More drops for AI and tech stocks overshadow gains for most of Wall
Street
[November 03, 2026] By
STAN CHOE
NEW YORK (AP) — A morning rally for U.S. stocks petered out on Monday as
the tech and AI industries remained shaky following their sell-off last
week.
The S&P 500 sank 0.5% after erasing a gain that had reached 1.1% early
in the day. The Dow Jones Industrial Average rose 213 points, or 0.4%,
while the Nasdaq composite fell 1.1%.
The mixed performance for indexes came even though the majority of
stocks within the S&P 500 climbed. They benefited from a 7.6% drop for
the price of a barrel of Brent crude to $104.77. It’s the latest yo-yo
move for oil prices on uncertainty about when the war with Iran will
allow the global industry to return to normal.
The price for the most actively traded contract in the Brent market has
been veering between roughly $70 and $120 per barrel since just before
the war with Iran began, and it’s been quick to reverse direction.
So have stocks in the artificial-intelligence industry, which have been
shaky for months amid criticism that they surged too high and are in a
bubble. Worries are growing that all the hundreds of billions of dollars
Big Tech companies are pouring into AI data centers won’t yield enough
productivity and profit to make the investments worth it.
The latest profit reports from Alphabet and other Big Tech companies
also showed how AI may be dragging on their own businesses. Not only did
Google’s parent company burn through more cash during the latest
quarter, as measured by something called free cash flow, it also
reported slower-than-expected growth in its search business, which
raised worries about AI undercutting its cash cow. That caused
Alphabet’s stock to drop more than 12% Thursday for its worst day on
record.
On Monday, Alphabet initially rallied 2.6%, but it later erased the gain
and then finished with a loss of 0.3%. Nvidia, meanwhile, went from an
early gain of 2.6% to a drop of 1.3% following its 4.2% slide on Friday.
Such swings dragged the rest of the market with them.
Adding to the weakness in tech was Marvell Technology, which fell 12.7%
after saying it would buy Lumentum. Marvell said it will give 4.5 of its
shares for each share of Lumentum, which sells lasers and other products
that power the networks and infrastructure behind AI and cloud
computing. Lumentum’s shares fell 18.6%.
Outside of AI and tech, the U.S. market did much better, and nearly
seven out of every 10 stocks in the S&P 500 index rose.
Monday’s ease in oil prices helped lift stocks of companies with big
fuel bills. United Airlines flew 4.8% higher, Southwest Airlines climbed
3.6% and cruise operator Carnival rose 4.2%.
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Trader Joseph Stevens, left, works on the floor of the New York
Stock Exchange, on May 5, 2026. (AP Photo/Richard Drew)
 Marriott International rose 4.3%
after reporting strength for its hotels around the world. Even in
the Middle East, where the war has affected its business, CEO
Anthony Capuano said that “trends improved meaningfully” from the
spring.
Idexx Laboratories leaped 21.8% after it likewise reported stronger
profit and revenue for the latest quarter than analysts expected.
The company, which sells diagnostic equipment and other products to
veterinarians, also raised its forecasts for revenue and profit for
the full year of 2026.
All told, the S&P 500 slipped 38.67 points to 7,541.40. The Dow
Jones Industrial Average rose 213.67 to 51,983.98, and the Nasdaq
composite fell 272.68 to 25,164.32.
Expectations are high for all kinds of companies to continue to
deliver big gains in profits as the U.S. economy keeps chugging
along, even with high inflation and interest rates. That's what
helped send the S&P 500 to its record last month.
A report on Monday said that growth for U.S. manufacturing was
better last month than economists expected. Perhaps just as
importantly, a measure of inflation in the survey by the Institute
for Supply Management showed prices were rising at a slower pace.
In stock markets abroad, indexes rose in Europe.
The swings were larger in Asia, where South Korea’s Kospi jumped
2.2% on renewed strength for the tech giants that dominate its
market.
In China, indexes rose 1.1% in Shanghai and 0.4% in Hong Kong to
recover some of their steep recent losses. Stocks in Shanghai
finished October more than 15% below a peak reached in May.
The People’s Bank of China said Monday that around 100 billion yuan
($15 billion) would be deployed under a new program that could help
support the market. ___
AP Business Writers Chan Ho-him and Michelle Chapman contributed to
this report.
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