The Closing Bell
Wall Street split down the middle Thursday as falling yields lifted housing and rate-sensitive names while a fresh wave of AI capex anxiety hammered the chip complex and dragged the Nasdaq to its worst session in weeks.
Rates and housing carried the day's clearest macro signal.
The 10-year Treasury yield slipped below 5% for the first time since September 23, with jobless claims holding steady at 194,000 and the Leading Index flat. The move sent the iShares 20+ Year Treasury ETF (TLT) up 1.9% and lit a fire under homebuilders after the Treasury Department proposed rules barring large institutional investors from buying single-family homes starting January 2027. D.R. Horton (DHI) jumped 6.2%, Dream Finders Homes (DFH) spiked 12.1%, and American Homes 4 Rent (AMH) added 3.1% as the sector reprices around less institutional competition for starter housing.
The chip trade cracked hard.
Nvidia CEO Jensen Huang's comments flagging scarce capital to fund AI buildouts, paired with a Lam Research warning that supply-chain constraints could push equipment shipments to March, sent semiconductors reeling across the board. The selloff dragged the Nasdaq-tracking QQQ down 2.9% versus a 1.2% slide in the SPY, while small caps in the IWM barely moved, up 0.1%, underscoring how concentrated the damage was in mega-cap tech. Amazon (AMZN) bore the brunt, down 4.6% on the day, part of a broader mega-cap tech pullback even as Apple (AAPL) bucked the trend, up 1.3%. Gold also gave ground, with GLD off 2.6%, as the dollar held roughly flat.
Money rotated out of AI-levered names and into enterprise software.
Better-than-expected Q3 results from SAP and IBM (IBM) pulled buyers into established software franchises, with Salesforce (CRM) up 3.5% and gains across names like ServiceNow, Adobe and Roper. IBM itself closed up a modest 0.4% even as UBS and Citigroup both raised price targets following its upbeat quarter.
On single stocks, CSX (CSX) was the day's standout, surging 7% as analysts lifted price targets after its third-quarter results.
Nike climbed on bullish commentary with Guggenheim reiterating its buy rating. Merck (MRK) slipped 1.8% even after the FDA granted traditional approval for its pembrolizumab combination and a Merck-Moderna Phase 3 trial showed the mRNA cancer therapy cut melanoma recurrence risk by 42%; Moderna shares sank anyway on the news.
After the bell and tomorrow:
A dense slate of earnings hits tonight, including Western Digital (WDC), VeriSign (VRSN), Deckers (DECK), Boston Beer (SAM), RingCentral (RNG) and Blackstone (BX), with reaction likely to set the tone into Friday. Traders will also be watching whether the chip selloff stabilizes or deepens as more AI infrastructure commentary rolls in.
Bottom line: the market is rewarding rate relief and software stability while punishing anything priced for uninterrupted AI capex growth, and that fault line is now the central story for risk assets.