Dow drops 300 points, S&P 500, Nasdaq slide as regional bank woes hit markets
US stocks fell on Thursday as a US-China trade war dragged on, while loan losses at regional banks fueled continued concerns over credit quality.
The tech-heavy Nasdaq Composite (^IXIC) flipped from solid early gains to a 0.5% loss, even as Nvidia (NVDA) and other AI-related stocks floated higher after chip manufacturing giant TSMC’s stellar earnings. The S&P 500 (^GSPC) fell 0.6%, and the Dow Jones Industrial Average (^DJI) decreased 0.6%, or roughly 300 points.
Investors flocked to bonds with the 10-year Treasury yield (^TNX) dropping below 4%. Meanwhile, gold (GC=F) climbed above $4,300 per ounce, another record for the precious metal.
A choppy market action remains the theme of the week on Wall Street, despite hints of coming Fed rate cuts and strong quarterly results from Wall Street banks.
Regional banks, however, were in Thursday’s spotlight, with shares of Zions Bancorporation (ZION) and Western Alliance (WAL) plunging after both disclosing problems with loans, adding to concerns over credit stress.
Chip stocks rose earlier in the session on Thursday after TSMC (TSM) hiked its outlook for 2025 revenue growth for the second time this year, giving hope that surging AI demand will keep on booming.
The go-to contract chipmaker for Nvidia and Apple (AAPL) also reported a nearly 40% surge in quarterly profit in the last quarter, beating estimates and reaching a record. Nvidia, Broadcom (AVGO), Micron (MU), and other AI-related stocks rose.
Meanwhile, US-China trade frictions were again in the spotlight after Trump confirmed on Wednesday that tensions with China remain elevated. He told a reporter who asked whether the two countries are headed for a long-lasting trade war, “Well, you’re in one now.” At the same time, Treasury Secretary Scott Bessent suggested the trade truce between the two could be extended.
Another headwind, the US government shutdown, entered its third week. The stoppage, which has deprived the Fed and Wall Street of key data on the economy, is increasingly expected to continue into November.
LIVE COVERAGE IS OVER 24 updates
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Stocks sink as regional bank losses raise credit quality concerns
The major averages retreated on Thursday as a couple of regional banks warned of loan losses, sparking concerns over credit quality.
The tech-heavy Nasdaq Composite (^IXIC) slid 0.5%, while the S&P 500 (^GSPC) fell more than 0.6%. The Dow Jones Industrial Average (^DJI) dropped about 0.6%, or 300 points.
The major averages flipped into red territory as worries within the Financials (XLF) sector dragged on the rest of the market.
The 10-year Treasury yield (^TNX) dropped below 4%, signaling rising concerns of an economic downturn. Gold (GC=F), meanwhile, climbed above $4,300 per ounce.
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Docusign CEO says OpenAI’s speed of development is forcing companies to move faster
Yahoo Finance’s Francisco Velasquez reports:
Read more here.
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Financials lead losses as regional bank woes spook markets
Financials led the declines on Thursday as concerns over credit quality at a pair of regional banks spooked investors.
Regional bank stocks fell after Zions Bancorporation (ZION) disclosed that it would take a $50 million loss in the third quarter on two separate commercial and industrial loans.
Western Alliance (WAL) shares also plunged after the regional lender said a borrower failed “to provide collateral loans in first position.”
Meanwhile, Jefferies (JEF) stock also moved lower, extending the recent fallout from its involvement in the collapse of First Brands.
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Bitcoin sinks with safe haven bets ‘clearly favoring gold’ after crypto washout
Bitcoin (BTC-USD) has had a rocky first half of October so far.
The world’s largest cryptocurrency surged to start the month as investors sought a hedge against US government shutdown uncertainty. Last Friday, it plunged from $121,000 as low as $104,000 following President Trump’s threat of 100% tariffs on Chinese goods.
Bitcoin’s descent was particularly notable against the backdrop of gold (GC=F), which has climbed to new all-time highs past $4,200 and is up 16% in the past month. Bitcoin, by comparison, has yet to recover from Friday’s losses and is down 8% in that period.
“Right now, capital is clearly favoring gold due to its momentum and reduced volatility profile,” Sean Farrell, head of digital asset strategy at Fundstrat, told Yahoo Finance. “There are also structural buyers in central banks, which provides a quasi-backstop to the trade.”
Read more here.
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Oracle says it expects cloud infrastructure revenue to reach $166 billion, stock jumps
Oracle (ORCL) said on Thursday it expects cloud infrastructure revenue to reach $166 billion by fiscal year 2030.
Shares of the cloud technology provider jumped as much as 5% in afternoon trading following executives’ remarks at an investor presentation on Thursday. Leaders also said that the company’s AI infrastructure unit saw 117% growth in the fiscal first quarter of 2026.
