[BRIEFING.COM] The major averages finished Tuesday's session with modest changes, recovering from more pronounced intraday weakness as a late improvement in semiconductor stocks helped stabilize the broader market. The S&P 500 (flat) ended near its unchanged level, while the Nasdaq Composite (-0.2%) and DJIA (-0.4%) registered small losses. The relatively quiet finish masked another session of uneven performance across individual stocks and sectors.

Semiconductor stocks were a central influence on today's trading, initially extending yesterday's decline amid concerns about increased competition from Chinese memory chipmakers. The PHLX Semiconductor Index (-0.2%) fell as much as 3.1% shortly after the open, reflecting pressure that also contributed to a 5.5% overnight decline in South Korea's Kospi. Memory names such as Micron (MU 953.19, -35.85, -3.62%) remained under pressure, but selling across the broader semiconductor group eased considerably as the session progressed. The recovery helped the information technology sector (+0.1%) finish with a slim gain after spending much of the morning in negative territory.

The improvement in semiconductor stocks also helped the Nasdaq Composite recover much of its earlier decline, although the index ultimately finished slightly lower. Five S&P 500 sectors closed higher, led by the energy sector (+1.8%), which continued its recent stretch of outperformance despite relatively little movement in crude oil prices. Refiners were particularly strong, with Marathon Petroleum (MPC 476.98, +18.17, +3.96%) and Valero Energy (VLO 456.46, +20.46, +4.69%) reaching fresh record highs. WTI crude settled $0.29 higher (+0.3%) at $94.06 per barrel.

The communication services sector (+0.9%) was another standout, benefiting from continued strength in Meta Platforms (META 762.50, +19.54, +2.63%).

On the other side of the sector standings, the health care sector (-1.3%) finished with the largest decline, weighed down by Johnson & Johnson (JNJ 248.61, -15.12, -5.73%) following its Q3 earnings report. Disappointing MedTech growth and a modest increase to full-year guidance overshadowed stronger pharmaceutical sales, leaving JNJ among the weakest DJIA components.

The industrials sector (-0.3%) also staged a notable recovery from its earlier losses, moving higher alongside semiconductor stocks after falling more than 1.0% around midday. However, Caterpillar (CAT 772.78, -26.59, -3.33%) remained a significant drag on the price-weighted DJIA as its recent retreat continued.

Meanwhile, the financials sector (-0.4%) finished modestly lower following mixed reactions to earnings from several major banks. Goldman Sachs (GS 891.91, -2.04, -0.23%) and JPMorgan Chase (JPM 331.43, -2.87, -0.86%) ceded earlier gains, while Citigroup (C 124.53, -7.39, -5.60%) and b80.74, -2.58, -3.10%) faced more pronounced pressure. Bank earnings remain in focus tomorrow, with Bank of America (BAC 53.96, -0.62, -1.14%) and Morgan Stanley (MS 186.66, -3.36, -1.77%) scheduled to report before the open.

Elsewhere, the Russell 2000 (-0.4%) continued to trail the S&P 500, while the S&P Mid Cap 400 (+0.1%) managed a slight gain.

On the geopolitical front, Axios reported that Israeli Prime Minister Benjamin Netanyahu and President Trump discussed the possibility of renewed strikes against Iran before the midterm elections. Trump reportedly indicated that he would not authorize additional strikes before the elections, although the Pentagon remains prepared should that position change.

Ultimately, the afternoon recovery in semiconductors and other technology-related stocks prevented the earlier selling from producing a more substantial decline in the major averages. Nevertheless, the uneven sector performance and continued weakness in select heavyweight stocks left the broader market with little directional momentum by the close.

U.S. Treasuries had a mostly higher start to the holiday-shortened week, but the front end finished flat after reversing from a higher start while longer tenors held onto a portion of their starting gains. The 2-year note yield finished unchanged at 4.79%, and the 10-year note yield settled down two basis points to 5.22%. 

