What Happened?
A number of stocks fell in the afternoon session after a broad pickup in energy expenses lifted September inflation to 3.7%, surpassing expectations and driving bond yields higher.
The hotter-than-anticipated inflation reading dampened market sentiment across Wall Street, weighing heavily on major benchmark indexes and pulling equities down from recent highs. When inflation accelerates, it often increases expectations that borrowing costs will remain elevated for an extended period to curb economic overheating. Elevated interest rates can compress corporate valuations, particularly across growth sectors such as technology and semiconductors, where future earnings expectations play a central role in pricing.
Semiconductor shares faced extended pressure, marking their seventh consecutive session of declines as market participants recalibrated risk appetites. Beyond higher financing expenses, persistent energy-driven inflation risks squeezing operating margins and weakening broader enterprise spending. Investors are continuing to evaluate whether persistent price pressures will lead to tighter financial conditions and prolonged headwinds for capital-intensive industries.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Hardware & Infrastructure company Super Micro (NASDAQ: SMCI) fell 5.8%. Is now the time to buy Super Micro? Access our full analysis report here, it’s free.
- Enterprise Networking company Applied Digital (NASDAQ: APLD) fell 9.5%. Is now the time to buy Applied Digital? Access our full analysis report here, it’s free.
- Electronic Components & Manufacturing company Benchmark (NYSE: BHE) fell 3.6%. Is now the time to buy Benchmark? Access our full analysis report here, it’s free.
- Data & Business Process Services company Planet Labs (NYSE: PL) fell 5.3%. Is now the time to buy Planet Labs? Access our full analysis report here, it’s free.
- IT Distribution & Solutions company Ingram Micro (NYSE: INGM) fell 4%. Is now the time to buy Ingram Micro? Access our full analysis report here, it’s free.
Zooming In On Applied Digital (APLD)
Applied Digital’s shares are extremely volatile and have had 99 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 8 days ago when the stock gained 2.7% on the news that the company entered into an agreement granting access to up to 1 gigawatt of potential power capacity in Finland to construct a large-scale AI Factory campus, marking its first international expansion outside the United States. According to the company's announcement, initial power availability for the Nordic development is targeted for 2028.
Applied Digital stated that it is engaged in active discussions with hyperscale clients to support specialized artificial intelligence workloads at the facility. Access to gigawatt-scale power infrastructure represents a critical operational milestone for high-performance computing providers amid surging artificial intelligence infrastructure needs. Expanding into Europe allows the company to broaden its operational footprint beyond domestic facilities while establishing capacity to serve global cloud customers.
Applied Digital is down 27.6% since the beginning of the year, and at $20.34 per share, it is trading 59% below its 52-week high of $49.65 from May 2026. Despite the year-to-date decline, investors who bought $1,000 worth of Applied Digital’s shares 5 years ago would now be looking at an investment worth $1,094.
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