- 3i (IGQ5 TH) +1.1%
- Kion (KGX TH) -2.9%
- Novo (NOV TH) -3%
- RENK Group (R3NK TH) -3.1%
- Watch Defense Stocks as Zelenskiy Reviews Ukraine Peace Plan
- Siemens Energy (ENR TH) -3.2%
- Infineon (IFX TH) -3.2%
- Stocks Head for Worst Week Since April on AI Slump: Markets Wrap
- Bilfinger (GBF TH) -3.3%
- Hensoldt (HAG TH) -3.7%
- Watch Defense Stocks as Zelenskiy Reviews Ukraine Peace Plan
- BE Semiconductor (BSI TH) -3.8%
- ASML (ASME TH) -4.3%
- Stocks Head for Worst Week Since April on AI Slump: Markets Wrap
- ASM Intl (AVS TH) -4.7%
- Stocks Head for Worst Week Since April on AI Slump: Markets Wrap
>>> Up
* Do & Co Raised to Buy at Wood & Company; PT 224 euros
* Experian Raised to Buy at Citi; PT 3,907 pence
* Norbit Raised to Buy at SB1 Markets; PT 200 kroner
* Norbit Raised to Buy at SB1 Markets; PT 200 kroner
* SCA Raised to Equal-Weight at Barclays; PT 115 kronor
* Wetteri Oyj Raised to Reduce at Inderes; PT 18 euro cents
>>> Down
>>> Down
* AMS-Osram Cut to Hold at Jefferies; PT 8.30 Swiss francs
* Hologic Cut to Neutral at BNPP Exane; PT $79
* Ithaca Energy Cut to Sell at Goldman; PT 180 pence
* UPM-Kymmene Cut to Equal-Weight at Barclays; PT 22 euros
* UPM-Kymmene Cut to Equal-Weight at Barclays; PT 22 euros
* Viridien Cut to Market Perform at Bernstein; PT 117 euros
>>> Initiation
>>> Initiation
* Advini Rated New Outperform at Oddo BHF; PT 16 euros
* AMD Reinstated Outperform at Raymond James; PT $377
* ARM Holdings ADRs Reinstated Market Perform at Raymond James
* Broadcom Reinstated Outperform at Raymond James; PT $420
* Do & Co Rated New Outperform at Oddo BHF; PT 240 euros
* Eicher Reinstated Buy at William O'Neil
* Einhell Rated New Buy at Berenberg; PT 110 euros
* Intel Reinstated Market Perform at Raymond James
* Interparfums Rated New Buy at Berenberg; PT $103
* Kingfisher Rated New Add at Peel Hunt; PT 320 pence
* Marvell Technology Reinstated Strong Buy at Raymond James
* Nvidia Reinstated Strong Buy at Raymond James; PT $272
* Theon International Rated New Buy at ING; PT 37.50 euros
>>> Call
>>> Call
* AMS-Osram Trends ‘Plateauing,’ Downgraded to Hold at Jefferies
* Do & Co Outperform at Oddo BHF on Strong Revenue Growth Path
* Do & Co Outperform at Oddo BHF on Strong Revenue Growth Path
* Experian Upgraded at Citi on AI Opportunity, Mortgage Recovery
* L’Oreal Gets Positive Watch at Citi on Underappreciated Growth
Stocks are poised for their worst week in seven months as concerns over lofty valuations and whether massive investments in artificial intelligence will pay off prompt investors to retreat from riskier assets. The MSCI All Country World Index has fallen almost 3% this week, putting it on track for its sharpest weekly drop since April 4, when President Donald Trump’s tariffs rattled markets. Asian shares slumped 1.6% on Friday — also heading for their weakest week since April — after Wall Street indexes retreated on Thursday. Adding to the cautious mood, cryptocurrencies dropped, with Bitcoin trading below $86,000. The Kospi Index — a poster child for AI exuberance — tumbled as much as 4.2% as volatility spiked on Wall Street and technology stocks took a beating. Sentiment appeared to stabilize with futures contracts indicating a gain for the S&P 500 index after the underlying gauge slipped to the weakest level since September. Treasuries also gave up some of their gains with the yield on the 10-year edging up one basis point to 4.09%. In Asia, the focus was on Japan, where Prime Minister Sanae Takaichi’s cabinet approved the largest round of extra spending since the pandemic. The yen held steady against the dollar after the stimulus plan, which includes ¥17.7 trillion ($112 billion) in general account spending. The sharp reversal in market sentiment came as lingering concerns over stretched valuations and heavy tech spending curbed a rally fueled by Nvidia’s upbeat forecast, with