• Nasdaq Composite: +17.1% YTD
• S&P 500: +14.0% YTD
• Russell 2000: +12.2% YTD
• S&P Mid Cap 400: +10.7% YTD
• DJIA: +7.5% YTD

Reviewing today's data: 

• Sep NFIB Small Business Optimism 97.9 (Briefing.com consensus 98.0; Prior 98.7)
• Existing home sales increased 1.5% month-over-month in September to a seasonally adjusted annual rate of 3.99 million (Briefing.com consensus 3.96 million) from a downwardly revised 3.93 million (from 3.98 million) in August. Sales were down 2.2% on a year-over-year basis.
  
  • The key takeaway from the report is that year-over-year sales were down in all four regions, reflecting persistent headwinds from high mortgage rates. As a result, August and September have been the slowest two months for home sales so far in 2026.

[BRIEFING.COM] The S&P 500 (+0.1%), Nasdaq Composite (-0.1%), and DJIA (-0.2%) remain on track for a subdued finish as stocks continue to move in a narrow range this afternoon.

On the geopolitical front, Israeli Prime Minister Benjamin Netanyahu and President Trump discussed the possibility of resuming military strikes against Iran before the midterm elections, but Trump indicated he would not authorize further strikes until after the elections, although the Pentagon remains prepared should he change his mind, according to Axios.

Crude oil futures settled today's session $0.29 higher (+0.3%) at $94.06 barrel.

[BRIEFING.COM] The S&P 500 (-0.1%), Nasdaq Composite (-0.2%), and DJIA (-0.3%) are little changed from previous levels as the market enters the final hour of the session.

Tomorrow morning, the market will hear from Morgan Stanley (MS 187.34, -2.68, -1.41%), which heads into its Q3 earnings report following a strong Q2. However, today's bank earnings highlighted sequential moderation in fixed income and investment banking, even as equities remained strong. Investors will be watching whether Morgan Stanley maintained its equities momentum while its Wealth Management business continued generating strong asset flows and fee-based revenue growth.

Bank of America's (BAC 54.13, -0.45, -0.83%) Q3 report, also before the open tomorrow, will test whether deposit and loan growth, fixed-rate asset repricing, and continued fee strength can sustain NII growth near the upper end of its 6%--8% FY26 outlook. Investors will focus on trading and investment-banking revenue following a strong Q2, expense discipline and operating leverage, and whether stable credit quality supports further improvement in profitability.

[BRIEFING.COM] The S&P 500 has returned to its unchanged level, overcoming its modest starting loss while the Nasdaq (-0.1%) has a bit more distance to cover before reclaiming its unchanged level.

The Nasdaq has closed the bulk of today's performance gap to the broader market thanks to a rebound in chip stocks, but the PHLX Semiconductor Index remains down 0.6% for the day and down 3.2% for the week. The SOX Index started the day on a weak note after South Korea's Kospi lost 5.5% overnight. Two chip giants-Samsung and SK Hynix (SKHY 156.04, -6.19, -3.82%)-account for just over 50% of the Kospi index, so the performance of that market is key to shaping sentiment surrounding chip stocks in general. With today's rise off lows in chip stocks during the U.S. session, investors will be curious to see if the Kospi also recovers from its poor Tuesday showing.

Elsewhere, Treasuries are on track for a mixed finish with 5s and longer tenors tracking modest gains while the short end lags. The 10-yr yield is down two basis points at 5.22% while the 2-yr yield is up one basis point at 4.80%.

[BRIEFING.COM] The major averages remain modestly lower, with losses ranging from roughly 0.2% to 0.5%. The notable change is beneath the surface: the Philadelphia Semiconductor Index and S&P 500 information technology sector are well off their session lows, reducing some of the pressure seen earlier in the day.

Semiconductor stocks, particularly memory names such as Micron (MU 935.58, -53.46, -5.41%), remain weak amid concern about increased competition from China's ChangXin Memory Technologies (CXMT) that had an outsized impact on South Korea's Kospi (-5.5%) overnight. The Philadelphia Semiconductor Index had been down as much as 3.1% shortly after today's open but is now down 1.3%.

