U.S. stocks took a hit last year as an economic downturn led the Nasdaq and NYSE composites to tumble 33% and 12% respectively over the past 12 months. Some of the hardest-hit companies were in the tech market, as spikes in inflation led to steep declines in consumer and commercial spending. Poor market conditions highlighted the importance of holding during a sell-off, as those who cut their losses last year will not have benefited from the recovery many companies have enjoyed this year. 

Apple (AAPL 1.22%), Microsoft (MSFT 1.75%), and Amazon (AMZN -0.58%) have each delivered double-digit stock growth since Jan. 1 despite suffering significant declines in 2022. These companies dominate their respective industries and make attractive stocks to hold over many years. 

So, here's why Apple, Microsoft, and Amazon are three top U.S. stocks to watch in October. 

1. Apple

Apple hasn't had an easy year. Despite stock growth of 32% year to date, its shares have actually fallen 12% since the start of August after posting disappointing third quarter of 2023 earnings. The period represented the company's third consecutive quarter of revenue declines, with net sales tumbling 1% year over year.

Economic challenges seemed to catch up with the company, with decreased revenue in three of its four product segments. iPhone, Apple's highest-earning segment, reported a 2% decline in net sales. The dip concerned investors as income from its smartphones regularly accounts for close to 50% of the company's total revenue.

However, the iPhone 15 launched at the end of last month, and early data shows the new generation of smartphones could be a hit with consumers. According to Counterpoint Research, wait times for the base model iPhone 15 are nearly double that of its predecessor. Meanwhile, its most expensive smartphone, the iPhone 15 Pro Max, has wait times of 48 days compared to 39 days this time last year. 

After a dip in its stock and signs of a return to growth in its highest-earning segment, Apple is worth keeping on your radar for a potential investment. 

2. Microsoft 

It feels like Microsoft made headlines on a nearly weekly basis this year. The company has emerged as one of the biggest names in artificial intelligence (AI), increasing its stake in ChatGPT developer OpenAI to 49% in January. Meanwhile, the tech giant is on the precipice of completing its acquisition of game developer Activision Blizzard after U.K. regulators gave preliminary approval last month. Both developments could offer Microsoft a significant boost to earnings over the long term. 

Regarding AI, Microsoft is using OpenAI's technology to bring upgrades across its software lineup. Word, Excel, Azure, and Bing all offer AI features now, with more to come. In July, the company unveiled CoPilot, an AI assistant that will soon be added to Microsoft 365 and cost $30 per month on top of the regular subscription price. The new feature represents Microsoft's effort to monetize its venture into AI and see a return on its hefty investment in the market. 

The company is a leader in productivity, with millions of consumers and businesses relying on its offerings daily. As interest in AI grows, it is well positioned to become the go-to for almost anyone looking to integrate the technology into their workflows. Microsoft has a solid outlook and plenty of exciting developments on the horizon, making its stock one to watch this month. 

3. Amazon

Amazon has revolutionized commerce in the U.S. and the world with its online marketplace that promises quality products at low prices and fast shipping. The company's stock skyrocketed during the COVID-19 pandemic, becoming the preferred option for homebound shoppers. However, economic challenges last year caused substantial declines in its retail profits and stock price.

So when Amazon posted a return to profitability in its North American segment in the first quarter of 2023 and topped $3 billion in operating income in the second quarter, Wall Street rallied. For reference, Q2 2022 saw its North American segment report $627 million in losses. Amazon shares have soared 49% year to date as a result.

Additionally, Amazon is making inroads in AI. The company's cloud platform, Amazon Web Services, introduced several new AI tools this year and announced a venture into chip development in June. Then, last month, news broke that Amazon would invest up to $4 billion in Anthropic, a rival to ChatGPT. 

The partnership will likely help Amazon retain its lead in the cloud market against competitors like Microsoft and Alphabet. Meanwhile, it can continue to attract new customers to AWS with advanced AI features. 

Amazon is on a promising growth trajectory, making its stock worth a spot on your watchlist.