the AI bellwether’s shares sliding 3.2%. Adding to the unease was persistent uncertainty over the Federal Reserve’s ability to cut interest rates next month, as recent remarks from policymakers signaled caution about easing policy too soon. On Thursday, the S&P 500 benchmark logged its biggest intraday reversal — at 3.6% — since the height of the tariff turmoil in April, according to data compiled by Bloomberg. The gauge has now fallen 5% from its most recent peak. Goldman Sachs Group Inc. partner John Flood said that since 1957, there have been eight instances, including Thursday’s, in which the S&P 500 opened more than 1% higher only to reverse and close in the red. On the bright side, average performance after those episodes was positive, with a gain of at least 2.3% in the following day and week and a 4.7% advance in the next month. The Cboe Volatility Index rose to 26.42, the highest since April. The index didn’t close at a session high, which suggested “volatility fears are elevated, but not extreme,” said Chris Murphy, co-head of derivatives strategy at Susquehanna International Group, in a note late Thursday. The heightened swings came just ahead of Friday’s expiration of an estimated $3.1 trillion of notional options.
Thursday also brought the release of a long-delayed government employment report, which showed that US job growth picked up in September, while the unemployment rate ticked higher. The data suggested the labor market showed signs of stabilizing before the government shutdown. The figures come a day after minutes from the Fed’s last policy meeting showed a divided committee on whether to cut rates again.
Fed Governor Michael Barr said the US central bank needs to proceed with caution in considering additional rate cuts with inflation still running above the target. Fed Bank of Cleveland President Beth Hammack said lowering rates to support the labor market could extend the period of above-target inflation and increase financial stability risks. Her Chicago counterpart Austan Goolsbee signaled that he’s still apprehensive about delivering another rate cut at the central bank’s December meeting. “Investor concerns over valuations coupled with a mixed employment report dominated sentiment in the session,” Nick Twidale, chief market analyst at AT Global Markets in Sydney, said about the US trading day. “It does now feel that we are in a ‘sell rallies’ environment at the moment and the top is in for the rest of the year.” In commodities, oil was on track for a weekly loss of more than 2%, with Brent trading below $63 a barrel. Crude’s leg lower came as Ukrainian President Volodymyr Zelenskiy agreed to work on a peace plan, just as US sanctions on two Russian oil giants are scheduled to take effect on Friday. US After Hours GAP +4.9%, INTU +3.2%, ROST +2.8% higher on earnings; C +0.3% realigns segments, new CFO; ESTC -11.9% lower on earnings.
Nikkei -2.40% Hang Seng -1.76% CSI -2.09% Shanghai -2.10% Shenzen -2.99%
Eur$ 1.1539 CNH 7.1144 CNY 7.1124 JPY 157.18 GBP 1.3089 CHF 0.8044 RUB 79.9019 TRY 42.4431 WTI$ 58.11 -1.51% Gold 4,050 -0.64% BTC 85.345 -2.14% ETH 2,783 -3.20% SOL 130.79 -2.45%
S&P +0.30% Nasdaq +0.18% EuroStoxx -1.40% FTSE -1.02% Dax -1.37% SMI -0.84%
Macro :
- Airlines Holiday Bookings Hurt by Shutdown, Hassett Says
- Michael Saylor’s Strategy Risks Losing Billions in Index Flows
- Taiwan’s Wu Says US Won’t Put ‘Punishing’ Tariffs on Chips: FT
- Goldman’s Flood Sees ‘Extreme’ Focus on Hedging Driving Selloff
- Brussels set to issue formal warning to Italy over ‘golden power’ rules
Keep an eye on :
Keep an eye on :
- ACKB BB : Ackermans Maintains FY Net Income Forecast
- ALTR PL : Altri 9M Net Income EU12.4M Vs. EU89.6M Y/y
- ASC LN : Asos FY Revenue Misses Estimates
- BAB LN : Babcock 1H Adjusted Revenue Meets Estimates
- BEKB BB : Bekaert Sees FY Sales About EU3.7B, Est. EU3.74B