The recovery from the lows suggests investors are distinguishing the memory-specific competitive concern from the outlook for the broader technology sector. Losses remain concentrated in the more directly exposed chip names rather than spreading uniformly across information technology, which has allowed both the semiconductor group and the broader sector to retrace part of their early declines. Even so, the major averages remain in negative territory, with smaller stocks still lagging.

[BRIEFING.COM] Despite a relatively busy morning of earnings and corporate news items, stocks have had a fairly quiet session, keeping the major averages modestly lower early in the afternoon.

Applied Materials (AMAT 457.02, -40.51, -8.14%), however, is one of the worst-performing S&P 500 components after the company outlined ambitious long-term growth targets, including plans to double revenue over the next five years and expand its manufacturing and R&D capacity through 2030 to capitalize on AI-driven semiconductor demand.

[BRIEFING.COM] The major averages have recovered much of their earlier losses, leaving the S&P 500 (-0.1%), Nasdaq Composite (-0.1%), and DJIA (-0.3%) trading near their flat lines after a morning marked by uneven sector performance and another round of selling in semiconductor stocks.

The improvement has been driven in part by a rebound in technology shares from their morning lows. The PHLX Semiconductor Index (-0.8%) has pared a decline that exceeded 2.5% earlier in the session, helping the information technology sector (flat) return to unchanged. Memory chipmakers, including Micron (MU 942.46, -46.58, -4.71%), remain under pressure amid concerns about technological advances by Chinese competitors, although strength elsewhere in the sector, including Apple (AAPL 344.28, +3.31, +0.97%) reaching fresh all-time highs, has helped offset some of that weakness.

The communication services sector (+1.1%) is providing another source of support, with Meta Platforms (META 762.32, +19.36, +2.61%) and Alphabet (GOOG 351.32, +2.35, +0.67%) extending their recent gains.

The energy sector (+1.2%) is also outperforming, continuing a strong stretch that has lifted the sector 8.9% in October and nearly 50% year to date. Refiners have been particularly strong, with Marathon Petroleum (MPC 470.46, +11.66, +2.54%) and Valero Energy (VLO 450.50, +14.50, +3.33%) reaching fresh record highs. The advance comes despite relatively little movement in crude oil prices, with WTI modestly higher after recovering from overnight losses.

Elsewhere, weakness in the industrials sector (-0.9%) and health care sector (-1.2%) continues to weigh on the broader market. Caterpillar (CAT 763.33, -36.04, -4.51%) is extending its recent decline amid elevated Treasury yields, while electrical equipment names such as Generac (GNRC 212.19, -6.18, -2.83%) are also struggling as semiconductors retreat. In the health care sector, Johnson & Johnson (JNJ 245.46, -18.26, -6.93%)is a notable drag following its Q3 earnings report, as disappointing MedTech growth and a relatively modest increase to full-year guidance overshadowed stronger pharmaceutical sales.

The financials sector (-0.1%) is little changed as investors sort through a mixed batch of quarterly reports from major banks. Goldman Sachs (GS 900.30, +6.35, +0.71%) and JPMorgan Chase (JPM 335.45, +1.15, +0.35%) are holding modest gains, while Citigroup (C 127.43, -4.49, -3.40%) and Wells Fargo (WFC 81.98, -1.34, -1.61%) move lower.

Beyond the largest stocks, participation remains less encouraging. The Russell 2000 (-0.5%) and S&P Mid Cap 400 (-0.3%) are trailing the major averages, extending their recent underperformance. Advancers and decliners have been relatively balanced on the NYSE, while declining issues have held a sizable advantage on the Nasdaq. With Treasury yields and crude oil prices showing limited movement, company-specific developments and divergent performance across equity groups remain the main influences on today's trading.

