Following a significant market rally spurred by the decisive presidential election, stock futures saw a slight gain. Bitcoin, the U.S. dollar, and bank stocks all surged in Wednesday’s post-election trading. Conversely, several international funds and solar stocks faced declines as investors anticipated negative impacts from the President-elect’s policies. On Thursday, market participants are keenly awaiting the Federal Reserve’s interest rate decision and Chair Jerome Powell’s press conference. Additionally, quarterly earnings reports are expected from Moderna and Warner Bros. Discovery before the market opens, with Block, Pinterest, and Rivian set to report in the afternoon.

European markets saw an uptick on Thursday morning, buoyed by investor anticipation of rate cuts from both the U.S. Federal Reserve and the Bank of England. The trading session was marked by a flurry of earnings reports from major European companies. Among the notable movements, Adyen’s shares plummeted by 10%, making it the day’s worst performer. In contrast, GN Store Nord, a Danish manufacturer, emerged as the top performer, with its shares surging over 10% following the release of its latest financial results.

Asia-Pacific markets experienced a mixed trading session on Thursday, with most indices showing gains despite some volatility. The yen, which had weakened to an intraday low of 154.7 against the dollar on Wednesday, reached its weakest point since July 30, rebounding slightly to 153.81 on Thursday. Leading the gains in the region, China’s CSI 300 index surged by 3.02%, while Japan’s Nikkei 225 was the only major index to close in the red, falling by 0.43%. In other news, Chinese state media reported that the National People’s Congress Standing Committee had reviewed a plan to increase local government debt, following initial discussions earlier in the week.

Economic Calendar

Earnings Calendar

Notable reports for Thursday before the bell include ACIW, ACMR, GOLF, APD, AGI, AQN, ALMS, COLD, APPN, MT, ATS, BCE, BDX, BSY, BRY, BIGC, CCJ, GOOS, CG, CARS, CEVA, CGON, YOU, CCOI, COMM, DDOG, XRAY, DNOW, DCO, DUK, DT, EPC, EDR, EPAM, EVRG, RACE, AG, FWRG, GERN, GDRX, HAE, HAIN, HAL, HBI, HSY, HGV, INBX, IBP, INSW, ORWD, KELYA, KVUE, KRP, DNUT, CLII, LFST, LGND, LSPD, MTSI, MFC, MRX, MDU, MPW, MRNA, TAP, ML, MUR, NABL, VYX, NXST, NVMI, OLPX, OSCR, PZZA, PENN, PCG, PLNT, PBH, PRMW, PRVA, RL, ROK, RXO, SCSC, SEE, STGW, SHOO, STRA, TBLA, TPR, TRP, TGLS, TGNA, TU, TPX, THR, THRY, TDG, TPB, UAA, PRKS, USFD, VCEL, VTRS, VITL, WD, WRBY, WBD, KLG, WWW, XPEL, & YETI.

After the bell reports include DKNG, ATEN, AAON, ACVA, ADPT, ADMA, AFRM, AGL, AL, ABNB, AKAM, ALRM, ALLO, AMRC, AMN, AMPL, AAOI, ALTM, ANET, ARLO, ARRY, ASTH, AVPT, AXON, BILL, BLNK, SQ, BE, BHF, CABO, CPRG, CPK, CIVI, CLFD, NET, COLL, CPAY, CYRX, DH, DRH, DIOD, DOCS, DBX, DXC, ENV, EOG, ESTA, EVH, EXPI, EXPE, FIGS, FIVN, FLYW, FTNT, FNKO, G, GETY, SPRO, GDOT, HRB, INDI, INGN, PODD, JAMF, FROG, KTOS, KURA, LGF.A, LITE, MGNI, MRVI, MLNK, MTUS, MTD, MNST, MSI, MP, MYGN, NWSA, LASR, NUS, NVEE, OLO, OS, LPRO, OPEN, OPK, OEC, OVV, PACB, PEB, PINS, PBI, PRA, PTCT, QDEL, RRR, RDFN, REZI, RNG, RIVN, RXST, SVV, SOLV, SPT, STEP, RUN, SG, SYNA, TEM, TTD, TOST, U, UPST, VCTR, WTI, WEST, WPM, XPOF, & ZD.

News & Technicals’

Moderna reported a surprising profit for the third quarter on Thursday, significantly exceeding Wall Street expectations. This positive outcome was driven by effective cost-cutting measures and higher-than-anticipated sales of its Covid vaccine. The company highlighted that its latest Covid vaccine benefited from receiving U.S. approval three weeks earlier than the previous version did in 2023. Additionally, this quarter marked the first time sales of Moderna’s vaccine against respiratory syncytial virus (RSV) were included, representing the company’s second commercially available product.