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Mortgage rates moved lower this week but remain stuck in a narrow range
Yahoo Finance’s Claire Boston reports:
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Regional bank stocks tank after Zions charge-off, fraud allegations
Stocks of regional banks were hit Thursday amid growing concern in the private-credit space, which came to the forefront this week after a warning from JPMorgan (JPM) CEO Jamie Dimon.
Also moving these stocks was a disclosure from Zions Bancorporation (ZION) that it would take a $50 million loss in the third quarter on two separate commercial and industrial loans.
Shares of Zions were hit particularly hard. Also plunging were shares of Jefferies (JEF), which has been caught up in the First Brands collapse.
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United stock dives 8% after earnings
United Airlines (UAL) shares fell more than 5% in midday trading on Thursday despite reporting third quarter financial results ahead of expectations the previous day.
Yahoo Finance’s Pras Subramanian wrote of the results:
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Stocks slide, 10-year yield falls below 4%
Stocks were in for another choppy trading day on Thursday as trade war fears overtook bullish views on AI and the major gauges dipped.
The Dow (^DJI) and the S&P 500 (^GSPC) were 0.3% lower in the afternoon, while the Nasdaq Composite (^IXIC) dropped 0.2%.
Following the morning’s optimism over TSMC’s (TSM) quarterly results and what it spells for AI demand, chip stocks remained in the green, though the technology sector broadly (XLK) wavered. The volatility index (^VIX) spiked as high as 24.
Meanwhile, Treasurys fell after two regional banks — Zions (ZION) and Western Alliance (WAL) — disclosed faulty loans and allegations of fraud, prompting concerns about credit stress.
The 10-year yield (^TNX) declined by 7 basis points to 3.97% — its first move below the 4% level since April. The 30-year yield (^TYX) slid to 4.59%.
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OpenAI would have to spend over $1 trillion to deliver its promised computing power. It may not have the cash
OpenAI (OPAI.PVT) would have to spend more than $1 trillion within the next five years to deliver the massive amount of computing power it has promised to deploy through partnerships with chipmakers Nvidia (NVDA), Broadcom (AVGO), and Advanced Micro Devices (AMD), according to Citi (C) analysts.
OpenAI’s latest deals with the three companies include an ambitious promise to deliver 26 gigawatts worth of computing capacity using their chips, which is nearly the amount of power required to provide electricity to the entire state of New York during peak summer demand.
Citi estimates that it takes $50 billion in spending on computing hardware, energy infrastructure, and data center construction to bring one gigawatt of compute capacity online.
Using that assumption, Citi analyst Chris Danely said in a note to clients this week that OpenAI’s capital expenditures would hit $1.3 trillion by 2030.
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ABAT stock sinks as US government cancels grant
American Battery Technology Company (ABAT) shares sank 28% Thursday after disclosing in a filing to the US Securities and Exchange Commission that the US Department of Energy has canceled $52 million in grant funding.
ABAT had been awarded the grant in 2023 to support its $115 million project to build a commercial manufacturing facility for the production of battery-grade lithium hydroxide, which the company said would advance domestic critical mineral lithium production and support US energy independence.
ABAT said in the filing that it has appealed the termination, but added, “Regardless of the outcome of the appeal process, the Company intends to move forward with the project without impact to timeline or scope.”
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Waller calls for October cut and then caution as he competes for Fed chair post
Yahoo Finance’s Jennifer Schonberger reports:
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The stock market isn’t fully pricing in OpenAI’s promises: Analysts
There’s a growing fear on Wall Street of an AI hype-fueled market bubble. The argument is that valuations are stretched as tech stocks become intertwined through a tangled web of circular investments linking them more closely to the success of OpenAI (OPAI.PVT), which has yet to turn a profit.
OpenAI has promised to deliver billions in revenue to cloud providers, chipmakers, and data center companies as it works to bring online more than 26 gigawatts of computing power in the next several years — enough power to provide electricity to more than 20 million homes — that would help train and run its next-generation AI models.
And those promises have helped fuel broader optimism about future demand for AI chips and cloud services.
But Wall Street analysts Vivek Arya of Bank of America and Gil Luria of DA Davidson told Yahoo Finance in interviews that fears of a bubble could be overdone because at least some parts of the market aren’t fully pricing in OpenAI’s success in achieving its goals. In other words, if OpenAI doesn’t do everything it says it will, stocks may not crash as badly as some analysts fear.
DA Davidson’s Luria pointed to Oracle (ORCL) stock as an example. Oracle shares surged as much as 43% and traded as high as $345 when the cloud company revealed a backlog of massive AI contracts during its latest earnings report. However, the stock dropped to as low as $292 in the two days following a Wall Street Journal report that revealed OpenAI was responsible for the vast majority of that backlog.