Reviewing today's data:

• Sep NFIB Small Business Optimism 97.9 (Briefing.com consensus 98.0; Prior 98.7)
• Existing home sales increased 1.5% month-over-month in September to a seasonally adjusted annual rate of 3.99 million (Briefing.com consensus 3.96 million) from a downwardly revised 3.93 million (from 3.98 million) in August. Sales were down 2.2% on a year-over-year basis.
  
  • The key takeaway from the report is that year-over-year sales were down in all four regions, reflecting persistent headwinds from high mortgage rates. As a result, August and September have been the slowest two months for home sales so far in 2026.

[BRIEFING.COM] The S&P 500 (-0.1%), Nasdaq Composite (-0.1%), and DJIA (-0.3%) remain modestly lower just after midday. 

The health care sector (-1.3%) continues to jockey with the industrials sector (-1.0%) for the position of worst-performing S&P 500 sector, weighed down by weakness in Johnson & Johnson (JNJ), which is also the worst-performing DJIA component.

Johnson & Johnson (JNJ 245.62, -18.11, -6.87%) is under pressure following its Q3 earnings report, as disappointing growth in its MedTech business and a modest increase to full-year guidance overshadowed solid pharmaceutical sales growth. The company's earnings outlook also remains pressured by investments in its drug pipeline.

[BRIEFING.COM] The major averages remain near their session lows at midday.

The industrials sector (-1.3%) is now the worst-performing S&P 500 sector, with pronounced weakness in electrical equipment names such as Generac (GNRC 209.73, -8.64, -3.96%) accompanying another retreat in semiconductor stocks.

Caterpillar (CAT 759.27, -40.10, -5.02%), the sector's largest component, is also extending its recent decline amid elevated Treasury yields. After a strong start to the year, the stock has fallen below both its 50-day (820.31) and 200-day (803.30) moving averages.

[BRIEFING.COM] The major averages are moving lower this morning, with the S&P 500 (-0.2%), Nasdaq Composite (-0.4%), and DJIA (-0.2%) facing increasing pressure as continued selling in semiconductor stocks outweighs gains elsewhere in the market.

The pressure is concentrated in the information technology sector (-0.6%), where the PHLX Semiconductor Index is down 2.6%. Memory chipmakers, including Micron (MU 934.54, -54.50, -5.51%), remain under pressure amid reports of technological advances by Chinese competitors. The weakness has been less pronounced across other technology stocks, helping limit the sector's overall decline.

Meanwhile, the communication services sector (+1.5%) continues to benefit from strength in its largest constituents, particularly Meta Platforms (META 764.40, +21.44, +2.89%) and Alphabet (GOOG 352.45, +3.48, +1.00%).

The energy sector (+1.3%) is also outperforming despite only a slight increase in crude oil prices, while the financials sector (+0.2%) is holding a modest gain as investors digest quarterly results from several major banks.

Participation remains mixed, with seven S&P 500 sectors in negative territory. Advancers and decliners are nearly evenly matched on the NYSE, but declining issues outnumber advancing issues by almost 2-to-1 on the Nasdaq.

Treasury yields and crude oil prices are showing little movement, keeping the focus largely on the uneven performance across equity groups. Smaller stocks are also lagging, with the Russell 2000 (-0.5%) and S&P Mid Cap 400 (-0.3%) extending their recent pattern of underperformance.

[BRIEFING.COM] The major averages are now slightly lower for the session. 

The financials sector (flat) is little changed this morning, with some early volatility among major banks following the release of their Q3 earnings reports.

JPMorgan Chase (JPM 336.96, +2.66, +0.80%) is trading higher after reporting solid revenue growth, supported by expanding loan and deposit balances, stronger fee income, and robust equity trading activity. The bank also provided an encouraging preliminary outlook for FY27 net interest income, although rising expenses and some moderation in capital markets activity remain considerations.

