Stocks reached fresh record highs early last week, with the S&P 500 closing above 7,800 for the first time and the Nasdaq also hitting a record on Tuesday. But a sharp selloff in tech stocks on Thursday and only a modest bounce on Friday left the S&P 500 up 1.2% for the week and the Nasdaq up 0.6%, according to a CNBC Investing Club report.
The AI trade was the main source of volatility. A Financial Times report suggested OpenAI's annualized revenue at the end of September was roughly $20 billion below what had been previously indicated, sending AI stocks lower. The next day, Bloomberg reported that OpenAI expects annualized revenue of at least $70 billion by year-end, helping the sector rebound. The episode underscored how quickly sentiment toward AI can shift.
SpaceX also moved markets. Reports said the company was looking to raise $40 billion to buy more Nvidia chips and expand its AI compute business, and it announced a deal to acquire a nationwide spectrum portfolio that could strengthen Starlink's mobile ambitions. Telecom stocks fell on the news, and Goldman Sachs raised its SpaceX price target to $230.
Separately, consumer data from HundredX showed Starbucks was the only chain among a group of competitors to see improving customer intentions to spend more. But a Financial Times report that Starbucks had explored acquiring Chipotle raised questions about a potential deal. The CNBC Investing Club report said it was not convinced a transaction would happen, and suggested a further decline in Starbucks shares could be an attractive buying opportunity if the company does not pursue Chipotle.