- EN FP : French Telcos Mull Wider Bid for Billionaire Drahi’s Assets: FT
- CARLB DC : Carlsberg Agrees New Power Purchase Agreements Across Nordics
- CAMB SS : Norion Bank Offers to Buy Consensus Asset Management
- EVD GY : CTS Eventim 3Q Normalized Ebitda Beats Estimates, CTS Eventim Beats as Live Entertainment Improves, Analysts Say
- CAN LN : Canal+ Secures Renewal of Exclusive Coverage Rights for UEFA Club Competitions
- 1 HK : Conglomerate CK Hutchison Weighs Dual Listing of Health & Beauty Retail Giant
- CVC NA : Asurion Is Said to Near Deal for CVC-Backed Domestic & General
- CVC NA : Asurion Is Said to Near Deal for CVC-Backed Domestic & General
- EQT SS : EQT Said to Near €2 Billion Deal to Buy Desotec from Blackstone
- ESTC US : Elastic 3Q Revenue Forecast Beats Estimates
- EXENS FP : France’s AMF Exempts HLD, IPHG From Making Exosens Offer
- FRAS LN : Frasers Group Buys Braehead Shopping Centre in Glasgow; No Terms
- GAP US : Gap Sales Beat Estimates on Celebrities, Collaborations, Gap Climbs on Strong Old Navy, Banana Republic Performance
- GOOGL US : Robotics Startup Physical Intelligence Valued at $5.6 Billion
- GSK LN : GSK Subsidiary Tesaro Initiates Litigation Against Anaptysbio
- INTC US : Intel CEO Dismisses Concerns About New Hire Bringing TSMC’s Tech
- INVP LN : Investec S.Africa Seeks More Speed in Public-Pvt Infrastructure
- JUVE IM : Italian Football Club Juventus Seeks Fresh Funds with Share Sale
- KINVB SS : Kinnevik Parts Ways With CEO Amid Lackluster Portfolio Returns
- MSTR US : Michael Saylor’s Strategy Risks Losing Billions in Index Flows
- NORION SS : Norion Bank Offers to Buy Consensus Asset Management
- NVDA US : Taiwan Approves Nvidia’s NT$1b Investment in Office Building
- ORA FP : French Telcos Mull Wider Bid for Billionaire Drahi’s Assets: FT
- RYA ID : Ryanair Pledges Investment in France If Government Scraps Tax
- STLA US : Stellantis to Assemble Cars from China’s Leapmotor in Brazil
- TKTT FP : Tarkett Participation Buyout Offer for Tarkett to Reopen: AMF
- TEF SM : TelefóNica Gets Exclusive Media Rights of UEFA Champions League
- VIE FP : Veolia Agrees to Buy US Firm Clean Earth for $3b EV From Enviri
After Hours Summary: GAP +4.9%, INTU +3.2%, ROST +2.8% higher on earnings; C +0.3% realigns segments, new CFO; ESTC -11.9% lower on earnings
After Hours Gainers:
Companies trading higher in after hours in reaction to earnings/guidance: GAP +4.9%, INTU +3.2%, ROST +2.8%, MATW +1.8% (also strategic alternatives review remains ongoing), UGI +0.8%
Companies trading higher in after hours in reaction to news: CRSR +6.3% (names new CFO), DCTH +3.4% (authorizes new $25 mln share repurchase program), DDS +1.2% (declares $30/sh special dividend), MDU +0.8% (announces increased capital investment plan for 2026-2030), HBB +0.8% (authorizes new $25 mln share repurchase program), DUK +0.5% (proposes new investments in North Carolina), C +0.3% (realigns segments; Retail Banking and US Citigold to be integrated within Wealth; US Consumer Cards to become a standalone business; names new CFO), LPLA +0.2% (monthly activity for October), ASGN +0.2% (to rebrand as Everforth, new parent brand that will unify its six current brands; also announces $1 bln share buyback auth)
After Hours Losers:
Companies trading lower in after hours in reaction to earnings/guidance: GEOS -12.5%, ESTC -11.9%, PXED -11.7%, AUNA -10.1% (also strategic collaboration with Sojitz), ESE -4.9%, NGVC -3.6% (also increases dividend), CPRT -2.7%, BULL -2.4%, POST -2.1% (also Chairman to retire), VEEV -0.1%