Goldman Sachs (GS 902.99, +9.04, +1.01%) is also trading higher after comfortably exceeding earnings expectations, with revenue climbing 23% yr/yr. Strong equity trading and investment banking activity drove the results, while growth in asset and wealth management provided additional support. However, softer fixed-income trading activity and higher operating expenses tempered some of the positive developments.

[BRIEFING.COM] The DJIA (+0.1%) remains a touch above its baseline while the S&P 500 (-0.1%) and Nasdaq Composite (-0.1%) are slightly lower. 

Existing home sales increased 1.5% month-over-month in September to a seasonally adjusted annual rate of 3.99 million (Briefing.com consensus 3.96 million) from a downwardly revised 3.93 million (from 3.98 million) in August. Sales were down 2.2% on a year-over-year basis.

The key takeaway from the report is that year-over-year sales were down in all four regions, reflecting persistent headwinds from high mortgage rates. As a result, August and September have been the slowest two months for home sales so far in 2026.

[BRIEFING.COM] The S&P 500 (-0.1%), Nasdaq Composite (+0.1%), and DJIA (-0.1%) are little changed in an opening move that is relatively similar to yesterday's session.

Stocks are mixed, though weakness in semiconductor names continues to hold the major averages back. The PHLX Semiconductor index is down 1.5%, with memory names such as  Micron (MU 946.71, -42.33, -4.28%) among the underperformers amid reports of increased competition from Chinese companies.

The broader information technology sector (+0.1%) is up modestly, however, as the lingering semiconductor weakness does not extend to across all tech and mega-cap names.

Once again, the communication services sector (+1.8%) is at the top of the sector standings as Meta Platforms (META 768.08, +25.12, +3.38%) and Alphabet (GOOG 352.12, +3.15, +0.90%) continue to move higher.

Elsewhere, the energy sector (+1.1%) holds a solid gain as oil moves off its overnight lows, though it remains modestly lower for the session.

Meanwhile, the financials sector (-0.6%) is modestly lower following a mixed batch of earnings reports this morning, with Wells Fargo (WFC 80.46, -2.86, -3.43%) a notable laggard.

Johnson & Johnson (JNJ 250.42, -13.31, -5.05%) is another laggard after earnings, weighing on the health care sector (-1.1%), which is the worst performer so far.

Just released, existing home sales increased to 3.99 million in September (Briefing.com consensus 3.96 million) from a downwardly revised previous level of 3.93 million (from 3.99 million).

The S&P 500 futures currently trade six points below fair value.

Asian markets finished mostly lower on Tuesday, with concerns surrounding AI valuations, rising borrowing costs, and heavy capital spending driving a sharp selloff across the region's major technology markets. Japan's Nikkei 225 tumbled 1.8% for a fourth consecutive decline, with Kioxia Holdings (-13%), SoftBank Group (-9%), Tokyo Electron (-7%), Taiyo Yuden (-5%), and Advantest (-3%) leading the retreat, while September producer prices rose a weaker-than-expected 6.8% yr/yr. South Korea's KOSPI plunged 5.5%, with Samsung Electronics and SK Hynix under pressure after China's CXMT reported progress on a new memory-cell design, adding another competitive concern for the semiconductor industry. China's Shanghai Composite bucked the broader weakness with a 0.1% gain, while the Shenzhen Component slipped 0.3% to a more than one-year low as semiconductor shares traded mixed. Hong Kong's Hang Seng Index recovered from an early selloff to gain 0.3%, with Geely (+3%), Xiaomi (+2%), AIA (+2%), and Meituan (+1%) advancing. In Australia, business confidence deteriorated further in September, while investors also digested the minutes from the Reserve Bank of Australia's latest policy meeting.

• In economic data:
  • Japan's September PPI fell 0.3% m/m (expected 0.5%; prior -0.3%) and rose 6.8% yr/yr (expected 7.6%; prior 7.6%).
  • Japan's bank lending increased 5.3% yr/yr (expected 5.5%; prior 5.3%).
  • Australia's September NAB Business Confidence fell to -13 from -9.
  • Australia's September NAB Business Survey was unchanged at -1.
  • Minutes from the RBA's September meeting showed the Board unanimously raised the cash rate by 25 bps to 4.60%, citing mounting upside risks to inflation and indicating further tightening could be required.

