Wall Street ends higher as the Anthropic listing lifts chip stocks and Meta raises its AI fundraising to $97.5 billion

The AI trade had been beaten down for weeks. On Tuesday it got its third good day in a row, and the reason was a filing.

Details of Anthropic's planned stock market listing, made public on Monday, lifted chip stocks again and pulled the Nasdaq to the front of the market. The Philadelphia Semiconductor index has outperformed the broader market this year, and it still sits more than 20 percent below its June 22 record close, as of October 27. "(The Anthropic news) seems to be giving a little bit of a relief rally to the AI stocks, particularly the semis," said Chuck Carlson, chief executive at Horizon Investment Services in Hammond, Indiana. "Those stocks have gotten clobbered in recent weeks and they were probably due for a bounce." Government data showing rising new orders for computers and peripheral equipment added support for the spending story behind the rally.

Meta showed the other side of the same story. The Facebook parent increased its largest ever equity fundraising to 97.5 billion dollars to pay for its AI buildout, and its shares went down while the market went up. Chip makers Nvidia, Advanced Micro Devices and Broadcom have shown interest in putting up to 5 billion dollars into the effort between them. The size of the raise is the story. The biggest technology companies are now funding data centers at a scale that competes with government budgets, and investors spent October asking whether the debt and the dilution will pay back. Tuesday's market answered that the spending still has believers.

Earnings did their share of the lifting. Nearly half of the companies in the S&P 500 have reported third quarter results, and 83 percent of them beat expectations, according to LSEG data, as of October 27. United Parcel Service advanced after raising its annual revenue and profit forecasts, and Royal Caribbean rose after lifting its full year profit forecast. Boeing tumbled on a third quarter loss bigger than analysts expected. Sherwin Williams missed on profit and dragged on the Dow, and the water company Xylem slid after trimming its forecasts.

The Federal Reserve sat in the background all day. The central bank opened its October meeting on Tuesday and is widely expected to hold its target rate at 3.75 to 4.00 percent on Wednesday. Microsoft and Alphabet report earnings on Wednesday and Amazon on Thursday, and their numbers will test the same question the Anthropic filing raised on Monday: whether the money pouring into AI comes back as revenue fast enough to justify what it costs.