What Happened?

A number of stocks jumped in the afternoon session after confidence in the artificial intelligence market was renewed, pushing both the S&P 500 and Nasdaq to new all-time intraday highs. 

The rebound was led by chipmaker Nvidia, whose shares rose nearly 2% after its CEO confirmed that demand for computing has "gone up substantially" in recent months. These comments helped reassure the market that the AI boom is supported by genuine demand, calming fears that were sparked a day earlier by a report questioning the profitability of Oracle's cloud business. The rally was strong enough to put the information technology sector on pace for a fresh closing high. This upward momentum occurred despite potential headwinds from an ongoing U.S. government shutdown, which entered its second week.

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:

• Specialized Technology company Mirion (NYSE: MIR) jumped 4.8%. Is now the time to buy Mirion? Access our full analysis report here, it’s free for active Edge members.
• Satellite Telecommunication Services company Globalstar (NASDAQ: GSAT) jumped 4.2%. Is now the time to buy Globalstar? Access our full analysis report here, it’s free for active Edge members.
• IT Services & Consulting company Grid Dynamics (NASDAQ: GDYN) jumped 5.2%. Is now the time to buy Grid Dynamics? Access our full analysis report here, it’s free for active Edge members.
• Hardware & Infrastructure company Hewlett Packard Enterprise (NYSE: HPE) jumped 4%. Is now the time to buy Hewlett Packard Enterprise? Access our full analysis report here, it’s free for active Edge members.
• Digital Media & Content Platforms company Rumble (NASDAQ: RUM) jumped 3%. Is now the time to buy Rumble? Access our full analysis report here, it’s free for active Edge members.

Zooming In On Grid Dynamics (GDYN)

Grid Dynamics’s shares are very volatile and have had 23 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 1 day ago when the stock dropped 5.5% on the news that broader macroeconomic concerns, including an ongoing government shutdown and anticipation of commentary from Federal Reserve officials, began to weigh on investor sentiment. After reaching new record highs, major U.S. indices like the S&P 500 and Nasdaq experienced a slight retreat. This pause came as investors grappled with the potential economic impact of a partial government shutdown, which had dampened consumer confidence and delayed the release of key economic data, such as September's nonfarm payrolls. The market appeared to be in a holding pattern as traders anticipated signals from Federal Reserve officials, looking for clues on future monetary policy. The caution in the broader market suggests that wider economic anxieties are currently overriding recent sector-specific optimism.

Grid Dynamics is down 61.7% since the beginning of the year, and at $8.42 per share, it is trading 65% below its 52-week high of $24.05 from February 2025. Investors who bought $1,000 worth of Grid Dynamics’s shares 5 years ago would now be looking at an investment worth $1,060.

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