Higher-than-expected inflation data pushed the Nasdaq down at the close, with fresh speculation about further Federal Reserve rate action putting pressure on technology stocks — including Oracle and CoreWeave — whose share prices tend to move inversely with borrowing costs. Mounting anticipation that the Federal Reserve would be forced to lift interest rates further in order to tame inflation put pressure on a number of stocks that had recorded the sharpest advances through 2026.
Shares in Oracle retreated 8.8%, while AI-infrastructure providers CoreWeave and Nebius posted steeper losses of 15% and 10% respectively. Dell and Hewlett Packard Enterprise saw their share prices drop 11.4% and 8.2% respectively after Barclays moved both AI server makers from "overweight" to "equal-weight," while the Philadelphia SE Semiconductor Index gave back 4.3% — its sixth straight losing session, a run of that length not recorded since May 2025.
Shares in Apple edged up 0.5%, nudging the company's total valuation past the $5 trillion threshold at the closing bell for the first time on record.
September's consumer price index reading, released by the Bureau of Labor Statistics, pointed to a pickup in inflation as fuel costs climbed and upward pressure on prices spread into categories beyond energy. Derivatives markets tied to interest-rate expectations placed the probability of a Fed rate increase this month at 37%, up from 22% two days prior, per data from CME's FedWatch tool.
The chief executive of 50 Park Investments told reporters that the inflation reading had unsettled market participants by adding pressure on the central bank to tighten policy further, describing elevated prices as the primary concern for both investors and the Fed. The S&P 500 fell 1.11% to close at 7,718.94, its steepest single-session loss since 29 July.
Closing at 26,692.87, the Nasdaq shed 1.88% on the day — a single-session loss not matched since July 23. The Dow Jones Industrial Average settled at 51,621.48 after shedding roughly a tenth of a percent.
Pressure fell across eight of the eleven S&P 500 sector groupings, with the technology-focused index absorbing the steepest drop at 2.6% and communication services posting a 1.78% retreat. Trading across U.S. exchanges ran at 18.0 billion shares, a pace that edged above the 17.6 billion daily average recorded over the prior 20 sessions.
Powered largely by artificial intelligence stocks, the S&P 500 has held onto a roughly 13% year-to-date advance through 2026, a stretch that included the index touching an all-time peak in the days prior. Roughly 4% of value has accrued to the typical S&P 500 constituent through 2026, yet more than 200 of the index's member stocks are sitting on losses for the year.
Shares of Bank of America dropped by 4.8%. Quarterly earnings at the bank declined after it allocated $1.2 billion toward anticipated penalties tied to regulatory findings that anti-money-laundering controls had not functioned as required. Shares in Morgan Stanley slid by nearly 3%, even as the bank posted a quarterly profit increase. The S&P 500 Banks index settled at its weakest closing level since June, edging down 0.7% on the day.
Ahead of the inflation figures being published, Fed Vice Chair for Supervision Michelle Bowman indicated that policymakers had room to monitor how financial markets and broader economic conditions developed following the September rate adjustment before committing to any next steps.
Bending Spoons stock advanced 41% on the back of a fresh $330 million commitment from Berkshire Hathaway — the conglomerate whose portfolio already encompasses Vimeo and AOL — as a portion of the market's trading activity reflected the tendency to read Berkshire's allocation decisions as a broader directional indicator.
Within the S&P 500, roughly 1.1 losing issues existed for every one that posted a gain. On the S&P 500, 15 stocks touched fresh peaks against 11 at new troughs, while across the Nasdaq, 27 names reached their highest points of the period as 521 others fell to new lows.
