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AI Builders Sold, AI Users Bought; Chips in Bear Market

AI Trade — builders and runners sold, users bought: chips enter a bear market, Accenture +9.9% on the week

Our AI build-out index fell 13.5% and the running-costs index 14.2%; AI apps held until Friday. The companies that put AI to work — Accenture, Cognizant, Infosys — rose all week, even on Friday.

In this edition

INFY CTSH ACN EPAM ADP SOXX AMD MU

The Morning 10 Mon, Oct 19, 2026 ~90 seconds 08:00 CET

The ten points

Last week split the AI trade in four. The companies that build AI capacity fell hardest: our Rubin 100 build-out index lost 13.5% and the Ecosystem index, which tracks what it costs to run AI, 14.2%. The companies that sell AI products held up — the Winners index was 1.5% higher on the week until Thursday and ended 0.5% lower after Friday. The companies that put AI to work rose: Infosys gained 14.1%, Cognizant 11.5% and Accenture 9.9%, all three even on Friday. That is the group our fifth AI index, AI Users, is being built for.

The chip stocks are now officially in a bear market. The Philadelphia chip index closed Friday at 11,137, 23.9% below its record of 22 June, after eight losing days in a row — its longest streak in 16 years, as reported by Barchart. The Nasdaq-100 fund QQQ fell 2.5% to 709.80, through its 728.95 support line and 0.8% above the September low, as software joined the selling (IGV −4.8%). The Dow fell only 0.3% and ended the week 0.7% higher.

This morning is calmer. Nasdaq futures are up 1.4% and the Kospi rose 1.5%; the Nikkei slipped 0.6% and Hong Kong was shut for a holiday. China grew 4.5% in the third quarter, a little better than the 4.4% expected. Brent crude fell 1.8% to $107.86 after President Trump put new Russia sanctions on hold. ASML's earnings window closes at tonight's US close.

  1. Our AI indices — capex −13.5%, opex −14.2%, apps −0.5%; AI users bought
  2. AI users — Infosys +14.1%, Cognizant +11.5%, Accenture +9.9% on the week; up even on Friday
  3. Chips — bear market: index 23.9% below its June record after eight losing days; AMD −5.9%, Micron −5.6%
  4. Nasdaq-100 — QQQ breaks its support line, closes at 709.80, down 2.5%
  5. AI apps — software sold on Friday: IGV −4.8%; Snowflake −8.4%, Palo Alto −7.6%, Palantir −7.2%
  6. CoreWeave — −11.9% to 61.39, −25.2% on the week; Oracle −4.6%
  7. Asia — Kospi +1.5%, Nikkei −0.6%, Tokyo Electron −2.3%; Hong Kong shut
  8. China — growth 4.5%, a little above forecast; memory maker CXMT −7%; Jakarta −5% more
  9. Oil, rates and defensives — Brent −1.8% on Russia sanctions pause; staples +5.0% on the week
  10. This week — ASML scored tonight, TSMC Tuesday; Tesla, Meta, IBM, SAP and Lam Research Wednesday

  1. Our AI indices — capex −13.5%, opex −14.2%, apps −0.5%; AI users bought

    Index
    What
    Each of our AI indices answers one question about where the money in AI is made. On the week: Rubin 100, the companies that build AI capacity (capex), fell 13.5% and is 26.8% below its 22 June high. The Agentic Ecosystem index, the companies paid to run AI (opex), fell 14.2%. Agentic Winners 40, the companies that sell AI products, was up 1.5% on the week until Thursday and lost 2.0% on Friday to end 0.5% lower. In Rubin, 107 of 126 names are losing strength; in Winners, 33 of 40 are still gaining. The fifth index is in the works: AI Users, the companies whose existing business gets more profitable by using AI. It has no members yet, but the names on its early watch list had their best week in a long time (point 2). HALO 100, our index of growth outside AI, lost 0.5%.
    If
    Winners and the AI users hold their gains while Rubin falls further
    Why
    as long as the companies that use AI are bought, the market is repricing the build-out, not giving up on AI
    Then
    the AI board has the full table of the four live indices

    Open the detail →

  2. AI users — Infosys +14.1%, Cognizant +11.5%, Accenture +9.9% on the week; up even on Friday

    Structure

    INFYCTSHACNEPAMADP

    What
    The companies that build AI into other firms' businesses had their week. Infosys (US shares) rose 14.1% to 12.24, Cognizant 11.5% to 66.03, Accenture 9.9% to 229.68 and EPAM 7.9%. India's IT index rose 11.7%, its best week since 2008 as reported by Business Standard, after TCS reported $9.6 billion of new orders. On Friday, when the Nasdaq fell 2.1%, Accenture still gained 2.1%, Infosys 0.9% and Cognizant 0.4%. Companies that use AI in their own operations were bought too: payroll firm ADP rose 6.7%, UnitedHealth 5.8%, JPMorgan 2.0%. India's IT index slipped 1.0% this morning.
    If
    Accenture and Infosys hold their gains through this week's bounce in chips
    Why
    the implementers' order books are the earliest hard sign that companies are moving from buying AI capacity to using it; their shares say the market has started to price that shift
    Then
    the Accenture page carries the chart and the scores

    Open the detail →

  3. Trade the Look Global Generation — owning the whole distribution instead of guessing the tail, run as a wikifolio. See the wikifolio →

  4. Chips — bear market: index 23.9% below its June record after eight losing days; AMD −5.9%, Micron −5.6%

    Structure

    SOXXAMDMUAVGOTSMNVDA

    What
    The Philadelphia chip index fell 3.8% on Friday to 11,137 and 11.4% on the week, its worst week since April 2025, as reported by AP and Yahoo Finance. It now stands 23.9% below its record close of 14,635 on 22 June — a bear market by the usual 20% rule, for the second time since July. Eight losing days in a row is its longest streak in 16 years. The chip fund SOXX fell 4.1% to 493.39 (24.7% below its June high); SMH, heavier in Nvidia, is 19.3% below. AMD lost 5.9% to 528.75, Micron 5.6% to 878.84 (27.6% below its June high), Broadcom 4.5% to 328.75, TSMC's US shares 2.3% to 412.61 and Nvidia 1.4% to 214.13 — only 10.5% below its 6 October high.
    If
    the chip index ends a day higher this week — the streak has to break before it can turn
    Why
    eight down days in a row is rare; such streaks tend to end with a sharp bounce, but the bounce only counts if it holds past the next earnings print
    Then
    Rubin 100 holds the chip makers by layer of the AI build-out

    Open the detail →

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