European markets trade mostly higher on Tuesday, with lower oil prices and bond yields supporting sentiment while renewed concerns about AI valuations weigh on technology shares. Germany's DAX rises 0.3% for a third consecutive advance, with Zalando (+7%), Fresenius, Siemens Healthineers, Fresenius Medical Care, and Bayer (all +4% or more) among the leaders, while Infineon (-7%) tumbles amid concerns surrounding AI investment returns and increased competition from China's CXMT. Germany's annual inflation rate was confirmed at 3.3% in September, up from 2.9% in August and marking its highest level since December 2023. France's CAC 40 edges up 0.1%, with Socit Gnrale (+2%), L'Oral (+1%), and Danone (+1%) advancing, while STMicroelectronics (-5%) follows the broader semiconductor selloff and LVMH (-1%) retreats following weaker-than-expected third-quarter organic sales. London's FTSE 100 gains 0.6%, supported by HSBC (+1%), Lloyds Banking Group (+2%), Barclays (+2%), AstraZeneca (+2%), and GSK (+2%), while Whitbread (+2%) advances after reporting better-than-expected first-half profits. The broader STOXX Europe 600 rises 0.4%, while Italy's FTSE MIB gains 0.3% and Spain's IBEX 35 trades little changed.

• In economic data:
  • Germany's September CPI rose 0.6% m/m (expected 0.6%; prior 0.2%) and 3.3% yr/yr (expected 3.3%; prior 2.9%).
  • Germany's September HICP rose 0.6% m/m (expected 0.6%; prior 0.2%) and 3.3% yr/yr (expected 3.3%; prior 2.9%).
  • The U.K.'s September BRC Retail Sales Monitor increased 1.0% yr/yr (expected 0.8%; prior 0.5%).

Equity futures now point to a mixed open as semiconductor names continue to weigh on futures tied to the Nasdaq Composite while the market continues to assess a stream of earnings reports.

Citigroup (C 131.22, -0.70, -0.5%) beat EPS expectations by $0.20 and reported revenues in-line.

Equity futures point to a slighlty lower opening this morning, as investors assess the recent rise in Treasury yields and continued pressure on semiconductor stocks.

On the interest rate front, Fed Governor Christopher Waller said the increase in Treasury yields reflects stronger growth expectations rather than concerns about inflation, according to Reuters. Yields are easing this morning as trading resumes following yesterday's Columbus Day bond market closure, with a decline in crude oil prices providing some relief.

Overseas, European markets are mostly higher, supported by lower oil prices and bond yields. Asian technology markets, however, faced renewed selling pressure amid concerns about elevated AI valuations, substantial capital spending commitments, and growing competition in memory chips.

According to Bloomberg, China's CXMT has claimed a breakthrough in memory technology that could put it ahead of established manufacturers Samsung and SK Hynix, adding to concerns about competition in the industry. Meanwhile, global semiconductor stocks are also facing pressure following Financial Times reporting that Broadcom (AVGO) CEO Hock Tan compared aspects of the AI trade to gambling, adding to questions surrounding the sustainability of AI-related investment and valuations.

Meanwhile, Q3 earnings season is ramping up today, with several major banking and health care companies reporting results. The reports will provide an early look at corporate earnings trends as investors assess the outlook for the broader economy.

The NFIB Small Business Optimism Index slipped in September and was just below consensus. Existing home sales are due at 10:00 a.m. ET, while several Dow components are in focus following their quarterly reports.