Companies trading lower in after hours in reaction to news: CTNM -13.7% (topline data from its phase 2 PIPE-307 VISTA trial), IKT -4.6% (advancing IKT-001 to global Phase 3 Study; also commences public offering of common stock and warrants), HIVE -2.9% (files mixed securities shelf offering), AHR -2.5% (commences 8.1 mln share offering), EG -2.2% (names new CFO), OGE -2.2% ($345 mln stock offering), CRNX -1.9% (first patient randomized in pivotal Phase 3 CAREFNDR trial), VOYG -1.4% (JHG to make investment in Starlab Space), GEHC -1% (to acquire Intelerad for $2.3 bln), META -0.9% (directors reach $190 mln settlement to resolve privacy-related claims, according to Bloomberg), AI -0.5% (expanded integrations across Microsoft Copilot, Microsoft Fabric, and Azure AI Foundry), NKE -0.3% (increases dividend), INDV -0.3% (concludes legacy DOJ matter by paying $295 mln), STEL -0.3% (increases dividend), PFGC -0.2% (stock offering), BA -0.1% (awarded a $877 mln US Special Ops Command contract), CWT -0.1% (Hawaii unit files request to increase rates), TG -0.1% (CEO to retire, names new CEO)
Japan’s Takaichi unveils $135bn stimulus to spur growth
Package is prime minister’s first major policy announcement since taking office seven weeks ago
Japan’s Prime Minister Sanae Takaichi has unveiled a massive ¥21.3tn ($135.4bn) stimulus package designed to spur economic growth and shield households from the rising cost of living.
The highly anticipated package, which has been in the works since Takaichi became prime minister seven weeks ago and marks her first major policy initiative, is Japan’s largest since the Covid pandemic.
The package will primarily involve ¥17.7tn of spending and will be backed by a supplementary budget likely to be presented in coming weeks. Such a budget would be 27 per cent larger than the one secured a year ago by Takaichi’s immediate predecessor. It also involves ¥2.7tn of tax cuts and some funding from the special account.
The stimulus is aimed, in part, at offsetting some of the potential damage to Japan’s export-heavy economy caused by US President Donald Trump’s tariffs. It also aims to boost investment in national security-focused areas such as artificial intelligence and shipbuilding.
The stimulus was approved by Japan’s cabinet on Friday and follows turbulence in equity, bond and currency markets. After the cabinet approved the plan, the yen firmed slightly to reach about ¥157.13 against the US dollar in early afternoon trading in Tokyo.
The investment managers of several major global funds have voiced fears that Takaichi’s plans for more aggressive fiscal expansion could harm the country’s financial position.
Further government bond issuance is expected to fund the stimulus.
Earlier in the week, the yen tumbled to a 10-month low against the US dollar, while yields on the benchmark 10-year Japanese government bond rose to their highest level since the global financial crisis in 2008. Yields on 30- and 40-year JGBs surged to record highs on Thursday ahead of the announcement. Yields on the 10-year JGB fell one basis point to 1.795 per cent after the cabinet approved the plan.
Ex-Wirecard boss Jan Marsalek linked to multibillion-dollar laundering network
Link is latest revelation in a years-long probe into Smart and TGR, which move money for criminals and sanctioned individuals
Wirecard fugitive Jan Marsalek and a ring of Bulgarian spies he operated in the UK have been linked to a multibillion-dollar money laundering scheme that connects street-level drug dealers with sanctioned Russian oligarchs.
Two money laundering networks known as Smart and TGR were used by Russian intelligence services in an attempt to provide funding to Marsalek’s Bulgarian spies, according to the UK National Crime Agency.
The leader of the Bulgarian spy ring, Orlin Roussev, was jailed for 10 years and eight months in May alongside his five accomplices, all of whom were either convicted of spying for Russia or had pleaded guilty to having done so.
The link to Marsalek is the latest revelation in a years-long NCA investigation into Smart and TGR, which use cryptocurrency to move money for criminals and people under western sanctions.
