Chip rebound ends three-day losing streak; AMD surges after hours

Chip rebound ends three-day losing streak; AMD surges after hours
U.S. Stocks Morning Brief | Wednesday, 4 November 2026 (Hong Kong time; spot-market close refers to Tuesday, 3 November, U.S. Eastern time; regular U.S. stock trading runs from 22:30 to 05:00 the following day, Hong Kong time)

On Tuesday, the Dow fell 0.40% to 51782.29 points, the S&P 500 rose 0.35% to 7568.05 points, the Nasdaq rose 0.83% to 25365.67 points, and the equal-weight S&P ETF (RSP) closed down 0.33% at 219.26 dollars (Reuters (republished)) (Finnhub). The 10-year U.S. Treasury yield was around 4.95%, up about 7 basis points from the previous day; WTI crude was around 96.82 dollars per barrel; gold was around 3934 dollars per ounce, still below 4000 dollars; and the dollar was broadly flat, with the dollar index around 101.8 (Reuters).

Market theme
On election day, the market made a very narrow trade: moving money out of Apple, a “safe tech stock,” and back into chip stocks that had fallen for three days. The Nasdaq and S&P consequently ended their three-day losing streaks, while the Dow alone closed lower because of Apple's weighting. Reuters noted that only 4 S&P 500 sectors rose and 7 fell, with technology up 1.3% and the Philadelphia Semiconductor Index up 2.6%, while Apple's gross-margin warning made the Dow the only major index to close lower (Reuters). After the close, better-than-expected results from AMD, Super Micro Computer and Arista turned the idea that “AI demand is still there” from speculation behind the intraday rebound into after-hours evidence. But what can truly determine whether this correction has bottomed is not the after-hours gains, but the midterm election results, ADP employment data and Treasury refinancing plan due to emerge on Wednesday evening Hong Kong time.

I. Markets and data: chips lead gains, the Dow falls alone, and stronger-than-expected data lift yields

• The rebound was narrow, with chip supply-chain stocks accounting for nearly all the leaders. Reuters reported that the Philadelphia Semiconductor Index rose 2.6% and the technology sector gained 1.3%; Microsoft, Nvidia and Amazon were the three biggest gainers among Dow components, while Walmart and Home Depot were among the biggest decliners (Reuters). Reuters also noted that the Nasdaq 100 had closed on Monday more than 10% below its 6 October record high, confirming a technical correction, while the S&P 500 was about 3% below its 6 October record but still up more than 10% for the year (Reuters (republished)). With 7 sectors down and only 4 up, this was not a broad recovery: investors were picking a small group within the correction—those that had fallen hardest and whose earnings best demonstrated demand. The rebound is real, but the bottom is not yet firm.
• Stronger-than-expected labor data directly pushed yields higher. Reuters reported that U.S. JOLTS job openings in September rose by 333 thousand to 7.523 million, above the market forecast of 7.1 million; the job openings rate rose from 4.3% to 4.5%, while layoffs fell by 127 thousand to 1.641 million (Reuters). Reuters also reported that factory orders in September rose 1.8% month on month, above the expected 1.2%, with civilian aircraft orders surging 28.3% (Reuters). As soon as the data came in hot, the bond market priced in a later start to rate cuts. This was the fundamental divergence behind Tuesday's tech-stock rebound and bond-market decline: equities were trading on AI demand, while bonds were trading on an economy that had not yet cooled.
• The election was the evening's backdrop, not the determining factor at the close. Reuters reported that polls and nonpartisan analysis favored Democrats regaining the House, while control of the Senate remained uncertain; markets would assess the election's implications for fiscal policy, regulation, taxes and government spending (Reuters (republished)). Reuters also reported that options markets implied a move of only about 0.8% for the S&P 500 on Wednesday, slightly above the daily average of 0.6% over the prior month, indicating traders were not betting on a huge swing from the election result (Reuters). Results will begin to become clear no earlier than Wednesday daytime in Hong Kong. Until then, markets can only price uncertainty itself rather than a victory or defeat for a particular party.
• Overseas markets were cautious too. Reuters reported that European stocks fell 0.6% on Tuesday, British stocks fell 1.1%, and South Korean stocks fell 3.6% (Reuters). Reuters' premarket report on Europe said pan-European STOXX 600 futures had fallen more than 1% at one point, against a backdrop of higher oil prices following news of a U.S. strike on Iran's Qeshm Island (Reuters). The declines in Europe and Asia show that Tuesday's caution was not confined to the United States: geopolitical news and an AI sell-off were occurring around the world at the same time, although the intraday rebound in U.S. chip stocks pulled the indexes back up.

II. Bonds, the dollar and commodities: yields rise, oil falls again, and gold remains below 4000 dollars

• Falling bond prices and rising yields were Tuesday's clearest macro signal. Reuters reported that long-term U.S. yields rose by as much as about 7 basis points and the yield curve steepened (Reuters). After both JOLTS and factory orders beat expectations, the bond market left little room for a rapid weakening in employment. Wednesday's Treasury refinancing plan will determine whether this rise in yields is a one-off, data-driven adjustment or the start of supply pressure.
• Oil prices continued to retreat as the geopolitical premium unwound. Reuters reported that oil fell about 1% to a nearly four-week low as markets weighed the prospects for U.S.-Iran talks against fresh supply-disruption concerns, while Iran and the United States remained far from an agreement to end the war (Reuters). Oil plunged more than 7% on Monday and fell another roughly 1% on Tuesday. Taken together, the two days suggest the market is betting that a window for talks remains open rather than that the war premium will immediately return in full. But news of the strike has not disappeared, and oil-price volatility will only be higher than usual.
• Neither gold nor the dollar saw a safe-haven rally. Reuters reported that gold fell about 0.5% and remained below 4000 dollars per ounce, while the dollar was broadly flat (Reuters). The combination of falling gold and a steady dollar suggests there was no genuine rush into safe havens on Tuesday: money rotated within equities rather than fleeing stocks for gold and the dollar.