As the Federal Reserve concludes its meeting on Thursday, it is expected to implement another interest rate cut. Market participants will be keenly focused on Chair Jerome Powell’s remarks regarding future monetary policy directions. Historically, Fed policymakers have aimed to remain apolitical, so Powell is likely to steer clear of making direct comments about the anticipated policies of President-elect Donald Trump. Instead, his focus will likely be on the economic outlook and the Fed’s strategy moving forward.

Qualcomm announced impressive fourth-quarter earnings on Wednesday, surpassing Wall Street’s expectations for both earnings and revenue. The company also provided a strong outlook for the December quarter, which contributed to a surge in its stock during extended trading. Additionally, Qualcomm’s board approved a substantial $15 billion in additional share repurchases, signaling confidence in the company’s future performance and commitment to returning value to shareholders.

After yesterday’s significant market rally the question will be follow-through?  We have a big day of earnings and economic reports including a trade decision from the FOMC.  Though premarket activity suggests another gap up open be watchful for any clues of profit taking that could pull the market back with big point moves.  That said, it is also possible that the election celebration continues through the end of the week so just be prepared to protect your profits. 

Trade Wisely,

Doug

Following Donald Trump’s victory in the 2024 presidential election, stocks are set for a significant rally on Wednesday. Bitcoin surged to an all-time high of $75,000, likely to benefit from expectations of relaxed regulations. The dollar index reached its highest level since July, and the 10-year Treasury yield rose to approximately 4.43%. Bank shares experienced a notable boost, with JPMorgan, Bank of America, and Wells Fargo, each jumping by at least 6%. Additionally, futures for the small-cap benchmark Russell 2000 increased by 6%.

European stocks continued their upward trajectory, with the pan-European Stoxx 600 rising by 1.2%. This broad-based increase saw most regional bourses and sectors gaining, with media stocks leading the charge by adding 2.6%. However, the automotive sector faced challenges, declining by 2%. Among individual companies, Commerzbank reported a 6.2% drop in net profit to 642 million euros for the third quarter, attributed to a broader decline in net interest income and increased risk provisions.

Asia-Pacific markets presented a mixed performance. Japan’s Nikkei 225 led the gains, surging by 2.61%, buoyed by the Bank of Japan’s September monetary policy meeting minutes, which revealed a consensus among members to raise rates. Conversely, South Korea’s Kospi fell by 0.52%, and Hong Kong’s Hang Seng index dropped significantly by 2.5%. Australia’s S&P/ASX 200 also saw a decline, closing 0.83%. Meanwhile, investors are closely monitoring the ongoing five-day meeting of China’s National People’s Congress for potential announcements on additional economic stimulus measures.

Economic Calendar

Earnings Calendar

Notable reports for Friday before the bell include AEP, FOLD, ASC, ASTE, ATHM, AVDX, AAVA, BCO, BIP, CLBT, CELH, COR, CTRI, GIB, CRL, CLVT, CNDT, CURB, CVS, DK, DIN, ENLT, ENVO, HLNE, HWM, IONS, IRM, JCI, JLL, KMT, KRNT, LNTH, LINE, LXP, MAC, MKTX, MCFT, EYE, ODP, OC, PFGC, PERI, PRGO, PNW, SNDR, SMG, SRE, SFL, SHOP, SMRT, SWX, STWD, SUN, SGHC, TEVA, TRMB, VERX, & VSH.

After the bell reports include ARM, ACAD, ADTN, ALB, AMC, AWR, ANSS, APA, RUCS, ASH, ASPN, ATO, BTG, BALY, BBDC, BBSI, BYND, BKH, BMBL, CDRE, CDLX, CERT, CHRD, CLNE, CWAN, CDE, COHR, CXW, CRSR, CTVA, COTY, CXT, CCRN, LAW, CSGS, CYTK, CLX, APPS, DV, DUOL, BROX, ELF, ECPG, ET, ENS, ENLC, EQX, EVTC, EOLS, FICO, FSLY, FNF, FBIN, GNK, GFL, GILD, LOPE, GH, HCAT, HL, HST, HUBS, IIPR, IONQ, JXN, JAZZ, HOBY, KNTK, KVYO, KGS, KD, LB, LZ, RAMP, LYFT, MRO, VAC, MTCH, MCK, MELI, HEOH, MKSI, MODV, MWA, NFG, NMIH, NTR, OSUR, ORA, PCRX, PYCR, PR, PLYA, POWA, POWI, PRI, PTC, QTWO, QGEN, QCOM, RDN, DPD, RYN, PLSY, RNR, RVMD, RLJ, RGLD, SRPT, SBGI, SITM, STR, SEDG, STE, SUI, TTWO, TNDM, SKT, TS, TKO, COOK, TRIP, TPC, UPWK, VECO, VCYT, VSTO, VTLE, WAY, WES, WMB, WOLF, WK, XHR, ZG, & ZIP.

