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A recent decline in AI-related stocks has pushed the S&P 500 about 6% below its record high, a relatively mild pullback by historical standards. Tech shares fell harder, with the Nasdaq down 11% and chip stocks down 36%, a drop comparable to the 35% chip-sector decline seen during the Covid crash. The tracking data is being updated daily.
Market experts note that U.S. stocks have historically risen in the months following midterm elections, with the S&P 500 gaining an average of 13.7% in the year after midterms since 1980, according to a CNBC analysis. However, some experts are warning that 2026 could break from this historical pattern due to unusually difficult conditions this cycle.
Apollo Global Management chief economist Torsten Slok published a note showing that inflation-adjusted revenue per worker and profit margins are rising only among the Magnificent 7 tech giants—Nvidia, Tesla, Amazon, Microsoft, Alphabet, Apple and Meta. The remaining 493 S&P 500 companies show flat revenue per worker and flat margins, with no measurable productivity boost from generative AI, according to Slok's analysis.
Apollo Global Management's chief economist Torsten Slok reported on October 24 that revenue per worker and profit margins are climbing for the Magnificent Seven tech stocks while staying flat across the other 493 S&P 500 companies. Slok said heavy AI investment has produced no measurable productivity gains outside the tech sector, with many firms now treating AI token spending as a cost rather than a growth driver.
A new Show HN project represents each S&P 500 company as a bubble sized by market capitalization, grouped by sector, with stick figures inside representing employees. The density of figures per bubble shows how much market value exists per worker, letting users compare labor intensity across companies. The tool covers companies with sufficient employee counts and market caps, using the latest annual report figures, and is interactive—users can click for details or zoom into smaller bubbles.
The S&P 500 fell 1.3% on Thursday, extending steeper declines seen earlier in Asian markets, as shares tied to artificial intelligence companies pulled indexes lower worldwide. Oil prices climbed to their highest point since May amid concerns over the conflict involving Iran.
New research based on company filings finds that 83% of S&P 500 companies now disclose AI as a risk, up from 12% in 2023, but fewer than 3% of their directors have AI expertise. A separate survey cited in the research found only 23% of executives described their board as highly fluent in AI, while a quarter rated board AI fluency as low or nonexistent.
CNBC's Jim Cramer said investors should resist pulling out of stocks despite a sharp selloff in which the S&P 500 fell about 1%, the Nasdaq dropped 1.9% and the Dow closed slightly lower. He cited a hotter-than-expected inflation report, swinging Treasury yields, rising oil prices tied to the Iran conflict, and mixed earnings from Morgan Stanley and ASML as evidence of the market's unpredictability.
Jim Cramer noted that the S&P 500 has climbed roughly 118% since bottoming on October 12, 2022, despite Fed rate hikes, a banking crisis, tariffs and the Iran conflict. He cited that a $10,000 investment at the bottom would now be worth about $23,061, with Nvidia and Meta Platforms—both held by his Charitable Trust—delivering far larger gains of 1,875% and 488% respectively.
Major indexes hit fresh records before a sharp tech selloff on Thursday, with the S&P 500 still finishing the week up 1.2% and the Nasdaq up 0.6% after Friday's rebound. Separately, SpaceX reportedly seeks to raise $40 billion to expand its Nvidia-powered AI compute business and announced a deal to acquire a nationwide wireless spectrum portfolio for Starlink.
The Financial Times reported that internal memos OpenAI sent investors in late September projected annualized revenue approaching $50 billion, roughly $20 billion below an earlier $70 billion figure that had previously circulated among investors. OpenAI had not disputed the higher $70 billion estimate before the new figure emerged. News of the revised forecast coincided with a 1.25% drop in the Nasdaq and nearly 3% decline in Nvidia shares on Thursday.
Meta has partnered with Walmart, Stripe, Sierra and other companies to publish what they call a 'personal agent protocol,' an open standard meant to govern how AI agents interact with businesses and consumers. The move comes alongside other items in CNBC's Morning Squawk roundup, including the S&P 500 closing at a record before futures pulled back, and new research tying ICE immigration raids to localized economic slowdowns in cities like Minneapolis.