“So that tells you the market has put about a 50% discount on OpenAI living up [its]obligations to Oracle,” Luria said. “And I think [that is] a rule of thumb that tells you what the perspective is, which is, it’s possible that OpenAI can spend all this money, but there’s a pretty good chance they won’t spend all this money.”
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Why odds are increasing that the government shutdown could last into November
Yahoo Finance’s Ben Werschkul reports:
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Stocks climb at the open
US stocks rose on Thursday as the world’s leading AI chip manufacturer TSMC (TSM) posted earnings results ahead of expectations that lifted AI market optimism.
The tech-heavy Nasdaq Composite (^IXIC) moved up nearly 0.5%, while the S&P 500 (^GSPC) put on roughly 0.3%. The Dow Jones Industrial Average (^DJI), which includes fewer tech stocks, added 0.25%.
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Nvidia, chip stocks climb as TSMC lifts forecast, chair C.C. Wei notes ‘conviction in the AI megatrend’
Nvidia (NVDA), Broadcom (AVGO), and other chip stocks rose as TSMC’s (TSM) earnings and executive commentary bolstered confidence in AI-linked semiconductor demand.
Shares of leading AI chipmaker Nvidia rose 1%, while rival Broadcom added 1.4%. Shares of Micron (MU), whose memory chips are used alongside Nvidia’s GPUs in AI servers, climbed 3.4%, while British chip designer Arm (ARM) gained nearly 1%. AMD (AMD) shares were flat.
The moves come as TSMC’s third quarter earnings report surpassed expectations and the Taiwan-based contract chip manufacturer lifted its full-year 2025 revenue growth outlook to the mid-30% range from its earlier 30% forecast.
TSMC also lifted the bottom of its capital expenditure forecast range to $40 billion from $38 billion — with 70% of that budget allocated to ramping up its advanced manufacturing processes related to AI chipmaking — as the company noted “higher growth opportunities in the following years.”
TSMC chair C.C. Wei said: “Our conviction in the AI megatrend is strengthening and we believe the demand for semiconductor[s] will continue to be very fundamental.”
CFO Jen-Chau Huang added that “next year looks to be a healthy year, and we are confident on the mega trend that we’ll continue to invest.”
That conviction is a positive signal for the AI space, as CEOs and Wall Street analysts increasingly express concerns over a market bubble fueled by AI hype and a tangled web of circular investments among the leading industry players.
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Hims & Hers stock dips after rallying on new menopause treatments
Hims & Hers (HIMS) stock dipped on Thursday morning after mounting a huge 16% rally on Wednesday.
The telehealth provider said it would now be providing a line of treatments for menopause and perimenopause, expanding its range of hormone replacement therapies, as it looks to scale in that market.
The company stated that around 1.3 million women in the US experience menopause each year, but less than a third of OB/GYN residencies offer menopause training. The US hormone therapy market was last estimated at around $11 billion in 2024 and is forecast to grow to $19.22 billion by 2033, according to Grand View Research.
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OpenAI has 2 kinds of dealmaking — and they’re lopsided
Yahoo Finance’s Hamza Shaban reports:
Read more here in the takeaway from today’s Morning Brief.
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Good morning. Here’s what’s happening today.
Please note: Some economic data will not be available due to the government shutdown.
Economic data: Initial jobless claims (week ending Oct. 11); Continuing claims (week ending Oct. 4); Retail sales advance (September); Producer price index final demand (September); Philadelphia Fed business outlook; Business inventories (August); NAHB housing market index (October)
Earnings calendar: Taiwan Semiconductor Manufacturing Company (TSM), Charles Schwab (SCHW), BNY Mellon (BK), U.S. Bancorp (USB), Interactive Brokers (IBKR), Marsh & McLennan (MMC), Infosys (INFY), CSX (CSX)
Here are some of the biggest stories you may have missed overnight and early this morning:
Trump on US-China trade war: ‘You’re in one now’
OpenAI has 2 kinds of dealmaking — and they’re lopsided
Xi’s rare earth shock gives Trump a chance to woo back US allies
TSMC hikes outlook in vote for sustained AI boom
Salesforce jumps as $60B forecast eases revenue growth concerns
Gold climbs to record on US-China tensions and Fed rate-cut bets
Oil rises as Trump says India will stop buying from Russia
Nestlé stock soars on sales rebound, plan for 16,000 job cuts
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Premarket trending tickers: Nvidia, HPE and J.B. Hunt Transport
Here’s a look at some of the top stocks trending in premarket trading:
Nvidia (NVDA) stock rose 1% in premarket trading on Thursday after an upbeat earnings release from fellow chipmaker TSMC (TSM) helped boost chip stocks.
HPE (HPE) stock fell 8% before the bell after 2026 guidance came in below expectations amid slow growth for the company’s networking business.
J.B. Hunt Transport Services, Inc. (JBHT) stock rose 13% in premarket trading on Thursday following the release of its third-quarter earnings. The transport and logistics company beat Wall Street estimates.
