First Signal

The companies building AI's data centers bounced on Election Day morning: Bloom Energy rose 11.6%, GE Vernova 6.0% and AMD 4.8% ahead of its report tonight. Apple fell 2.4% on its margin forecast and Palantir 5.0% after its results. The Nasdaq rose 0.7% and the Dow fell 0.5%. Oracle, which priced $10 billion of new bonds on Monday at interest rates of 7% to 8.65%, gained 5.3%. Job openings rose to 7.52 million in September, more than economists expected, and the 10-year Treasury yield climbed to 4.95%. Our read: AI got its bounce and its bill on the same morning. The bounce is one morning old; the bill runs to 2046.

Inside Oracle's $10 billion at up to 8.65% · The AI builders bounce · The midterm streak that survived 1987

Also moving

• Marvell MRVL −0.3%. The chipmaker buying Lumentum for stock was downgraded to neutral by Bank of America, which cut its price target to $225 from $400 on the "potential for extended stock overhang" from the deal, CNBC reported.
• Lumentum LITE +0.5%. The laser maker Marvell is buying was upgraded to strong buy at Raymond James, which called Monday's 18.6% fall overdone, CNBC reported.
• Howmet HWM +4.7%. The maker of jet-engine parts was upgraded to overweight at KeyBanc, which pointed to the stock's fall of about 11% over six months, CNBC reported.

Apple AAPL −2.4%. Revenue rose 12% to $114.5 billion in the quarter, and iPhone sales rose to $57.6 billion from $49.0 billion a year earlier, while iPad sales fell to $6.2 billion from $7.0 billion, Apple's results release shows. Apple forecast a gross margin of 45% to 46% for this quarter, below the 46.3% analysts expected, CNBC reported; analysts at Bernstein and Evercore pointed to the rising cost of memory chips. Apple sat out the AI spending race, and investors paid it for that. Now the AI race is raising the price of the memory in every iPhone, so Apple pays part of the bill anyway.

Palantir PLTR −5.0%. Revenue rose 96% to $2.31 billion, and U.S. commercial revenue rose 148% to $984 million, above U.S. government revenue of $953 million, Palantir's release shows. It raised its full-year revenue forecast to $8.53 billion. Analysts pointed to smaller deals and slower bookings growth outside the U.S., and UBS noted that its backlog was flat from the previous quarter for the first time since early 2023, CNBC reported. Nearly doubling its sales wasn't enough. When a stock is priced for perfection, the one flat number is the one that gets sold.

The midterm streak that survived 1987

A year after every midterm election since 1942, the S&P 500 was higher. Twice it barely made it.

Election week brings out one statistic. In every midterm election since 1942, 21 of them, the S&P 500 was higher a year later than at the last close before the votes were counted, by our books. (Before 1957, that is the smaller S&P index that the S&P 500 replaced.) CNBC's version starts in the early 1980s.

The streak has had close calls. After the 1946 vote the index was up 0.1% a year later. After the 1986 vote, the year included the crash of Oct. 19, 1987, when the index fell 20.5%, its worst day ever, and it still finished 1.1% higher. The last miss was 1938, down 5.1%, and 1930, when the Depression took 36.8%.

Streaks are stories, not laws. Twenty-one is a small number: one was saved by a decimal point, and another by about a point. BTIG's Jonathan Krinsky argues the setup is backward this year: stocks are usually weak going into a midterm vote, and this year they aren't. The S&P 500 already has double-digit gains for 2026, CNBC reported. If the streak holds, it will have done it from a high start.

What would kill it: the S&P 500 on Nov. 3, 2027, below its close today, Election Day.

AI got a bounce and a bill on the same morning, and the bill is the one that lasts.

Last night we said oil gave stocks a gift and they spent it everywhere but AI. This morning they spent a little on AI. One morning doesn't move our odds. Oracle's bonds move one of our signals.

What came in

Start with Oracle, because it is the clearest number we have had on the AI build-out's real cost. A company with $125 billion of debt went back for $10 billion more and paid 7% to 8.65% to get it. The stock rose this morning, which is what stocks do when the cash arrives. The lenders set the price, though, and they priced Oracle closer to a risky borrower than to a blue chip. On the same morning, Blackstone's president said the build-out needs more shareholders' money because lenders are increasingly exposed, and Pimco's CEO warned it could become "too much."

The bounce itself is real but narrow. The chip and power names in our chart rose 2.8% to 11.6%, while the equal-weight S&P 500 slipped: this morning the giants beat the average stock. We don't move our rotation odds on one morning. Tonight's votes and AMD's report are the first real tests, and Friday's jobs report is the bigger one: a strong job-openings number this morning, plus Australia hiking again, keeps a December rate hike on the table.

The signals

Bars are our conviction: the chance it happens by the date shown.

Where the puck goes next: our odds through November

Noise of the day The election-week streak. It makes a great chart and a weak forecast: it says nothing about which way stocks go on Wednesday, and Wednesday is what this week trades on.

What would make us tear this up: a weak jobs report on Friday that takes the December hike off the table while oil goes back above $104. That mix, a slowing economy with expensive energy, fits none of our three. We'll keep score at the end of November.

Tonight AMD reports after the bell, and the votes come in. See you at the close.