Wall Street Faces Its Verdict Week as Big Tech Earnings Arrive and Oil Eases

Wall Street opened the week trying to steady itself. US stock futures rose on Monday — Dow futures up about 0.4%, S&P 500 futures up around 0.3% and Nasdaq futures up roughly 0.5% — after all three major indexes fell on Friday. The Dow dropped 652.82 points, or 1.2%, to 52,215.16, the S&P 500 shed 0.5% to 7,623.68 and the Nasdaq Composite slipped 0.2% to 25,955.34. It was the second straight weekly decline for the S&P 500 and Nasdaq, though the Dow still finished the week 0.4% higher. Brent crude eased about 1.8% to around $114.60 on Monday after settling at $116.72 on Friday, while US West Texas Intermediate fell about 2% to near $101.10 after closing Friday at $103.27.

Friday’s damage was broad rather than narrow. Eight of the eleven S&P 500 sectors fell — energy gained 2.6% while consumer staples fell 1.9% — and the VIX fear gauge rose 2.2% to 19.45. Two forces did the damage together: surging oil, driven by Middle East tensions and Houthi attacks on Saudi Arabia, and unease about the vast sums being poured into artificial intelligence. Consumers are not helping either: the University of Michigan’s final October sentiment reading came in at 48, roughly flat on September’s 48.1, while households’ one-year inflation expectations ticked up to 4.7% from 4.6%.

This week turns that unease into a test with numbers attached. Alphabet and Microsoft report after Wednesday’s closing bell, Amazon follows on Thursday, and roughly one-third of S&P 500 companies report overall. The question is no longer whether tech giants are spending on AI, but whether it is turning into revenue fast enough to justify it. The sceptical case got louder over the weekend, when Elon Musk warned that more than 200 so-called neocloud firms, which rent out AI computing capacity, could face severe shakeout and consolidation. Nvidia-backed CoreWeave fell about 3% in premarket trading and has already lost more than a third of its value in the past month, with Nebius and Iren also under pressure — even as Musk said SpaceX had closed $40 billion in debt financing to buy more AI chips. The build-out continues, but investors are asking harder questions about who pays for it.

Early corporate signals were mixed rather than decisive. Verizon raised its full-year adjusted earnings outlook to $5.04–$5.06 per share after third-quarter adjusted earnings of $1.31 beat the $1.27 analysts expected, although revenue of $34.3 billion came in slightly below estimates; it also announced a $2 billion AI infrastructure deal with Amazon Web Services. After Monday’s close, Nvidia partner Cadence Design Systems was expected to report adjusted earnings of $2.05 per share on revenue of $1.62 billion, more than 20% higher than a year earlier — an early read on chip-design demand upstream of the AI boom.

Why this week matters so much is the pile-up. Alongside earnings, the Federal Reserve decides rates on Wednesday and is widely expected to hold steady — traders price about a 90% chance of no change, according to CME FedWatch — even as markets put roughly an 80% chance on a hike in December. The 10-year Treasury yield sits near 5.01%, below this month’s 5.36% peak, and the week also brings a September core inflation reading expected near 3.1% and third-quarter growth forecast at a brisk 3.2% annualised pace. The danger is the sequence: a hot inflation print could reframe the Fed’s message, which could reframe earnings, which could reframe oil. Our free forex course explains how rates and yields move markets, and the forex tools page has calculators for sizing risk before volatile weeks. (Not financial advice.)