On the U.S. data front:

• September NFIB Small Business Optimism 97.9 vs. 98.0 Briefing.com consensus; prior 98.7

Today's remaining economic calendar:

• 10:00 AM ET: September Existing Home Sales; Briefing.com consensus 3.96M; prior 3.98M
• 2:00 PM ET: September Treasury Budget; prior -$166.8B

In corporate news:

• Goldman Sachs (GS 926.00 +32.05, +3.6%) beat EPS expectations by $4.15 and beat revenue expectations.
• UnitedHealth (UNH 386.97, +8.45, +2.23%) is indicated higher after topping quarterly earnings and revenue expectations and raising its fiscal 2026 earnings outlook above consensus.
• Johnson & Johnson (JNJ 256.75, -6.98, -2.65%) beat the quarterly earnings estimate, reported revenue in line with expectations, and raised its outlook.
• JPMorgan Chase (JPM 337.00, +2.70, +0.81%) is indicated higher despite missing quarterly earnings and revenue estimates. Net interest income excluding Markets increased 6%.
• BP (BP 47.57, +0.84, +1.80%) is indicated higher following its earnings and guidance update.

Reviewing overnight developments:

According to Nikkei, Asian markets finished mostly lower as concerns about AI valuations, rising borrowing costs, and heavy capital spending weighed on major technology markets.

In news:

• South Korean semiconductor shares came under pressure after China's CXMT reported progress on a new memory-cell design, adding to competitive concerns for the industry.
• Minutes from the Reserve Bank of Australia's September meeting showed a unanimous 25-basis-point rate increase to 4.60%, with policymakers citing upside inflation risks and the potential need for further tightening.

In economic data:

• Japan's September PPI -0.3% m/m (expected 0.5%; prior -0.3%) and 6.8% yr/yr (expected 7.6%; prior 7.6%); Bank Lending 5.3% yr/yr (expected 5.5%; prior 5.3%)
• Australia's September NAB Business Confidence -13 (prior -9) and NAB Business Survey -1 (prior -1); Minutes from the RBA's September meeting showed the Board unanimously raised the cash rate by 25 bps to 4.60%, citing mounting upside risks to inflation and indicating further tightening could be required.

Equity Markets:

• Japan's Nikkei: -1.8%
• Hong Kong's Hang Seng: +0.3%
• China's Shanghai Composite: +0.1%
• India's Sensex: +1.5%
• South Korea's Kospi: -5.5%
• Australia's All Ordinaries: -0.2%

European markets are mostly higher, with lower oil prices and bond yields providing support while renewed concerns about AI valuations weigh on technology shares.

In news:

• Semiconductor shares are under pressure amid questions about AI investment returns and increased competition from China's memory-chip industry.
• Banking and health care shares are among the stronger groups in the region.

In economic data:

• Germany's September CPI 0.6% m/m (expected 0.6%; prior 0.2%) and 3.3% yr/yr (expected 3.3%; prior 2.9%); HICP 0.6% m/m (expected 0.6%; prior 0.2%) and 3.3% yr/yr (expected 3.3%; prior 2.9%)
• U.K.'s September BRC Retail Sales Monitor 1.0% yr/yr (expected 0.8%; prior 0.5%)

Equity Markets:

• STOXX Europe 600 : +0.4%
• Germany's DAX : +0.3%
• U.K.'s FTSE 100 : +0.6%
• France's CAC 40 : +0.1%
• Italy's FTSE MIB : +0.3%
• Spain's IBEX 35 : flat

[BRIEFING.COM] The major averages finished Monday's session mixed as continued weakness in semiconductor stocks offset gains across much of the broader market. The S&P 500 (-0.1%) and Nasdaq Composite (-0.4%) ended with modest losses, while the DJIA (+0.4%) outperformed. The Russell 2000 (-0.5%) and S&P Mid Cap 400 (-0.4%) also finished lower.

The market spent much of the session trading in relatively narrow ranges, with a lack of major headlines and anticipation surrounding the upcoming Q3 earnings season contributing to the subdued action. Still, the relatively quiet finish masked another pronounced divergence beneath the surface, as weakness in heavily weighted technology stocks contrasted with strength across several other sectors.

