discretionary stocks. Semiconductor shares recovered sharply: Advanced Micro Devices (AMD) surged 13.3%, Broadcom (AVGO) gained 8.8%, and the PHLX Semiconductor Index climbed 6.9%.
Nvidia (NVDA) was the notable exception, sliding about 4.3% as investors weighed an independent board investigation into whether CEO Jensen Huang had been targeted in an alleged foreign-intelligence operation. The inquiry added company-specific uncertainty to an already fragile AI trade.
Energy provided another powerful tailwind. Brent crude fell roughly 5.8% as hopes for progress in negotiations over Iran reduced fears of prolonged supply disruptions. Lower oil prices also helped temper near-term inflation concerns.
Monday's advance followed last week's sharp losses, when the Nasdaq declined approximately 3.4% and the S&P 500 lost 2.7%. Investors are reassessing the sustainability of AI capital expenditure and the prospect of stricter oversight of data-center development following the midterm elections.
Attention now turns to Tuesday's October consumer-price index. The NFIB Small Business Optimism Index and weekly ADP employment figures are also on the calendar. Earnings from TransDigm (TDG), Sea (SE), CoreWeave (CRWV) and Alcon (ALC) will provide additional company-specific catalysts.
Beyond Big Tech: Market Rotation Gains Momentum
The U.S. stock market is increasingly finding support outside its largest technology companies. Over the past month, the equal-weighted S&P 500 has outperformed the conventional market-cap-weighted index by its widest margin since 2009, according to market commentary, highlighting a notable shift in leadership.
A steep retreat in chipmakers and renewed doubts about the cost of artificial-intelligence infrastructure have weighed on the market's biggest names. Investors are questioning how quickly enormous spending on chips, data centers and computing power will translate into sustainable profits.
Last week's Democratic midterm victories added another layer of uncertainty. Traders are assessing whether a new Congress could increase scrutiny of energy-intensive data centers and impose tighter rules on AI development when lawmakers take office next year.
As technology and communication-services shares lost momentum, money flowed into healthcare, consumer staples, real estate and materials. The rotation suggests investors have not abandoned equities altogether, but are seeking opportunities in sectors with different earnings and valuation drivers.
The shift could also reflect a broader change in the market's assessment of interest rates. Higher yields reduce the present value of long-dated technology profits and raise financing costs for companies borrowing heavily to build AI infrastructure.
Tuesday's October CPI report is the next major test. Consensus expectations point to a 0.3% monthly rise in headline inflation and a 0.2% increase in core prices. A stronger reading, together with hawkish Fed commentary, could accelerate the move away from richly valued technology shares.
For now, the widening participation is an encouraging sign that gains need not depend on a handful of megacap stocks. Whether this broader leadership can last will depend on inflation, monetary policy and evidence that AI adoption is delivering productivity gains across the economy.
Stocks on the Move
- Advanced Micro Devices (AMD): Shares surged about 13.3% after an analyst upgrade and renewed optimism about the chipmaker's data-center growth outlook, helping lead a rebound in semiconductor stocks.
- Coherent (COHR): Shares jumped roughly 17% as investors returned to optical-networking and AI infrastructure suppliers following the previous week's technology selloff.
- Nvidia (NVDA): Shares fell about 4.3%, bucking the wider market rally, as investors assessed the board's investigation into allegations that CEO Jensen Huang was targeted by a foreign-intelligence effort.
- First Solar (FSLR): Shares declined nearly 5% following a price-target cut and concerns about the outlook for federal clean-energy tax incentives.
- Ionis Pharmaceuticals (IONS): Shares plunged more than 21% after the biotechnology company sharply reduced its revenue outlook for a key therapy.
- The Trade Desk (TTD): Shares advanced more than 15% ahead of its earnings report as investors positioned for a potential improvement in the digital advertising outlook.
Watchlist: AMD, AVGO, NVDA, COHR, FSLR, IONS, TTD, MU, MSFT, AAPL, CRWV, TDG, SE, ONON, MU, SNDK, IREN, SPCX
Key Economic Events Today
Economic Data (ET)
- 06:00 AM — USD NFIB Small Business Optimism Index
- 08:15 AM — USD ADP Weekly Employment Change
- 08:30 AM — USD CPI m/m, Core CPI m/m, CPI y/y
- 01:01 PM — USD 10-Year Treasury Note Auction
Earnings
Before Market Open: TransDigm Group (TDG), Sea Limited (SE), Venture Global (VG), On Holding (ONON)
After Market Close: CoreWeave (CRWV), Alcon (ALC), Petrobras (PBR), Ecopetrol (EC)
