Chips Crater, SpaceX Soars: The AI Trade Splits in Two as the S&P 500 Slips From Its Record

October 21, 2026 · 68 sources

Quick Hits

Rough patch after the record. The S&P 500 has slid nearly 2% from its Oct. 6 record close of 7,818.93 — still up about 12% YTD — after the Nasdaq Composite's ~4.5% weekly drop (its worst since June) and an 11%+ plunge in the Philadelphia Semiconductor Index, the worst chip stretch in over a year, as a hot inflation print raised the cost of funding data-center buildouts.
SpaceX is the AI trade's split personality. The stock is surging on computing-power demand that MarketWatch calls "off the charts," lifting the broader AI universe — even as the Motley Fool predicts up to $180 billion in insider sales will hit the tape following June's record $85.7 billion IPO.
Fink warns twice. BlackRock's CEO says opposition to data centers will drive up inflation, and separately flags a midterm-election issue he believes could lead to a recession.
Q3 scoreboard skews mixed. CME Group posted record revenue of $1.74B (beat); Moody's missed on both lines; AT&T's fiber business delivered a large haul of new internet subscribers; Healthcare Services Group beat by $0.13 and raised its 2027 growth outlook.
AI trade cracks abroad. A South Korean IPO flopped — the latest in a string of disappointments for the global AI trade — even as Taiwan Semiconductor upgraded its forecast on soaring AI demand.

The long-run record remains formidable — the Vanguard S&P 500 ETF (VOO) has annualized ~15.3% over the past decade — but the Motley Fool argues the market is doing something for only the second time in 155 years, and that history is "clear" about what comes next.
MarketWatch, citing the Value Line Median Appreciation Potential's solid forecasting record, says smaller stocks face worse prospects than the S&P 500 over the next four years — a bearish read for the small-cap cohort.
Midterm math offers a bull counterweight: the S&P 500 was higher one year after all 19 midterm elections since 1950, per the Motley Fool. This year's vote falls on Nov. 3.
Positioning reads: Cathie Wood's Ark grew its portfolio to $15.4 billion last quarter, with Tesla (TSLA), AMD, and a new SpaceX (SPCX) stake making up ~18% of ARKK assets — a concentrated bet under scrutiny. Meanwhile, Warren Buffett's successor Greg Abel went shopping in tech again at Berkshire Hathaway (BRK.B).

AT&T (T): Fiber was the star of Wednesday's report, powering a large haul of new internet subscribers and letting the carrier shrug off SpaceX fears.
Moody's (MCO): Non-GAAP EPS of $4.14 missed by $0.11; revenue of $2.02B missed by $60M.
CME Group (CME): Q3 revenue hit a record $1.74B, beating estimates.
Stifel Financial (SF): EPS of $1.46 edged past by a penny; revenue of $1.43B missed by $20M.
Winnebago (WGO): EPS of $0.49 beat by $0.02; revenue of $645.1M missed by $15.15M.
Old National Bancorp (ONB): EPS of $0.66 in line; revenue of $712.73M missed by $19.28M.
Healthcare Services Group (HCSG): Q3 EPS beat by $0.13 and management raised its 2027 growth outlook.
Washington Trust (WASH): Rising net interest income, expanding margins, and improved credit quality were the takeaways from its Oct. 20 call. Neptune (NP) also reported.

No FOMC decision today, but inflation dominated the macro chatter: the Fool notes "Trumpflation is evolving" with a new twist that threatens stocks, while Trump's latest warning is "sending shockwaves through Wall Street" — coverage worth reading as political risk, not settled economics.
Larry Fink argues that blocking data centers is itself inflationary — a notable frame as AI infrastructure becomes a midterm campaign issue he thinks could tip the economy into recession.
Rate-sensitive names: the Fool highlights two bank stocks expecting faster interest-income growth in 2027, a signal some see as leaning against the rate-cut narrative.
On the household ledger: Social Security's 2027 COLA is being sized up against history, and a MarketWatch columnist weighs whether paying off a $300,000 mortgage at 2.75% ahead of retirement is discipline or madness. Separately, a Bank of Italy study sent 200 USDC across ten remittance corridors and found blockchain was the cheapest rail.

Semiconductors: Last week was the worst for chips in over a year (SOX -11%+), but the demand signal is intact — Taiwan Semiconductor (TSM) management is upgrading its forecast amid soaring AI demand, and the Fool is out with a single AI semi pick to own before 2027.
AI infrastructure is bifurcating: cash-generative compute (SpaceX) is being rewarded, while capital-hungry data-center vehicles struggle to list — see below.
Consumer staples-adjacent: Monster Beverage (MNST) is gaining share in a booming energy-drink category.

The global AI trade's financing window is narrowing: a South Korean IPO flopped, and October alone has seen three data-center flotations shelved — including efforts backed by Nvidia, Blackstone, and SoftBank. Investors, per MarketWatch, are not convinced of the model.
The bear case on SpaceX retail enthusiasm: the Fool predicts up to $180 billion in insider sales set to hit the tape, four months after the June 12 IPO raised $85.7 billion and rewrote record books.
Nuclear fade watch: analysis circulating on r/investing pegs Oklo's (OKLO) market value beyond cash down 91% in a year — roughly $2B for the business at a $5B cap with ~$3B in cash, versus the $171.56 peak in October 2025.
The income basket is getting attention: Enbridge (ENB) has raised its dividend 31 straight years; Enterprise Products (EPD) yields 6.1%; UPS (UPS) yields 6.7% after firing Amazon, with its 2027 dividend survival openly questioned; and BNSF paid Berkshire $4.4B in dividends last year against a $34.5B purchase price in 2010.
Elsewhere: a tech stock down 54% is pitched as a buy with or without AI, and the Fool debates Advance Auto Parts (AAP) versus Coupang (CPNG) as the better 2026 buy.

The theme of the day is divergence. SpaceX's compute demand and TSM's raised forecast say AI demand is real; shelved data-center IPOs and an 11% chip-index drawdown say the financing behind it is getting repriced. The swing factor both stories share: inflation and the cost of capital.
Watch this week: further Q3 prints, any follow-through on the chip selloff, and midterm positioning ahead of Nov. 3 — a date with a historically bullish one-year tailwind behind it.
The retail tell: crash-preparation content (Buffett's "smartest move," recovery-timeline math, compounding pep talks) is crowding feeds — usually a decent sentiment gauge. Nerves are showing, even with the S&P still up ~12% on the year.