Market brief — October 30, 2026

In 30 seconds

• Yesterday, Thursday, October 29, European equities closed higher, while United States technology stocks fell sharply as investors questioned whether massive artificial-intelligence spending will generate sufficient returns.^[1][4]
• The decline was concentrated in growth and semiconductor shares: Alphabet fell about 12.6% after weaker-than-expected results, while Amazon and Intel also dropped in extended trading.^[1][3]
• For savers, the immediate implication is greater volatility in expensive technology shares, while utilities, healthcare and other defensive sectors are showing stronger relative momentum.

The figures from the last session

• CAC 40: 7,970.00, up 1.05%; French equities outperformed United States technology stocks.
• Euro Stoxx 50: 6,207.07, up 0.64%; European large caps remained resilient.
• DAX: 26,039.68, up 1.31%; German equities led the European advance.
• S&P 500: 7,720.39, down 0.30%; broad United States equities weakened.
• Nasdaq: 26,184.72, down 1.38%; technology shares bore the main pressure.

These are closing levels from the last session, Thursday, October 29, not live prices for Friday, October 30.

The subject of the day, explained

The central issue is whether artificial-intelligence investment has moved faster than the profits needed to justify it. Alphabet reported third-quarter revenue of approximately $127.6 billion, up 25% year on year, but its earnings per share missed expectations; its shares fell about 12.3%.^[7] Reports also highlighted heavy spending by Amazon and Intel, increasing concern about cash returns from data-centre investment.^[1][3]

The mechanism is straightforward: when companies spend heavily today for profits expected later, investors become less willing to pay high prices when those future profits look less certain. It resembles financing a large renovation before knowing whether the additional rent will cover the cost. Money also moved toward government bonds and other defensive assets as technology risk increased.^[1][2]

The analysis of the day

The market’s message is mixed rather than uniformly negative. Europe rose strongly in the last session, while the Nasdaq fell 1.38% and the S&P 500 declined 0.30%. That divergence suggests the selling was concentrated in technology and artificial-intelligence beneficiaries, not a broad liquidation of every equity sector.

The scanner supports that reading. Only 54% of tracked shares remain above their 200-day average, and 49% are above their 50-day average. That is a balanced market, not a powerful advance led by most companies. Defensive groups are more visible: utilities, pharmaceuticals and tobacco account for much of the strongest technical activity.

The most probable near-term scenario is continued rotation rather than an immediate collapse: investors may reduce exposure to expensive technology shares while favouring companies with visible cash generation and steadier demand. This scenario would be reinforced if further technology results disappoint and the Nasdaq remains below its last close of 26,184.72. It would be weakened if major technology companies deliver stronger forecasts, capital spending begins to moderate, and the Nasdaq quickly recovers the lost ground.

The contradiction is that economic data remained relatively firm, with third-quarter United States gross domestic product growth reported at 3.4%, while inflation expectations remained relevant for interest rates.^[4] Strong growth can support profits, but it may also delay rate cuts, limiting the benefit for highly valued shares.

The word of the day

Market breadth measures how widely a market’s movement is shared among its constituent shares. For example, a rise in an index supported by 80% of its companies is broader and generally more robust than a rise driven by only a few large firms.

What the scanner sees

• WEC Energy Group (WEC), utilities: an exceptional score of 41, with the price reaching a new high for the past 20 sessions, rising trading activity and a strong directional trend. Its strength confirms the rotation toward defensive cash flows rather than the artificial-intelligence theme.
• RTX (RTX), aerospace and defence: an exceptional score of 41, with a new 20-session high, stronger volume and improving trend indicators. The move suggests demand for industrial and defence exposure remains firm, although no specific current result explains it in the available sources.
• Eli Lilly (LLY), pharmaceuticals: an exceptional score of 40, with a 6.6% gap, a new 20-session high and strong volume. Healthcare leadership also confirms the preference for sectors less dependent on long-duration technology spending.

The scanner identifies technical strength, not a guarantee of future performance. Its sector mix is nevertheless consistent with the day’s broader defensive rotation.

The agenda

• United States inflation data: further evidence on core inflation could influence expectations for the Federal Reserve’s next decisions and bond yields.^[4]
• United States technology earnings: results from large cloud, semiconductor and software companies may determine whether the artificial-intelligence spending concern deepens.^[1][3]
• Corporate capital-spending guidance: forecasts from Amazon, Intel and comparable companies could move the technology sector more than headline revenue growth.^[1][3]
• European equity reaction: European markets may initially absorb the overnight technology sell-off after their stronger previous close.

To watch

• A deeper decline in major technology shares could spread from expensive growth companies to the wider United States market.
• Persistent inflation alongside strong growth could keep interest rates high for longer, reducing support for highly valued equities.

The figure to remember: The Nasdaq fell 1.38% in the last session, showing that artificial-intelligence spending concerns are currently outweighing otherwise resilient economic growth.