The networks use couriers in Britain and elsewhere to collect physical cash generated from the drugs trade, firearms supply, and organised immigration crime, in exchange for cryptocurrency. The cash is then secretly sent to criminals or sanctioned individuals in other countries.
According to the NCA, individuals “associated with” the Russian Intelligence Services attempted to use Smart to provide funding to the Bulgarian spies in summer 2023, after police had arrested most of the members of the ring. Marsalek was established in Moscow at the time. The agency did not provide more detail on the attempt.
The scheme has been used by everyone from oligarchs to the Kinahan cartel, the Irish cocaine traffickers linked to numerous contract killings, according to the NCA.
“We are tying drugs trades in our community all the way through to the highest levels of organised crime, geopolitics, sanctions evasion, the Russian industrial military complex and state-linked activity,” said Sal Melki, NCA deputy director for economic crime.
Melki added: “So we can really draw a really clear thread between somebody buying some cocaine on a Friday night all the way through to geopolitical events that are causing suffering across the world.”
Smart is run by Ekaterina Zhdanova, a Russian national who has appeared on the covers of business magazines in Russia and was put under sanctions by the US in 2023. Zhdanova is in custody in France. The head of TGR is George Rossi, a Ukrainian national born in Russia who is also under US sanctions.
Marsalek, former chief operating officer of Wirecard, fled to Moscow after the payments company collapsed in a €1.9bn fraud scandal in June 2020.
He has acted as a freelance intelligence contractor for Russia’s spy agencies, and tasked the Bulgarian spy ring with a range of surveillance and sabotage operations across Europe.
While Marsalek is subject to an Interpol Red Notice for his role in the Wirecard fraud, he was not charged with espionage by the UK authorities.
The NCA’s investigation into the money laundering networks is known as Operation Destabilise. The UK has made 128 arrests and seized more than £25mn in cash and cryptocurrency.
The investigation has highlighted the Russian state’s willingness to work with organised crime gangs to counter western sanctions after Moscow’s full-scale invasion of Ukraine in 2022.
The NCA has tried to deter people from working for the networks with posters, written in both Russian and English, pinned to the bathroom walls of motorway service stations across the UK.
Brussels set to issue formal warning to Italy over ‘golden power’ rules
European Commission believes Rome’s regulations enabling it to scrutinise foreign takeovers may breach EU law
Brussels is set to issue a formal warning to Rome over concerns that Italy’s far-reaching “golden power” rules may breach EU law, two European officials have said.
The European Commission has been critical of Italy’s use of the golden power rules, which were originally introduced in order to vet foreign takeovers of strategic Italian assets and give Rome the right to impose requirements on transactions considered to involve national security.
On Friday, Brussels was poised to issue a “letter of notice” to Italy, which marks the formal start of an infringement procedure under which Rome will be accused of potentially breaching EU law, the European officials said.
Through such a letter, Brussels requests information from Italy, after which Rome must send a detailed reply. The European Commission declined to comment.
The golden power rules, which give Rome the right to potentially block foreign acquisitions of Italian assets, were originally introduced in 2012 and only applied to companies in critical sectors such as defence, energy, transport and communications.
But Italy subsequently increased the sectors coming within the scope of the rules to include banking, health and water.
Italian Prime Minister Giorgia Meloni’s government used the golden power rules for the first time in May to impose conditions on a proposed domestic deal: UniCredit’s takeover bid for smaller rival Banco BPM.
Analysts said the rules, initially devised as a defensive measure against a sharp influx of Chinese investment into Italy, had turned into a government tool for managing significant national assets.
The Italian government’s intervention in UniCredit’s bid for Banco BPM came amid the European Commission’s push to encourage EU banking industry consolidation to boost the bloc’s ailing economy.
Brussels is increasingly frustrated with hostile reactions from EU member states to consolidation as it views a network of fewer, bigger banks as essential to creating globally competitive financial services companies that can take on US rivals.
In July, the commission sent a private letter to the Italian government that said Brussels had reached a preliminary conclusion that Rome breached EU merger law through its use of the golden power rules in UniCredit’s bid for Banco BPM.
UniCredit ultimately withdrew its offer for Banco BPM following the government’s imposition of several conditions on the proposed deal.
The formal warning by the commission comes amid ongoing discussions with Rome in an effort by Brussels to try to persuade Italy to change its golden power rules.
