Market Movers

The Nasdaq Composite fell 2.6% to 26,008.86 on October 22, its worst session since June, and the S&P 500 lost 1.21%, its worst since July. The Dow ended slightly higher. CNBC and Yahoo Finance tie the drop to renewed worries about AI spending after Meta's results, and to oil.

AMD fell more than 8%, Micron 6% and Nvidia about 4%. Neocloud CoreWeave dropped 10%. Power and equipment names linked to data centers fell hard: GE Vernova and Bloom Energy each lost more than 11% and Vistra more than 10%, CNBC reports.

Investors moved into bonds: the 10-year Treasury yield fell more than 17 basis points to about 4.97%, CNBC reports; Yahoo Finance said it was on track for the biggest one-day drop in more than two years.

Brent crude rose 4% to settle at $113.17 a barrel on October 22, its highest close since May 4, and U.S. West Texas Intermediate gained 2.4% to $99.47.

CNBC reports the jump followed a New York Times report, citing unnamed U.S. officials, that U.S. and Israeli militaries have drawn up plans for renewed strikes on Iran after next month's midterm elections. President Trump told reporters the U.S. is not negotiating with Iran and that something will happen "fairly soon." The U.S. also ordered non-emergency government staff and families to leave Saudi Arabia, citing rising Houthi attacks; Saudi state media said at least two people were killed in an attack on Dammam's airport.

Yahoo Finance notes Brent is up more than 50% since the Iran war began in late February. One fund manager quoted by CNBC argues households are less exposed to oil shocks than decades ago.

Credit markets stayed nervous about AI borrowers this week even as stocks bounced. On October 19, the yield on CoreWeave's 9.625% bond due 2032 was 14.9%, and the spread on its five-year credit default swaps was about 1,082 basis points; CNBC notes a spread above 1,000 is generally a sign of distress. Oracle's five-year CDS spread widened to 315 basis points.

Economist David Rosenberg called Oracle the "canary in the coal mine," noting that Oracle, Alphabet, Amazon and Meta have issued more than $228 billion of bonds this year. A Janus Henderson credit head said the moves look overdone.

On October 22, Nvidia CEO Jensen Huang told CNBC that demand for neoclouds is "off the charts" but "there's a scarcity of capital," adding, "That's going to get solved."

The yield on France's benchmark 10-year bond briefly rose above 5% on October 21, the first time since 2002, before settling just under it, CNBC reports.

The government is trying to pass its 2027 budget through a divided parliament, with Prime Minister Sébastien Lecornu targeting 54 billion euros in spending cuts, while violent protests demanding more spending on education and cost-of-living relief spread over the weekend. France's deficit was 5.1% of GDP at the end of last year; the EU, which has France under its excessive deficit procedure, wants it closer to 3%.

Finance minister Roland Lescure told RTL the government would use Article 49.3 of the constitution, which lets it adopt a bill without a vote, if lawmakers do not agree. Yahoo Finance noted on October 22 that France's 10-year yield was above the U.S. 10-year for the first time since 2013.

SpaceX (Nasdaq: SPCX) reported third-quarter revenue of $14.6 billion, up 161% from $5.6 billion a year earlier, with net income of $4.4 billion against a $1.1 billion loss, according to its earnings release on October 20.

CNBC reports that the AI unit, which SpaceX calls "Super Intelligence," is now its largest business: revenue rose about ninefold to $7.56 billion, helped by renting computing capacity to Google, Anthropic and others and by the Cursor acquisition. Starlink subscribers reached 13.6 million, and the launch business grew only slightly, to $1.77 billion. CFO Bret Johnsen guided first-quarter 2027 revenue to $33 billion to $37 billion, far above the roughly $22 billion analysts expected, per LSEG.

On the call, Elon Musk said a merger with Tesla would be a "good idea" and that both boards have formed special committees to discuss it. The shares climbed about 8% in extended trading after the release, CNBC reports.

Meta reported third-quarter revenue of $64.60 billion, up 26% and above the $63.37 billion analysts expected, and guided fourth-quarter revenue to $73 billion to $76 billion. The stock rose after hours on October 21 but fell almost 7% on October 22.

CNBC reports free cash flow was negative $2.12 billion in the quarter, and Meta raised the floor of its full-year capital spending forecast to $135 billion to $145 billion (from a $130 billion bottom). The spread on Meta's five-year credit default swaps hit an all-time high.

Meta also announced a nonvoting Class C stock, to be distributed to all shareholders as a dividend starting January 2027, which CNBC describes as effectively a 2-for-1 split. Meta says it is meant to keep its "founder-led structure" and help finance growth. The SEC filing says Mark Zuckerberg could leave California if the proposed state wealth tax passes, and that he committed to stay for eight years as part of the new stock plan. Meta's workforce shrank 12% in the quarter to 66,000.

