Retail investors are buying the dip, in record amounts

Retail investors are back in buy-the-dip mode, helping lift the Nasdaq 100 and S&P 500 sharply higher on renewed optimism for rate cuts and strong earnings. Lithium stocks are showing signs the bottom may be over, with prices and momentum surging as demand rebounds and supply tightens. Here is what you need to know, what to consider and stocks to watch.

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News that you need to know now

Retail investors are back — and buying the dip. They’re piling into stocks such as Tesla, Nvidia, Intel, and AMD, which all moved up between 1% and 3% overnight. Intel gave a sparky forecast, saying personal computer demand grew more than expected, which boosted optimism for its continuing comeback. Intel’s profit also came in well above estimates. All in all, the Nasdaq 100 $NASDAQ 100 Index (.NDX.US)$ gained 0.9% overnight and is now up 52% from April’s tariff-crash lows. The broader S&P 500 $S&P 500 Index (.SPX.US)$ is up 40%.

In other news, oil prices are surging. Oil jumped 5.36% overnight after the US sanctioned Russia’s biggest oil companies — oil’s biggest one-day gain since June. Yesterday we touched on why you should keep an eye on Halliburton $Halliburton (HAL.US)$ and Beach Energy $Beach Energy Ltd (BPT.AU)$ — both have extended their gains. Halliburton is up 22% in the first four trading days of this week. Other energy-related names are also surging, such as Dover Corp, APA, and Valero, with bets that energy companies could be squeezed higher.

In terms of what other news you need to know. US bond yields and the US dollar are trading around their lowest levels of the year — good news for equities. But if we don’t see a rate cut in the US next week, or if the meeting between the heads of China and the US doesn’t resolve trade issues, things could get rocky quickly. Bitcoin has also climbed, now trading just shy of US$110,000, and futures are pointing to a positive day across Asian markets.

Focus & consider retail investors are back — they’re buying the dip.

The rebound we’re seeing in markets is a classic buy-the-dip story. Yesterday was the fifth most active trading session of the year — more than 25 billion shares traded compared with the 17-billion average.

Retail investors (that's you and me) — are diving into markets when they see prices fall, such as Tesla yesterday. A few promising developments are fuelling their optimism, including expectations of US rate cuts, signs of resilience in the US economy, and strong company earnings. Let’s unpack these points.

So far this reporting season, US company earnings have impressed. 140 of the S&P 500 companies have reported their July–September results, coming in 8% above expectations, with 15% average earnings growth. These are the kinds of results that give investors confidence.

Another central focus is US interest rates. Next week, the Federal Reserve is expected to cut rates — markets are betting on a 99% chance of a 0.25% cut. Beyond making it easier for companies to finance their plans, this lowers returns on cash, tempting investors back into equities.

And there’s a lot of cash waiting to move — more than US$7 trillion in money-market funds. That could flow into stocks if we see rate cuts, strong earnings, and easing geopolitical tensions. Expect some of this cash to be deployed especially during any pullback, when buy-the-dip thinking takes hold — just as we saw overnight.

Whether this market bounce develops further or fades will depend on next week. Most of the “Magnificent Seven” report on October 30–31 — Google, Meta, and Microsoft on October 30, followed by Apple and Amazon on October 31. Excluding Nvidia, these are the largest and most influential companies by market cap. If they deliver stronger-than-expected results and upbeat outlooks, markets could rally further.

Stocks to watch - Lithium giant, oil stocks and Intel

- Albemarle $Albemarle (ALB.US)$ — the world’s biggest lithium company — is among the S&P 500’s top performers this week, up 6.7% Monday to Thursday and now 96% above its April lows. Locally, keep an eye on Pilbara Minerals $PLS Group Ltd (PLS.AU)$ Australia’s largest lithium producer, up 178% from March lows. See ALB chart below.

Why watch these? Lithium carbonate prices are up 29% from June lows as demand climbs. Lithium makes up about 30% of an EV battery, and with Tesla and BYD both forecasting record EV sales (1.6M and 2.1M respectively in 2025), lithium demand is set to rise further.

- Karoon Energy $Karoon Energy Ltd (KAR.AU)$ — shares are breaking higher after this week’s oil price surge. From Monday to Thursday, Karoon is up 10%, making it the second-best-performing ASX stock behind Beach Energy (+15%). While still 29% below this year’s highs, technical indicators suggest Karoon and other oil names could continue rallying as supply concerns lift oil prices.

- Intel Corp $Intel (INTC.US)$ — shares jumped 7% after hours as the company returned to profitability and gave an upbeat revenue forecast. The chipmaker is showing strong progress in its comeback, with personal computer demand growing faster than expected. Quarterly revenue surged to $13.6 billion, bringing its 12-month total to $53 billion. Analysts may upgrade earnings forecasts — one to watch.