October 17, 2026 | US Stocks: A night where the rebound didn't last. Semiconductor and software weakness, and the strength of energy

The three major US stock indices fell. The NASDAQ dropped 2.1%, highlighting the weakness in tech stocks.
NVIDIA, which was in positive territory at 11:55 PM, lost momentum afterward. The decline also spread to software.
In the Tokyo market at the start of the week, we will check for a bottoming out in semiconductors and the spread of gains to resources and daily necessities.

The data covers the October 16 US market trading session. All times in the text are in Japan Standard Time, and individual stock performance is compared to the previous day. Since today is Saturday, we will organize the outlook for the Tokyo market for the start of the week.

1. What happened in the US market—from an early rebound to tech weakness

The closing prices of the major US indices were as follows.

Index Closing Price Change from Previous Day NY Dow 52,002.41 -175.28, approx. -0.3% S&P 500 7,659.44 -84.62, approx. -1.1% NASDAQ Composite 26,140.03 -572.99, approx. -2.1%

For the week, the NASDAQ fell 4.5%, while the NY Dow rose 0.7%. It was a week where fortunes diverged depending on the index.

What I want to focus on this time is not that prices kept falling throughout the night, but that even stocks that rebounded once could not maintain that strength.

11:55 PM—NVIDIA was positive, but the surroundings were weak

At 11:55 PM on October 16, NVIDIA was +0.49% and Apple was +0.76%.

However, Broadcom was -1.55%, AMD was -2.27%, and Micron was -2.79%. It is difficult to say that the semiconductor sector as a whole recovered just because of NVIDIA’s rise.

In software, Microsoft was -0.73%, Oracle was -1.93%, and Palantir was -2.48%. Behind the rebound of some large-cap stocks, weakness remained.

12:35 AM—Software decline deepens

At 12:35 AM on October 17, after the date changed, NVIDIA turned to -0.37%, and Broadcom and AMD expanded their declines to -2.50% and -3.68%, respectively.

At the same time, Microsoft was -1.40%, Oracle was -3.44%, and Palantir was -5.75%.

In cybersecurity-related stocks, Palo Alto Networks was -6.40% and CrowdStrike was -6.93%.

It is important that during this time, the decline had spread not only to semiconductors but also to software.

2:35 AM—Weakness spreads to large-cap tech

At 2:35 AM, Microsoft was -2.71%, Alphabet was -2.28%, Meta was -3.78%, and Amazon was -1.84%.

In semiconductors, AMD was -4.88% and Micron was -4.43%. The early rebound could not be translated into a recovery for the market as a whole.

Meanwhile, at this point, ExxonMobil was up 1.66% and Chevron was up 2.10%. Even as the decline in high-tech deepened, energy stocks were rising.

5:00 AM—Trading ends with semiconductor weakness remaining

As of 5:00 AM, NVIDIA was down 1.43%, Broadcom was down 4.32%, AMD was down 5.91%, and Micron was down 5.67%.

Compared to 11:55 PM, AMD went from -2.27% to -5.91%, and Micron went from -2.79% to -5.67%. It is clear that the decline widened toward the end of the session.

Looking only at NVIDIA’s decline rate, it was a day that made the severity of the semiconductor sector as a whole seem smaller than it was.

2. Strong sectors and weak sectors

In the price movements as of 5:00 AM, the strengths and weaknesses were clearly divided.

The sectors that remained strong were energy and consumer staples.

ExxonMobil was up 2.24% and Chevron was up 2.45%. In consumer staples, Coca-Cola was up 1.64%, P&G was up 1.40%, and Philip Morris was up 2.71%.

In retail, Walmart was up 0.68% and Costco was up 1.08%. Stocks rising in the utilities sector were also spreading.

The sectors that were weak were semiconductors and manufacturing equipment, as well as software and internet-related stocks.

In semiconductor manufacturing equipment, Lam Research was down 4.94% and Applied Materials was down 4.82%.

In software, Oracle was down 4.78%, Palantir was down 7.64%, Palo Alto Networks was down 7.69%, and CrowdStrike was down 7.51%.

This time, the pattern of “even if semiconductors are weak, software will support them” did not hold.

3. Large-cap stocks and the overall market—not a broad decline, but not a reassuring spread either

Among large-cap tech, as of 5:00 AM, Meta was down 4.55%, Alphabet was down 2.67%, Microsoft was down 2.57%, and Amazon was down 2.13%.

On the other hand, Apple was up 0.46%. There are exceptions among large-cap stocks, and they cannot be lumped together.

