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Wall Street reversed higher on Tuesday as earnings and falling oil prices helped offset early AI selling.
Wall Street’s major indexes opened lower on October 20 as AI-linked stocks weakened and oil prices rose. The Dow Jones Industrial Average fell 6.8 points, or 0.01%, to 51,959.21. The S&P 500 fell 0.15% to 7,679.01, and the Nasdaq Composite fell 0.37% to 26,332.92. The declines followed a gain on Monday, when the Nasdaq rose 1.11% after its worst week since June.
The market turned higher soon after the open. The Dow rose 618 points, or 1.2%, while the S&P 500 rose 0.7% and the Nasdaq rose 0.6%, even as swings in AI stocks kept Wall Street unsettled.
Earnings Help Lift the Dow
3M went up more than 4% after it raised its full-year profit forecast and expanded its data center partnership with Amazon. Northrop Grumman and RTX also rose after reporting results.
Not every report was well received. General Motors fell 6.5% before the open after it gave a full-year profit forecast that was below analyst expectations. GM’s quarterly profit still beat estimates, and GE Aerospace fell about 5% even though its profit also topped expectations.
AI Stocks Start Lower, Then Recover
Investors are worried about how AI companies will pay for their spending. Higher interest rates have weighed on technology stocks, especially chipmakers and data center operators.
CoreWeave, which rents AI computing power over the cloud, is the main focus of those worries. The company has about $50 billion in debt, and its shares fell about 25% last week. CoreWeave and Nebius Group each fell 4.9% in premarket trading. In South Korea, the AI company Elice fell nearly 30% in its market debut.
Micron, Intel and SanDisk each fell about 2% in early trading, but all three later turned higher and were up about 1%. CoreWeave also reversed and was up more than 2%.
Oil Rises to Five-Month High, Then Falls
Brent crude futures rose above $111 a barrel early on Tuesday, the highest level since May. The rise in oil prices was one of the factors weighing on stocks at the open.
Traders pointed to claims by the Houthis, an Iran-aligned group in Yemen, that they attacked Saudi energy sites on Monday, including an Aramco facility in Yanbu and the Shaybah oilfield. Saudi authorities had not immediately confirmed the claims. Kpler data also shows that at least 18 vessels were reportedly attacked in the Gulf over the past two weeks.
Oil prices then reversed. Falling crude oil helped drive the stock rebound, and market quotes later in the morning showed Brent near $107 a barrel. That is more than 2% below Monday’s settlement price of $109.55.
What to Watch Next
SpaceX and Netflix report results after the market closes today. Analysts expect SpaceX to report revenue of about $12.7 billion and a profit of 13 cents per share, according to LSEG data. In the second quarter, the company reported $7.8 billion in revenue and a loss. SpaceX will hold a webcast at 4:30 p.m. ET. Meta and Tesla report on Wednesday. The Federal Reserve meets on October 27 and 28, and the CME FedWatch Tool shows about an 82% chance it will keep interest rates unchanged.
