By Shashwat Chauhan and Utkarsh Hathi
Oct 26 (Reuters) - Wall Street's main indexes edged up on Monday, led by advances in technology shares, while investors assessed Anthropic's IPO filing at the start of a week packed with corporate earnings and the Federal Reserve's interest-rate decision.
Anthropic disclosed steep losses and red-hot revenue growth in its filing for a US initial public offering, laying out its ambition to build AI systems capable of reshaping the global economy despite the high
costs of developing the technology.
The AI lab is pushing ahead with its listing plans even as a once-busy fall listing calendar has thinned out, with market volatility prompting companies to delay offerings.
"It's a challenging environment, to say the least exactly when this IPO will take place, but there's a lot riding on not only the company, but the AI industry," said Robert Pavlik, senior portfolio manager at Dakota Wealth In Fairfield.
Semiconductor and chip-related companies, widely viewed as some of the biggest winners of the AI boom, were leading the gains. The broader Philadelphia chips index was up around 1% after a turbulent few weeks.
Anthropic's filing also arrived at a time when investors are increasingly scrutinizing the payoff from AI spending. About a third of S&P 500 companies are scheduled to report earnings this week, including hyperscalers Alphabet, Microsoft and Amazon.com, whose results would be closely watched for signs if the hefty AI investments are translating into growth.
The focus follows a subdued reception to earnings from AI-linked megacaps last week. Meta disappointed investors after raising its annual AI spending forecast again and said it would sell new stock to help pay for it, while Tesla also came under pressure after its results.
Meta said on Monday it plans to raise up to $95 billion in equity to fund its AI-related expansion of data centers, cloud computing power and other infrastructure. Its shares were last down 1.8%.
The AI trade has come under pressure this month amid concerns that debt-funded spending may become harder to justify in the face of rising borrowing costs.
Neocloud firm CoreWeave fell 2% and Nebius dipped 4.8% after Elon Musk said in an X post markets have "almost entirely shut off access to money" for companies without substantial revenue independent of AI data centers, and predicted neocloud consolidation.
At 09:55 a.m. ET, the Dow Jones Industrial Average rose 236.42 points, or 0.45%, to 52,451.58. The S&P 500 gained 43.20 points, or 0.57%, to 7,666.88, while the Nasdaq Composite edged up 119.43 points, or 0.46%, at 26,074.96.
Market breadth was strong, with 10 of the 11 S&P 500 sectors trading higher. Consumer discretionary and industrials led the gains.
Megacap and growth stocks were mixed. Tesla jumped 5.9% to a more than three-month high after Barclays upgraded its rating on the stock to "overweight" from "equal-weight".
Crude oil prices eased after hitting a near six-month high last week. On Sunday, Qatari mediators traveled to Tehran as part of an effort to de-escalate regional tensions in coordination with the United States.
Elsewhere, the Fed's rate decision is due on Wednesday, with a pause widely expected after its September raise. Traders still see a December hike as firmly possible, and at least two 25-basis-point increases by mid-2027, according to LSEG data.
Both the Fed's preferred inflation gauge, the Personal Consumption Expenditures index for September, and third-quarter GDP, expected to show 3.2% growth, are due on Thursday.
Investors are also monitoring the November 3 midterm elections, which will decide control of the US Congress.
Advancing issues outnumbered decliners by a 1.73-to-1 ratio on the NYSE and by a 1.25-to-1 ratio on the Nasdaq.
The S&P 500 posted three new 52-week highs and three new lows, while the Nasdaq Composite recorded 44 new highs and 180 new lows.
(Reporting by Shashwat Chauhan and Utkarsh Hathi in Bengaluru; Additional reporting by Anand Gopal; Editing by Shilpi Majumdar)