News & Technicals’

CVS Health reported mixed results for the third quarter, with higher medical costs impacting its profitability. The company anticipates that these elevated costs will continue to pressure its performance throughout the year, leading them to withhold a formal outlook at this time. This earnings report marks the first under the leadership of CEO David Joyner. Additionally, CVS announced the appointment of Steve Nelson, former CEO of UnitedHealth Group, as the new president of its health insurer, Aetna, effective immediately.

Super Micro, the embattled server maker, reported a sharp 17% decline in its preliminary first-quarter results on Tuesday. The company is grappling with several corporate governance challenges, including the recent resignation of its auditor. Despite these issues, the board of directors stated that there was no evidence of fraud or misconduct by management. This statement comes as the company seeks to reassure stakeholders amid ongoing scrutiny.

Solar stocks are experiencing a sell-off as clean energy investors react to the news of Donald Trump’s upcoming second term as President. Concerns are mounting among traders that Trump might repeal the Inflation Reduction Act if Republicans gain unified control of the government. This uncertainty has led to a significant drop in the Invesco Solar ETF, which was down by 7% in premarket trading.

The world’s largest automaker by sales volume reported a 20% year-on-year decline in operating profit. Despite this drop, the company upheld its full-year operating profit forecast of 4.3 trillion yen. In a positive move for shareholders, Toyota increased its full-year dividend forecast to 90 yen, up from 75 yen the previous year.

Although the stocks are set for a significant rally, I would be very cautious about rushing in chasing the exuberant moves.  The T2122 indictor will likely show a very overbought condition first thing this morning so watch for the possibility of some profit taking or a substantial whipsaw.  Soon markets will remember we have and pending FOMC decision Thursday afternoon and choppy price action could resume. The dollar and bond yields are zooming higher in speculation of policy changes so be very careful with commodities.

Trade Wisely,

Doug

Stock futures edged higher on Monday as investors with all eyes on the presidential election and the potential volatility it may bring. Nvidia shares climbed 2% in premarket trading following the announcement by S&P Dow Jones Indices that the chipmaker would replace Intel in the 30-stock Dow. Meanwhile, Wall Street is on edge ahead of the Federal Reserve’s latest rate decision, expected on Thursday, with traders pricing in a 96% chance of a rate cut.

European markets saw an uptick on Monday following a sluggish start. Sectors such as oil and gas, autos, and banks each gained approximately 0.7%, while tech stocks experienced a slight decline of 0.2%. The rise in crude oil prices by over 2% provided a boost to oil stocks. Burberry’s shares surged by around 5% after reports emerged that Moncler might be considering a bid for the British luxury brand. Meanwhile, investors are keenly watching developments related to the upcoming U.S. presidential election.

Asia-Pacific markets experienced a positive trend as investors geared up for a busy week ahead. South Korea’s blue-chip Kospi led the gains with a 1.83% rise, while Hong Kong’s Hang Seng index saw a modest increase of 0.27%. Australia’s S&P/ASX 200 closed 0.56%, and the Taiwan Weighted Index advanced by 0.81%. Notably, Japan’s markets were closed for a holiday. Investors are also closely watching Australia, where the central bank is expected to announce its interest rate decision on Tuesday, with the Reserve Bank of Australia likely to maintain the official cash rate at 4.35%.

Economic Calendar

Earnings Calendar

Notable reports for Friday before the bell include AMG, BCRX, BNTX, CC, CHH, CAN, CEG, DOCN, ENTG, FIS, FOXA, BEN, FRPT, FTDR, IART, KNF, KRYS, MAR, MSSC, NYT, OMI, PEG, RVTY, TPG, TRS, TGI, YUMC, & ZTS.