European officials have described those conversations as constructive and said the discussions are set to continue.
French telcos explore wider bid for billionaire Drahi’s assets
Orange, Bouygues and Free consider new proposal for multiple Altice assets after €17bn bid for SFR was rejected
French telecoms groups Orange, Bouygues and Iliad-owned Free are exploring a fresh multibillion-euro offer to buy rival SFR that would also encompass other assets from Patrick Drahi’s Altice France empire, as they step up efforts to bring the tycoon to the negotiating table.
The three operators, which had a €17bn joint bid for the bulk of SFR’s operations rejected in October, are exploring an expanded bid in an effort to simplify any sale process for Drahi, according to three people familiar with the matter.
As well as SFR, Altice France also owns operations in the French overseas territories and holds stakes in outsourcing operation Intelcia, data centre business UltraEdge and broadband network XpFibre.
Orange, Bouygues and Free said their offer for SFR last month, which was swiftly rejected by Altice France, corresponded to an enterprise value of €21bn for the entire company.
The people emphasised that the consortium was also considering other options — including a renewed effort to acquire SFR alone.
The potential sale of SFR, Altice’s flagship brand, comes as Drahi looks to dismantle a communications empire he built through a debt-fuelled deal spree, piling about $60bn in debt at its peak across the group.
As interest rates have risen, the French-Israeli billionaire has been forced to restructure Altice’s debts and sell assets. The hope among the bidders for SFR is that a deal to take several assets off Drahi’s hands in a single transaction would simplify this process.
But a disposal of SFR, which would reduce the number of operators in France’s telecoms market from four to three, is likely to face intense regulatory scrutiny.
Under the terms of the initial offer the three bidders would have carved up SFR’s consumer business between them, with Bouygues and Free sharing the B2B unit. Altice felt the offer undervalued SFR.
Two of the people said the consortium is trying to strike a deal ahead of spring next year, when Orange is expected to close its €4.25bn acquisition of the other 50 per cent of its Spanish subsidiary MasOrange. That deal could result in intensified regulatory scrutiny of an SFR buyout.
Under EU rules, the automatic trigger for Brussels to review a merger is not met if each of the parties involved derives more than two-thirds of its EU-wide turnover from one member state. The buyout of MasOrange will result in Orange — which currently makes about two-thirds of its revenues in France — falling below that threshold.
The consortium believes French regulators may look more favourably on a deal than their counterparts in Brussels, according to people familiar with their thinking.
However, New Street Research analyst Russell Waller said that either way Brussels “will probably want to have a say” on a deal of “such significance”.
The bidders believe that ongoing customer losses at SFR — which totalled 99,000 in mobile and 19,000 in broadband between April and June this year — will lower the value of the asset over time, according to people familiar with their thinking.
Drahi is simultaneously running separate sale processes for several Altice France assets, including SFR’s business division, its broadband network infrastructure and XpFibre.
Altice has received a bid of about €1bn for the B2B unit from Altitude, a business services provider, according to two people with knowledge of the situation.
Following a recent restructuring of Altice France’s €24bn debt pile, which saw creditors take a 45 per cent stake in the group, Drahi must gain approval from an independent director on any asset sale of more than €3bn.
The company’s creditors may block any independent bid for Altice’s B2B unit in the hope that the consortium makes a new approach, according to a person familiar with their thinking.
Altice France, Iliad and Orange declined to comment. Bouygues did not respond to a request for comment.
Closing Market Summary: Intraday reversal underscores fading AI momentum despite strong NVIDIA beat
The stock market had a tumultuous day as equities faced a sharp intraday reversal, which wiped out the early gains that followed NVIDIA's (NVDA 180.64, -5.88, -3.15%) stellar earnings report.
Investors eagerly anticipated results from the world's largest company as the AI trade's momentum has stalled as of late. NVIDIA delivered on the hype, cruising past earnings expectations and delivering robust Q4 guidance.
The S&P 500 (-1.6%), Nasdaq Composite (-2.2%), and DJIA (-0.8%) held gains wider than 1.0%, pushing them back above their 50-day moving averages, which had been violated earlier in the week.
