Week in review: Dell selloff, hot consumer prices, and bond funds

Dell leads an AI-hardware retreat as a downgrade and inflation data weigh

Breadth. 57.2% of the 909 most heavily traded U.S.-listed stocks rose this week.

The S&P 500, day by day

• Mon −0.06%
• Tue −0.02%
• Wed · Worst day −1.11%
• Thu · Best day +0.33%
• Fri −1.09%

Sectors this week

• Consumer staples +5.02%
• Energy +4.86%
• Health care +3.45%
• Materials +3.01%
• Utilities +1.93%
• Financials +1.44%
• Real estate +1.32%
• Communication services −0.05%
• Consumer discretionary −0.35%
• Industrials −0.88%
• Technology −7.70%

Biggest gains

• Bending Spoons S.p.A BSP +23.84%. After Berkshire Hathaway invested more in the company and raised its stake, reports said.

• Accenture ACN +9.86% (+$13.76B in market value). After the company set multi-year growth and buyback targets at its investor day and analysts raised price targets.

Biggest declines

• Rocket Lab RKLB −25.47% (−$11.11B in market value). After the company delayed its Neutron rocket, according to reports.

• CoreWeave CRWV −25.21% (−$11.41B in market value). As credit markets signaled rising worry about the company's debt, though JPMorgan called the fears overblown.

• Index funds may have felt Nvidia's slide more than most, as the chipmaker lost $370 billion in market value while its shares tumbled 6.6%. Because these funds hold it in proportion to its size, a move that large could weigh on returns, and the broad S&P 500 index slid 1.9% for the week.

• Bond funds may have gained ground this week, since the 10-year Treasury yield slid 15 basis points to 5.09% and bond prices move opposite to yields. Funds holding longer-dated bonds could have felt that shift most, and a yield at that level may still offer steady income on newly bought bonds.

• Gold funds may have disappointed holders, as a widely held gold fund fell 0.7% this week and has tumbled 3.6% year to date. Because these funds tend to respond to real interest rates and the dollar, shifts in either could matter more for returns than one week's move.

• Sector funds may have delivered very different weeks, as a consumer staples fund surged 5.0% while a technology fund tumbled 7.7%. Holders tilted toward makers of everyday goods could have been cushioned, while those leaning on tech companies may have felt the sharpest losses.

1. 1

   Tue · AMAT · −6.69% Applied Materials extends losses after Chinese memory chip advance. Applied Materials tumbled 6.7% on Tuesday after Chinese memory maker CXMT reported progress on a denser memory-cell design. The selling began in Seoul and spread to U.S. chip stocks. Applied Materials sells the equipment used to make chips. The shares fell every day of the week and tumbled 19.3% over the week, closing Friday at $409.29. Funds focused on semiconductors could see bigger swings if worries about Chinese competition persist.

2. 2

   — Wed Consumer prices run hotter than forecast, keeping Fed hike bets alive. The Bureau of Labor Statistics said on Wednesday that consumer prices rose faster than economists expected in September. Headline inflation and core inflation, which leaves out volatile food and energy prices, both came in above forecasts. The report kept bets on another Fed rate hike alive. The gold fund (GLD) fell 0.7% over the week. Higher rates for longer could keep borrowing costs elevated.

3. 3

   Wed · BAC · −4.76% Bank of America ends week lower after settlement charge dents profit. Bank of America tumbled 4.8% on Wednesday after its third-quarter revenue and adjusted profit missed analyst estimates. A regulatory settlement charge and weaker investment banking revenue weighed on results, though revenue still grew from a year earlier. The shares rose 0.6% on Thursday but fell 0.9% on Friday, ending the week down 5.7% at $51.23. The miss could put more focus on other large banks' results.

4. 4

   Wed · FAST · +1.11% Fastenal ends week higher despite ongoing margin pressure. Fastenal jumped 1.1% on Wednesday after the industrial supplier's third-quarter profit and sales beat analyst estimates. Results also showed continued pressure on gross margins, the share of sales kept after product costs. The shares tumbled 3.1% on Thursday, then jumped 1.3% on Friday to finish the week up 0.5%. A lower target for signing new vending devices and higher planned capital spending could weigh on future profit.

5. 5

   Thu · TSM · −1.80% Taiwan Semiconductor slides despite strong AI-driven quarterly results. Taiwan Semiconductor Manufacturing reported stronger-than-expected third-quarter results on Thursday, helped by demand for AI, smartphone and high-performance chips. Chief Executive C.C. Wei flagged higher capital spending to expand capacity faster. The shares slid 1.8% after the report. GlobalFoundries fell 0.4% on Thursday and tumbled 3.2% over the week. For broad index funds, the Fed's rate decision on Oct. 28 may matter more than chip earnings.

• Topics: Startups, Regulation

  Anthropic opens talks with New York City comptroller after call for IPO delay

  Comptroller Mark Levine urged the AI company to delay its potential IPO over safety risks and shareholder governance, and the talks could affect the listing's timing.

• Topics: Chips, Markets

  Nvidia chief says new chip orders keep arriving despite tech selloff

  Jensen Huang said demand for AI chips still outpaces supply, a sign big buyers may keep spending even as worries grow over debt-funded data centers.

• Topics: Energy, Deals

  Venture Global signs GE Vernova and Baker Hughes deals to power AI sites

  The agreements cover new generating units for its own off-grid power network, the company said, a sign AI's electricity needs could keep feeding orders for equipment makers.

The Fed's overnight rate travels far. The federal funds rate is the interest rate banks charge one another for overnight loans. The Federal Reserve sets a target range for it at its scheduled meetings. Many other borrowing costs tend to follow that range. In practice, the chain runs like this. Fed officials vote to raise, cut or hold the target range. Banks then adjust what they charge each other overnight. Within weeks, rates on credit cards, savings accounts and many business loans tend to shift the same way. A higher rate can mean better returns on cash savings. It can also mean costlier borrowing for households and companies. Markets often move before the Fed acts. Traders bet on the next decision, and new economic data can shift those bets quickly. Inflation reports carry special weight, because the Fed raises rates to cool prices. That happened on Thursday. September producer prices, a gauge of wholesale inflation, rose faster than economists expected. Reports said that lifted bets on a Fed rate hike at its next meeting. Chip and AI-hardware stocks such as Dell fell. The Dow rose as money moved toward defensive and older-economy companies. The rate tends to matter again whenever fresh inflation or jobs data arrive, and on each Fed decision day. Each release could shift expectations for borrowing costs, and with them the prices of stocks valued most on future growth.

Fed funds rate in the glossary

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The big picture. The S&P 500 slid 1.9% this week but has still gained 11.9% for the year. Technology carried the losses. A fund of tech companies tumbled 7.7% after a downgrade of Dell and hotter inflation data hit AI-hardware names. Beneath the index, the week was broader than it looked. 57.2% of stocks rose, and a consumer staples fund surged 5.0%. The 10-year Treasury yield slid 15 basis points to 5.09%, a lift for bond prices.

Tomorrow: The Week Ahead, on September housing starts and the final October reading of consumer sentiment.