The information technology sector (-0.9%) was the biggest drag on the market, reflecting another sharp retreat in semiconductor stocks. The PHLX Semiconductor Index fell 2.7%, with NVIDIA (NVDA 226.32, -2.96, -1.29%) among the notable laggards. Memory stocks faced additional pressure following a CNBC report that China's CXMT plans to begin producing next-generation memory chips, potentially intensifying competition with U.S. and South Korean manufacturers. Micron (MU 989.04, -39.96, -3.88%) and Sandisk (SNDK 1487.33, -94.49, -5.97%) were among the weaker performers.

The selling also extended to other areas tied to the AI infrastructure buildout, including Lumentum (LITE 995.41, -107.94, -9.78%) and Ciena (CIEN 404.86, -44.91, -9.99%), which ranked among the S&P 500's worst performers. Weakness in data center power-related names Bloom Energy (BE 262.35, -18.15, -6.47%) and Generac (GNRC 218.38, -6.56, -2.92%) also weighed on the industrials sector (-0.1%).

The weakness in technology stocks was not universal, however. Apple (AAPL 340.97, +4.33, +1.29%) advanced, while Meta Platforms (META 742.96, +24.29, +3.38%) and Alphabet (GOOG 348.97, +1.11, +0.32%) helped lift the communication services sector (+1.1%). Meta was a particular standout following an Abab News report that Mark Zuckerberg hinted at a new "Watermelon" AI model in a recent interview. Wireless carriers also recovered some of Friday's losses, providing additional support to the sector.

Outside of technology, rising crude oil prices were another important influence on trading. WTI crude settled $1.85 higher (+2.0%) at $93.77 per barrel following an escalation in the conflict between Saudi Arabia and Houthi forces over the weekend. President Trump indicated that the U.S. could become involved in the conflict, adding to concerns about the geopolitical situation. The energy sector (+1.5%) benefited from the advance, extending its strong performance so far this month.

Higher oil prices, meanwhile, weighed on the consumer discretionary sector (-0.7%), which was among the day's weakest performers. Amazon (AMZN 259.53, -2.90, -1.11%) declined following a Wall Street Journal report that the company is discussing a roughly $7 billion acquisition of AI startup Decart. Chipotle Mexican Grill (CMG 30.40, -1.19, -3.75%) also struggled after CNBC reported that Starbucks (SBUX 92.28, +1.54, +1.69%) is not considering an acquisition of the restaurant chain, contradicting reports from last week.

Despite the sector's weakness, eBay (EBAY 114.65, +2.46, +2.19%) was a notable gainer after Morgan Stanley named the company its Top Pick and raised its price target to $132 from $127, citing growth opportunities in Live Commerce.

Elsewhere, the health care sector (+0.7%) posted a solid gain, while the consumer staples sector also enjoyed relative strength, helped by continued buying interest in Lamb Weston (LW 50.18, +2.31, +4.83%) following last week's better-than-expected earnings and increased guidance.

Financial stocks also attracted attention ahead of a busy week of earnings, with JPMorgan Chase (JPM 334.49, +1.50, +0.45%), Citigroup (C 131.93, +2.29, +1.77%), Goldman Sachs (GS 894.03, -1.29, -0.14%), and Wells Fargo (WFC 83.30, -0.25, -0.30%) scheduled to report quarterly results Tuesday.

The broader market held up relatively well despite another sizable semiconductor selloff and higher crude oil prices, but weakness in some of the market's largest technology names continued to limit the major averages. The divergence between semiconductor stocks and other areas of the market remains a central theme as investors prepare for the first major wave of Q3 earnings reports.

There was no economic data of note today, and the U.S. Treasury market was closed for Columbus day. 

• Nasdaq Composite: +17.2% YTD
• S&P 500: +14.1% YTD
• Russell 2000: +12.6% YTD
• S&P Mid Cap 400: +10.6% YTD
• DJIA: +7.9% YTD