After the bell reports include EGHT, ADUS, AOSL, ATUS, AIG, ANDE, AHH, AZAB, AVB, BCC, BFAM, BWXT, CDNA, CE, CRUX, CLF, CRBG, CWK, FANG, DEI, ELME, EQH, WTRG, EVER, ES,, FN, FWRD, GKOS, GT, GXO, HPK, HIMS, HOLX, HMN, HHH, HUN, ICHR, ILMN, INSP, INTA, LSCC, MQ, MTG, NVTS, NXPI, OGS, OTTR, PLMR, PLTR, PRAA, PRIM, QNST, O, RRX, RHP, SANM, ST, SLAB, SLF, TDC, BWIN, TBI, VVX, VRTX, VNOM, VNO, VOYA, WOW, & WYNN.

News & Technicals’

Berkshire Hathaway’s cash reserves surged to a record $325.2 billion by the end of September, up from $276.9 billion in the second quarter, as revealed in its recent earnings report. Despite this increase, the company did not repurchase any shares during this period, continuing a trend of reduced buyback activity seen earlier in the year. This slowdown in repurchases coincided with Berkshire shares outperforming the broader market and reaching record highs. In the second quarter, Berkshire had repurchased only $345 million worth of stock, a significant drop from the $2 billion bought back in each of the previous two quarters. The company maintains that it will repurchase shares when Chairman Warren Buffett believes the price is below Berkshire’s intrinsic value, conservatively determined.

Nvidia shares rose by 2% in premarket trading after S&P Dow Jones Indices announced late Friday that the chipmaker would replace Intel in the 30-stock Dow, effective at the end of the week. This change reflects Nvidia’s impressive performance, with its stock up 173% year to date, driven by its strong position in the artificial intelligence sector. In contrast, Intel has struggled, losing more than half of its value over the same period as it falls behind in the AI race.

Tuesday’s election results could significantly influence the stock market’s performance for the remainder of the year. According to the latest NBC News poll, the race between former President Donald Trump and Vice President Kamala Harris is “deadlocked.” However, the market’s reaction may depend more on which party gains control of Congress. A divided control of the U.S. House of Representatives and Senate would likely maintain the status quo. In contrast, a sweep by either Republicans or Democrats, likely accompanied by a White House victory for the same party, could lead to new spending initiatives or a tax overhaul.

The bulls are trying to put on brave faces this morning but all eyes on the presidential election and the uncertainty that can create we could easily see very choppy light volume price action.  We should also plan carefully the risk of election day when we have in the past seen some very big price swings setting up market gaps and reversals overnight.  Besides that we have a busy week of earnings and an FOMC decision coming Thursday afternoon.

Trade Wisely,

Doug

Buoyed by robust earnings from Alphabet, traders are gearing up for more reports from major tech companies and a crucial update on U.S. economic growth. Meta Platforms and Microsoft are set to release their earnings on Wednesday, followed by Apple and Amazon on Thursday. Investors are also keenly awaiting the preliminary reading of the gross domestic product (GDP), expected to reveal a 3.1% annualized growth rate for the third quarter, according to the Dow Jones consensus forecast. This anticipation is driving significant market activity as stakeholders assess the broader economic landscape.

European markets saw a decline as investors evaluated a new wave of corporate earnings and regional growth data, while also anticipating the upcoming U.K. government budget announcement. The day was marked by a flurry of earnings reports and business updates from numerous companies. Despite the market downturn, the euro zone economy showed resilience, recording a 0.4% growth in the third quarter of 2024.

Asia-Pacific markets experienced a mixed performance as traders digested consumer price data from Australia, which showed a 2.8% year-on-year increase in headline inflation for the September quarter. Amidst this backdrop, China is contemplating the approval of over 10 trillion yuan in additional debt next week to boost its economy. The market reactions were varied: Australia’s S&P/ASX 200 declined by 0.83%, Hong Kong’s Hang Seng index dropped by 1.65%, and South Korea’s Kospi fell by 0.92%. In contrast, Japan’s Nikkei 225 bucked the trend, rising by 0.96%.

Economic Calendar

Earnings Calendar

Notable reports for Wednesday before the bell include ABBV, AER, AFCG, ALE, ARVN, ADP, AVNS, AVT, AXTA, BLCO, BHC, BIIB, BLKB, EAT, BG, CAT, CDW, CHEF, CLH, CWEN, CMCO, CURB, DAN, LLY, EXC, EXTR, FVRR, FLEX, FTV, GRMN, GTES, GEHC, THRM, ROCK, GSK, GPN, GPI, HR, HES, HESM, HUM, ITW, IMAX, INMD, ITCI, JKS, KEX, KHC, DRS, LIVN, MLM, MTRN, MNRO, NAVI, NBIX, NI, NVCR, OIS, OMCL, OMF, OSW, OPCH, OSK, OTIS, PSN, PUMP, REYN, SHAK, SLGN, SITE, SCL, TEX, COCO, TW, TT, TTMI, UTHR, VRSK, VMC, WING, XPO, & ZBH.