III. Stock and sector moves, including earnings: Apple weighs on the Dow as three reports follow after hours

• Apple was the main reason the Dow alone fell. Reuters reported that Apple warned rising memory-chip costs would continue to squeeze holiday-quarter gross margins; its shares closed down nearly 2% after falling about 4.5% at one point before the open (Reuters (republished)) (Reuters). Apple faces a different test from its peers: it does not need to prove that “AI spending is worthwhile,” only that it can defend next quarter's gross margin—and rising memory-chip costs are precisely the hardest part of that task.
• Palantir also beat expectations but fell. Reuters reported that after a better-than-expected third quarter, Palantir forecast revenue for the final three months of the year above expectations, yet its shares closed lower. The Wall Street Journal's after-hours roundup put the decline at 1.6%, reflecting investor concerns about the sustainability of its growth (Reuters (republished)) (The Wall Street Journal). What Apple and Palantir have in common is that their valuations had already priced in the good news. When results are merely “good” rather than “far above expectations,” selling becomes the default response.
• AMD led the after-hours reports with a substantial beat. Barron's reported that AMD's adjusted third-quarter earnings per share were 2.09 dollars, above the expected 1.95 dollars; revenue rose 45% year on year to 13.4 billion dollars, above the expected 13.1 billion dollars; and fourth-quarter revenue guidance of 17 billion dollars was well above the expected 16.3 billion dollars. Its shares rose 7.6% after hours to 520.50 dollars (Barron's). The Wall Street Journal reported that AMD's data-center chip sales nearly doubled year on year to 8.5 billion dollars, with their share of total revenue rising from 47% a year earlier to 64% (The Wall Street Journal). The key to AMD's quarter was not how much revenue beat forecasts, but that data centers accounted for more than sixty percent of its business for the first time—turning it from a chip stock into a data-center stock.
• Super Micro Computer and Arista followed, with strong after-hours performance across the AI infrastructure chain. Barron's reported that Super Micro's adjusted fiscal first-quarter earnings per share were 1.81 dollars, above the expected 1.23 dollars, and revenue was 19.95 billion dollars, above the expected 17.53 billion dollars. Its shares rose 8.3% after hours, and its second-quarter guidance also exceeded expectations (Barron's). Barron's reported that Arista's third-quarter revenue rose 58.5% year on year to 3.66 billion dollars, its fastest growth since going public in 2014; adjusted earnings per share were 1.20 dollars, above the expected 1.08 dollars; and fourth-quarter revenue guidance was 3.9 billion to 4 billion dollars. Its shares rose more than 9% after hours (Barron's). Together, the three reports tell the same story: AI infrastructure orders are still coming in and accelerating. That is what gave chip stocks the confidence to rebound during the session and continue rising after hours.
• After-hours trading was also mixed, with cautious guidance in travel and healthcare. The Wall Street Journal's roundup reported that Booking Holdings' profit and sales fell as persistent geopolitical tensions weighed on global travel demand, and its shares dropped about 1.7% after hours. Amgen raised its full-year outlook after third-quarter profit and sales rose, but generic drugs eroded revenue from some products, and its shares fell 1.8% after hours (The Wall Street Journal). AI supply-chain stocks rose while travel and healthcare fell, showing that Tuesday evening's divide was not “tech versus non-tech,” but companies with AI orders versus those weighed down by geopolitics and costs. Guidance remains a more important variable than the results themselves.

IV. AI highlights: the correction is a fact, and AMD's results give the rebound a reason

• The backdrop to the correction has not changed; the rebound simply came first. Reuters reported that the Nasdaq 100 had entered a technical correction amid investor concerns that big technology companies' huge investments in AI infrastructure exceeded their near-term cash returns (Reuters (republished)). Reuters also quoted Morgan Stanley analysts as saying the election should help remove a major market uncertainty and that the correction that began in June had entered its “final stages” (Reuters (republished)). “Final stages” does not mean a bottom has been reached. It suggests only that the correction may be closer to its end in time than in magnitude, and results such as AMD's are a test of that assessment.
• The direction of rotation was clear. Reuters quoted Infrastructure Capital Management CEO Jay Hatfield as describing Tuesday as a rotation “from safe tech stocks like Apple into riskier tech stocks like chips,” and as “buy-the-dip buying in a Nasdaq-driven risk-on market” (Reuters (republished)). Barron's reported that AMD CEO Lisa Su said on the earnings call that the company expected revenue growth of 80% or more in 2027, but did not provide a full 2027 outlook (Barron's). The rotation from “safe tech” to “risky tech” is itself a sign of recovering risk appetite. But it also means that if the next AI earnings report disappoints, the pullback will be faster than in the previous round.

V. Calendar ahead (Hong Kong time)

• 4 November (Wednesday), 21:15: U.S. ADP employment report for October; 21:30: U.S. Treasury announces its quarterly refinancing plan and the U.S. trade balance for September is released; 23:00: U.S. ISM services PMI for October; before the open: McDonald's and Uber report earnings; after the close (early 5 November, Hong Kong time): Qualcomm and Arm report earnings (Reuters).
• 5 November (Thursday): Airbnb reports earnings.
• 6 November (Friday), 21:30: U.S. nonfarm payrolls report for October (Bureau of Labor Statistics), the week's key economic release; Moderna reports earnings.
• Note: The United States has switched to standard time; regular U.S. stock trading runs from 22:30 to 05:00 the following day in Hong Kong time. Midterm election results will gradually become clear during Wednesday daytime in Hong Kong; control of Congress had not been finally determined when this brief was published.