What happened?
A number of stocks fell in the afternoon session after hotter-than-expected October consumer inflation and hawkish Federal Reserve commentary reignited interest rate worries.
The pullback followed the October consumer price index report released by the Bureau of Labor Statistics, where headline inflation rose 0.4% month over month, exceeding the 0.3% increase projected by economists polled by Dow Jones, as reported by CNBC. Further pressuring sentiment, Federal Reserve Governor Christopher Waller stated in a speech carried by CNBC that a December rate hike is likely, adding that policymakers should consider a 50-basis-point increase if price pressures persist to protect central bank credibility. This interrupted a strong rebound from the previous session, when the S&P 500 rose 2.4% and the Nasdaq Composite climbed 2.7%, according to CNBC. The pullback was more pronounced in growth-oriented technology stocks as higher rate projections disproportionately affect long-duration cash flows.
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:
- E-commerce software company Wix (NASDAQ: WIX) fell 5.7%. Is now the time to buy Wix? Access our full analysis report here, it’s free.
- Data infrastructure company Elastic (NYSE: ESTC) fell 5.6%. Is now the time to buy Elastic? Access our full analysis report here, it’s free.
- Project management software company Atlassian (NASDAQ: TEAM) fell 5.1%. Is now the time to buy Atlassian? Access our full analysis report here, it’s free.
- Data infrastructure company C3.ai (NYSE: AI) fell 3.8%. Is now the time to buy C3.ai? Access our full analysis report here, it’s free.
- Video conferencing company Five9 (NASDAQ: FIVN) fell 3.6%. Is now the time to buy Five9? Access our full analysis report here, it’s free.
Zooming in on Wix (WIX)
Wix’s shares are extremely volatile and have had 47 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 25 days ago when the stock dropped 7.8% on the news that investors shifted their focus from what AI technology can do toward concerns over how companies will finance it.
Driven by these escalating AI funding fears and elevated interest rates, CNBC noted that a massive rotation out of the sector erased more than $1 trillion from the world's largest semiconductor and AI-related stocks this week. Furthermore, CNBC explained that this funding anxiety triggered counterintuitive moves in the broader market, as investors reassessed the impact of high interest rates on corporate debt-servicing capacity and overall economic growth.
Because of these rising structural risks, CNBC reported that safe-haven demand temporarily outweighed inflation fears, prompting capital to exit high-growth tech assets and flow into the Treasury market, which ironically pulled the 10-year Treasury yield down toward 5.09 percent. Ultimately, according to CNBC analysts, this widespread tech sell-off underscores a growing realization on Wall Street that if the capital-intensive AI trade slows due to financing constraints, broader economic growth will likely decelerate as well.
Wix is down 35.9% since the beginning of the year, and at $64.72 per share, it is trading 51.3% below its 52-week high of $132.97 from November 2025. Investors who bought $1,000 worth of Wix’s shares 5 years ago would now be looking at only $326.54.
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