What Happened?
Shares of data center products and services company Vertiv (NYSE: VRT) fell 3.2% in the morning session after Wolfe Research downgraded its stock from Outperform to Peer Perform and the company was not selected for inclusion in the S&P 500 index. Adding to the pressure, S&P Dow Jones Indices announced that Ares Management would join the benchmark index, while Vertiv, a data-center infrastructure company, was among those that missed out this round. Inclusion in a major index like the S&P 500 often leads to increased demand for a stock from index-tracking funds. Therefore, being passed over was viewed as a setback by investors.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Vertiv? Access our full analysis report here.
What Is The Market Telling Us
Vertiv’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 19 days ago when the stock dropped 5% on the news that markets faded the Nvidia rally in the morning session, as investors remained uncertain about future rate cuts.
While the trading day began with significant enthusiasm, pushing the Dow Jones Industrial Average up more than 700 points and the Nasdaq Composite up 2.6%, momentum quickly evaporated as the session wore on. The primary catalyst for this sharp reversal was a stronger-than-expected jobs report, which reduced the implied odds of a December interest rate cut to less than 40%. This macroeconomic anxiety overshadowed stellar corporate performance. Nvidia initially surged 5% on blockbuster earnings and CEO Jensen Huang's bullish outlook on "off the charts" demand for Blackwell chips. However, the stock eventually turned negative, acting as a heavy weight that dragged the broader indices into the red. The sell-off partly reflects a deepening caution regarding high-flying tech valuations in a "higher-for-longer" rate environment. Consequently, investors appeared to rotate capital away from volatile growth sectors and toward defensive staples, evidenced by Walmart's 6% gain following its own earnings beat. Ultimately, the market could not sustain the morning's euphoria, as traders prioritized rate realities over AI potential.
Vertiv is up 53.2% since the beginning of the year, and at $181.23 per share, it is trading close to its 52-week high of $199.27 from October 2025. Investors who bought $1,000 worth of Vertiv’s shares 5 years ago would now be looking at an investment worth $9,579.
While Wall Street chases Nvidia at all-time highs, an under-the-radar semiconductor supplier is dominating a critical AI component these giants can’t build without. Click here to access our full research report.