Netflix reported third-quarter earnings of 87 cents a share, above the 82 cents analysts expected, on revenue of $12.87 billion, in line, on October 20. Revenue was up almost 12%, which Netflix attributed to membership growth and March price increases.

Netflix narrowed its 2026 revenue forecast to $51.1 billion, the low end of its earlier range and below the $51.2 billion analysts expected, per LSEG, and lowered its 2026 ad-revenue outlook to about $2.7 billion from about $3 billion, citing a slower rollout of some ad products. It expects last week's job cuts to reduce fourth-quarter operating margin by about 120 basis points.

"We know there's some investor concern about our view hours growth," the shareholder letter said, adding that engagement "remains healthy." The stock fell more than 5% on October 21, CNBC reports. Screen Daily notes India view hours rose 24% year over year.

Tesla reported third-quarter adjusted earnings of 48 cents a share on revenue of $28.05 billion, both above LSEG estimates, on October 21. Automotive revenue fell 3% to $20.56 billion and energy revenue fell 16%, while services and other revenue rose 33%. Tesla cited lower average prices and trouble securing battery supplies.

Net income attributable to shareholders fell 29% to $787 million. CNBC reports capital spending more than doubled to $3.73 billion, driven by Optimus robots and other AI work, and free cash flow fell 62% to $1.53 billion. Active FSD subscriptions rose 67% to 1.74 million.

Musk said the driverless Robotaxi fleet should start contributing to results in 2027, and declined to add to his SpaceX merger comments from the day before. Shares slid more than 3% after hours and ended about 3% lower on October 22, per Yahoo Finance.

Salesforce announced on October 20 a definitive agreement to acquire Braze, a customer engagement platform, for about $5.66 billion in enterprise value. Braze Class A holders will receive $47.50 per share in cash.

Braze shares had closed at $30.04 the day before; they rose more than 51% to $45.57, CNBC reports. Salesforce says Braze's real-time messaging across apps, websites, email, SMS and WhatsApp will be combined with its Marketing Cloud, CRM and Data 360, and frames the deal as part of a shift to AI agents in marketing. The deal is expected to close in Salesforce's fiscal 2028, subject to shareholder and regulatory approvals.

CNBC notes it comes months after Salesforce agreed to buy AI customer-service platform Fin for about $3.6 billion.

Shares of South Korean AI services company Elice Group fell about 30% on their first day of trading on October 20, last trading at 63,600 won against an IPO price of 90,500 won, CNBC reports. The IPO raised 201.1 billion won (about $150 million), mostly for portable modular data centers.

Analysts noted the deal was priced on October 6, before the recent sell-off in AI stocks, even though institutional orders were 388.84 times the shares on offer. CNBC lists other AI data-center listings shelved this month: Nvidia-backed Firmus in Australia, a Singapore REIT IPO from Blackstone-backed AirTrunk, and SoftBank's SB Energy.

Elice says first-half revenue tripled to 34 billion won with a 10 billion won operating profit. "Elice's debut shows the AI infrastructure trade has moved from 'build at any cost' to 'who is paying and for how long'," said Shenton Research's Ke Yan.

Trading in blockchain versions of stocks is growing fast outside the U.S. Bitwise Asset Management's quarterly report says tokenized stock volume on Robinhood Chain went from $526 million in July to $11.31 billion in September, CNBC reports.

In the U.S., companies are pushing back. On October 19, OKXICE, the tokenized-securities venue launched by crypto exchange OKX and NYSE owner Intercontinental Exchange, disclosed objections from Goldman Sachs, Microsoft, Qualcomm, Caterpillar, McDonald's, Western Digital and Alphabet, adding to earlier objectors including CoreWeave, UnitedHealth and Broadcom.

CNBC says the SEC's innovation exemption last month created a temporary path for tokenized stocks in the U.S. that requires companies be able to object. The debate centers on whether token holders should get the same rights as shareholders, including voting.

Moderna shares dropped as much as 25% on October 22 after partial data on its melanoma vaccine with Merck leaked; Merck shares also fell, CNBC reports. Yahoo Finance said it put Moderna on pace for its worst day since its 2018 IPO.

The full phase 3 data, released later that day, showed the personalized vaccine, intismeran autogene, plus Merck's Keytruda cut the risk of recurrence or death by 42% versus Keytruda alone in certain high-risk patients. About 82% of patients on the combination were alive without recurrence after two years, versus 70% on Keytruda alone. The companies say it is too early to know whether it extends overall survival.

Analysts at BMO and UBS called the data strong and said the drop likely reflected inflated expectations. Detailed results are due at the European Society for Medical Oncology meeting this weekend.