The final trading week of October began with a strong rebound in AI-related stocks, setting the stage for a busy week of earnings and key economic events. The Nasdaq and S&P 500 led gains on Monday, while the Dow lagged slightly. Technology, consumer discretionary, and industrials sectors performed well, while communication services lagged. Investors rotated out of defensive sectors like staples and healthcare, which had reached 52-week highs.
Anthropic, the developer of the Claude AI chatbot, filed for a U.S. initial public offering (IPO) under the ticker 'ANT.' The company reported $16.3 billion in revenue for the first half of 2026, up from $4.6 billion for all of 2025. Anthropic also disclosed $9 billion in AI infrastructure spending for the first half of 2026, compared to $7.3 billion for all of 2025. The company reported a net loss of $80.7 billion, largely due to accounting charges, and plans to spend up to $120.5 billion with SpaceX's AI unit through 2029. Some investors value Anthropic near $1.5 trillion, down from roughly $2 trillion a week earlier.
Meta announced plans to raise approximately $95 billion in equity to fund AI infrastructure, following a quarter where capital spending exceeded operating cash flow. Tesla CEO Elon Musk warned that debt markets have effectively cut off funding for AI data center operators without independent revenue, causing volatile trading among neocloud and data center stocks. These developments highlight the tightening terms for AI financing and the market's focus on companies' ability to fund themselves.
The Federal Open Market Committee begins its two-day meeting on Tuesday, with a decision expected on Wednesday. While a hold is widely expected, traders are pricing in a roughly 90% chance of a hawkish pause under Chairman Warsh. Key economic data, including third-quarter GDP and the core PCE inflation reading, will be released later in the week. The core PCE is particularly significant as it is the Federal Reserve's preferred inflation gauge.
Big Tech earnings will dominate the week, with Microsoft and Alphabet both reporting results on Wednesday after the close. Microsoft is expected to report revenue of $90.58 billion, up 16.6% year over year, and earnings of $4.71 per share, up roughly 14%. Azure's growth and demand will be key focus areas. Alphabet is expected to report earnings of $2.94 per share, implying 2.44% growth, on revenue of $111.8 billion, a 27.8% increase. Despite positive momentum, Alphabet shares have struggled in 2026 with a gain of just 1.4%.