Stocks Rebound After Weak Open as Small Caps Outperform
U.S. stocks opened lower but turned higher by mid-morning, with the Russell 2000 gaining more than 1% and the S&P 500 recovering from overnight losses. Technology remained under pressure amid concerns about AI fundraising, a sharp drop in a South Korean data-center IPO, and debt-heavy data-center companies. Housing data was weak, while health care, utilities, REITs, and staples posted strong gains.
The session reversed an early decline as small-cap shares led, with the Russell 2000 up more than 1% and the S&P 500 erasing overnight weakness. Technology stayed under scrutiny: OpenAI was reported to be speeding up a roughly $30 billion raise at about a $1.4 trillion valuation ahead of Anthropic’s IPO, while South Korea’s Kospi fell about 3.5% after data-center firm Elice dropped over 30% on debut.
Housing figures were soft, including a 5.9% monthly fall in starts to a 1.221 million annual rate and a 7.3% drop in pending sales. Defensive areas—health care, utilities, REITs and staples—were strong, and health care reached record highs.
The rebound may offer modest relief to investors and retirement savers, but continued technology weakness could weigh on pension funds and household portfolios. Weak housing data may reinforce affordability pressure for prospective buyers and affect builders and real-estate agents. Data-center funding concerns could influence local infrastructure debates and employment in related construction and technology sectors, though the direction remains uncertain.