The PHLX Semiconductor Index (-4.8%) and Vanguard Mega Cap Growth ETF (-2.0%) were both up around 3.0% as NVIDIA's gain widened to nearly 5.0%. All eleven S&P 500 sectors traded higher as the broader market rallied with strong leadership from the market's largest names.
Stocks hit a peak just before 11:00 ET, before a relatively sharp sell-off ensued. Some profit-taking was to be expected with such a large swing across the mega-caps, but the retreat broadened to nearly every corner of the market.
The information technology sector (-2.7%) was hit the hardest, charting session lows through the close as the sector nearly inversed its early gain. Micron (MU 201.37, -24.55, -10.87%) and Advanced Micro Devices (AMD 206.02, -17.53, -7.84%) were among the names (along with NVIDIA) to push the PHLX Semiconductor Index 4.8% lower, while Oracle (ORCL 210.69, -14.84, -6.58%) and Palantir Technologies (PLTR 155.74, -9.68, -5.85%) also faced outsized losses.
The industrials (-1.7%), consumer discretionary (-1.7%), materials (-1.6%), and communication services (-1.1%) sectors also faced considerable losses.
Only the consumer staples sector (+1.1%) closed with a gain today. The sector was boosted from the open by Walmart (WMT 107.11, +6.50, +6.46%) after a solid beat-and-raise earnings report, while the defensive nature of the sector kept it largely resilient to the broader market pullback.
Outside of the S&P 500, the Russell 2000 (-1.9%) and S&P Mid Cap 400 (-1.6%) faced losses similar to that of their larger-cap counterparts.
Today's batch of economic data painted a mixed picture of the labor market. The September Employment Report saw a 119,000 increase in payrolls, but also included a downward revision to -4,000 for August. There was also an uptick in the unemployment rate to 4.4% from 4.3%, so the overall report was not as strong as the headline reading suggested. This will be the final jobs report ahead of the December FOMC meeting since the Bureau of Labor Statistics will not release the November report until December 16.
All told, today's data facilitated a modest increase in expectations for a December rate cut, though it still remains an unlikely occurrence. The CME FedWatch tool now assigns a 39.6% probability to a 25-basis point rate cut at the December FOMC meeting, up from 30.1% yesterday.
Today's trade ultimately gives credence to concerns that the most recent run to record highs was too reliant on mega-cap leadership and the promise of an additional easing from the Fed. NVIDIA's inability to sustain gains after a blowout earnings report shows that the market's sentiment around the AI trade is still skewed to the downside, keeping the major averages from holding above the critical 50-day moving average level.
U.S. Treasuries climbed on Thursday, recovering their slim midweek losses. The 2-year note yield settled down four basis points to 3.56%, and the 10-year note yield settled down three basis points to 4.11%.
- Nasdaq Composite: +14.3% YTD
- S&P 500: +11.2% YTD
- DJIA: +7.5% YTD
- Russell 2000: +3.4% YTD
- S&P Mid Cap 400: -0.4% YTD
Reviewing today's data:
- The September employment report, which is certainly a lagging indicator this time, suggested the labor market was not falling apart in September. In fact, nonfarm payroll gains accelerated to 119,000 after declining by 4,000 in August.
- This wasn't an abjectly strong report, nor was it an abjectly weak report. We wouldn't call it "just right" either, not with the uptick in the unemployment rate and the stalling out of average weekly hours worked, but the key takeaway is that this report wouldn't be enough to convince the more hawkish-minded Fed officials to cut rates in December.
- Initial jobless claims for the week ending November 15 decreased by 8,000 to a lowly 220,000. Continuing jobless claims for the week ending November 8 increased by 28,000 to a not-so-lowly 1.974 million, which is the highest since November 6, 2021.
- The key takeaway from the report is that it corroborates the low firing, low hiring narrative hanging over the labor market.
- Existing home sales increased 1.2% month-over-month in October to a seasonally adjusted annual rate of 4.10 million (consensus 4.08 million) from a downwardly revised 4.05 million (from 4.06 million) in September. Sales were up 1.7% on a year-over-year basis.
- The key takeaway from the report is that home sales in October were aided by lower mortgage rates, yet limited inventory in some regions, combined with high prices in others, got in the way of stronger selling activity.
- November Philadelphia Fed Index -1.7 vs. 2.0 Briefing.com consensus; prior -12.8