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Stock Market Today, Oct. 26: AI Optimism Lifts Nasdaq as Tech Stocks Rebound

Source The Motley Fool

The S&P 500 (SNPINDEX:^GSPC) gained 0.70% to 7,677, the Nasdaq Composite (NASDAQINDEX:^IXIC) rose 0.82% to 26,169 as AI optimism returned, and the Dow Jones Industrial Average (DJINDICES:^DJI) edged up 0.28% to 52,362, diverging from Friday's energy-driven session as oil prices retreated.

Gold prices rose 0.46% to $4,026.30 as of U.S. market close and the 10-Year Treasury yield rose 0.04% to 5%, with investors favoring Real Estate and Technology stocks while Communication Services shares faced selling pressure.

Today's biggest moves

Surgery Partners (NASDAQ:SGRY) soared 48% on reports of a majority-stake takeover negotiation, while Lumentum (NASDAQ:LITE) jumped 8% following a bullish price target initiation. Conversely, Meta Platforms (NASDAQ:META) fell 2% after filing to raise capital for AI infrastructure, and Petrobras (NYSE:PBR) plunged 14% following election results in Brazil.

What this means for investors

The big driver for Wall Street's tech stock rally on Oct. 26, 2026 was the long-awaited initial public offering (IPO) filing by artificial intelligence giant Anthropic. The company filed its S-1 prospectus to go public on the Nasdaq under the ticker "ANT." Its massive revenue growth figures in the filing calmed investor fears that the artificial intelligence boom was losing steam.

Anthropic's IPO revived enthusiasm for technology stocks, helping the Nasdaq Composite lead the market today despite pressure on more mature communication services providers. Adding to today's market performance was Tesla (NASDAQ:TSLA) stock gaining over 5%. Barclays upgraded shares to an Overweight rating, and raised its price target from $370 to $450 due to potential ties with CEO Elon Musk's other company, SpaceX (NASDAQ:SPCX), growth in Tesla's robotaxi business, and a recovery in its core automotive operations.

Meanwhile, Meta Platforms shares slipped after the company disclosed plans to raise up to $95 billion for AI infrastructure, signaling that the immense capital requirements for industry dominance remain a primary concern for mega-cap investors. Next, investors are looking ahead to this week's earnings from Microsoft (NASDAQ:MSFT) and the upcoming Federal Reserve interest rate decision, which will determine if the current momentum can survive tightening financial conditions.

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Robert Izquierdo has positions in Meta Platforms, Microsoft, Space Exploration Technologies, and Tesla. The Motley Fool has positions in and recommends Lumentum, Meta Platforms, Microsoft, and Tesla. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.

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