The same applies to finance. JPMorgan was up 0.84% and Berkshire Hathaway was up 0.97%, but Goldman Sachs was down 1.53% and Morgan Stanley was down 0.94%.

In the overall market, the small-cap-focused Russell 2000 fell 1.7%. It is not the case that only large-cap tech fell while everything else was doing well.

From the price movements, one can see a cautious stance toward stocks with high growth expectations and a move to select consumer staples and the like. However, one cannot conclude the actual amount of capital movement or the reasons for investors’ buying and selling based on this alone.

4. Background: Caution regarding funding for AI investment, and rising crude oil prices

Reuters reports that concerns over the debt burden and investment recovery of AI-related companies are the backdrop for the tech decline on this day. Selling pressure was also applied to the stocks and corporate bonds of AI infrastructure company CoreWeave.

Another factor is crude oil.

Brent crude oil futures rose 3.72% to settle at $109.86 per barrel. This is against a backdrop of supply concerns in the Middle East. In reports reflecting the US market close on the same day, the dollar-yen was at 157.98 yen and the US 10-year Treasury yield was at 5.085%.

While high crude oil prices may support earnings expectations for energy companies, they also become a burden for other industries through fuel and transportation costs.

Furthermore, caution regarding AI-related companies cannot be explained simply by saying ‘stocks fell because interest rates rose.’ I believe there is also an awareness of the issue of whether large-scale investments can be recovered through future profits.

However, it is not possible to link the decline in individual time zones solely to specific news.

5. Outlook for the Tokyo market at the start of the week

First, I want to be cautious about semiconductors and manufacturing equipment. In the US, multiple stocks expanded their declines until the end, and there is a possibility that buyers in Japan will also become cautious.

For software and AI-related stocks, I also want to check whether the weakness in US stocks will lead to a reassessment of their valuation. However, since Japanese companies have different business contents and profit structures, it does not necessarily mean that they will show the same price movements just because they are in the same theme.

Conversely, high crude oil prices will be a clue for resource-related stocks. It is also a point of interest whether daily necessities and some domestic demand stocks can maintain relative strength when the overall market is unstable.

What I want to be careful about is not to assume that high US utility stocks directly mean high Japanese electric and gas stocks. The impact changes depending on fuel prices, exchange rates, and the ability to pass costs on to rates.

6. Sectors and price movements to check at the start of the week

I consider the priority for monitoring to be as follows.

• Semiconductors and manufacturing equipment: After starting lower, will the renewal of lows stop? Will multiple stocks in the same industry recover together?

• Resources and oil-related: Will the rise following the increase in crude oil prices continue? Will it not end with just an opening rise?

• Daily necessities and domestic demand-related: Can they maintain their value even if the index is weak? Is the rise not limited to only a few stocks?

• Information and communication/software: Will they move in conjunction with the US decline, or will they show resilience due to unique Japanese factors?

I will compare not only the Nikkei Stock Average but also the TOPIX, which captures a wide range of Japanese stocks, and the number of advancing and declining issues.

At the start of the week, I will reconfirm the dollar-yen, crude oil, US stock futures, and Nikkei futures. It is important not to take the results of the Friday US market as the conclusion for Monday.

7. Upside scenario and downside scenario

The upside scenario is a development where, even if semiconductor-related stocks start low, they absorb additional selling, and resource and domestic demand stocks support the market.

If they raise their lows after the opening and multiple stocks in the same sector rebound, I will consider the possibility that the US stock decline has been priced in to some extent.

The downside scenario is a development where selling spreads from semiconductors to information and communications, and further to other sectors.

If rising crude oil prices lead to concerns about corporate costs and are compounded by a stronger yen, there is a possibility that the rise in resource stocks alone will not be enough to support the index.

8. Precisely because the weekend is approaching, do not rush to judgment

In this US market, the recovery at 11:55 PM did not lead to a subsequent rebound.

Even at the start of the week, I do not want to conclude that it has “bottomed out” based solely on the initial rebound; I want to see if it fails to update its lows on the next dip.

Geopolitical news or corporate announcements over the weekend could change the premise. This is a market where I want to avoid being overly pessimistic due to the US stock decline, or overly optimistic just by looking at the rise in resource stocks.

What I will check is the stabilization of semiconductors, the sustainability of the rise in resource stocks, the spread to domestic demand stocks, and the direction of exchange rates and crude oil.

I will make my judgment after seeing where the Tokyo market actually holds its ground at the start of the week.