After the bell reports include ACHC, AEIS, AFL, AIN, ALKT, ALGT, ALL, ATEC, ALTR, AWK, AMGN, AM, AR, ACGL, ACA, AXS, AX, BECN, BHE, BIO, BKNG, CHRW, WHD, CVNA, CWST, CF, CLX, CGNX, CTSH, COIN, COLM, CODI, CRK, CFLT, CNMD, CORT, CACC, DWST, STOS, DASH, EBAY, EIG, ERII, NVST, EPR, EQIX, EQR, ETD, ETSY, EG, FRT, FND, FORM, FCPT, FTAI, GEN, GDDY, GRBK, THG, HLF, HTGC, HLI, HUBG, IRT, INFA, INVH, IRTC, KLAC, LMND, LPLA, MGY, MTW, MATX, MAX, MET, META, MGM, MSFT, MSTR, MAA, MCW, MPWR, MUSA, MYRG, NSA, NTGR, NMFC, NXT, NVEE, OIH, PGRE, PAYC, PCTY, PEN, PPC, PSMT, PCOR, PRU, PSMT, RELY, RIOT, HOOD, ROKU, ROOT, RUSHA, RSI, RYAN, SIMO, SNBR, SFM, SPXC, STAA, SBUX, STEM, RGR, SUM, NOVA, TNK, TDOC, TENB, TRUP, TWLO, UDR, OLED, VTR, HCC, WTS, & WSC.

News & Technicals’

The euro area economy expanded by 0.4% in the third quarter, surpassing the anticipated 0.2% growth. Spain and Ireland led the way with the highest growth rates, while Germany, Europe’s largest economy, managed to avoid a recession. These positive readings come as the European Central Bank is expected to implement four interest rate cuts this year, aiming to further stimulate economic activity across the region.

Advanced Micro Devices (AMD) reported its third-quarter results on Tuesday, meeting earnings forecasts and slightly surpassing revenue expectations. The company highlighted a significant achievement in its data center business, which saw sales double for the second consecutive quarter. Despite this impressive growth, AMD’s overall revenue guidance for the fourth quarter remains aligned with consensus expectations, indicating steady performance in the upcoming period.

Volkswagen reported a decline in operating profit to 2.86 billion euros ($3.1 billion) for the third quarter, with sales revenues slipping 0.5% year-on-year to approximately 78.5 billion euros. These results follow the company’s decision last month to cut its 2024 annual outlook for the second time in a few months. Volkswagen has faced significant challenges recently, including warnings of potential plant closures in Germany and the cancellation of several labor agreements with local workers in September.

In a Tuesday interview with CNBC’s Jim Cramer, Pfizer CEO Albert Bourla expressed a positive outlook regarding activist investor Starboard Value, acknowledging some of its criticisms while affirming that the company is on a promising path. Bourla emphasized Pfizer’s openness to good ideas from Starboard or any other source, highlighting the company’s ongoing changes. On the financial front, Pfizer reported an earnings beat and raised its full-year outlook, driven by strong sales of its Covid vaccine and antiviral pill, Paxlovid.

With the market gearing up for more reports from the tech giants META and MSFT after the bell today traders will also need to digest GDP and ADP jobs data along with a huge slate of earnings. Bond yields have moderated slightly but the dollar is still amazingly strong and precious metals rising at the same time continue to show the overall uncertainty in the market.  Expect considerable price volatility and watch for the possibility of big morning gaps with all the earnings results coming after the bell today.

Trade Wisely,

Doug

U.S stock futures remained relatively unchanged as investors prepared for significant corporate earnings releases, particularly from prominent tech companies. The market seemed to react positively to a decline in oil prices, which followed weekend airstrikes by Israel on Iran that did not impact energy facilities. As the busiest week of the earnings season progresses, traders are closely monitoring reports from major firms. Pfizer and McDonald’s are set to release their results before the market opens, while Alphabet, Snap, Reddit, Chipotle, and Advanced Micro Devices will report after the closing bell.

European markets saw modest gains as investors processed the latest earnings reports. HSBC’s London-listed shares surged by 4.5% following a third-quarter earnings report that exceeded analyst expectations and the announcement of a $3 billion share repurchase plan. Conversely, shares of Novartis dropped by 3.5%, despite the pharmaceutical giant raising its full-year guidance after reporting increased third-quarter sales. This mixed performance highlights the varied investor reactions to corporate earnings and strategic announcements.

On Tuesday, Asia-Pacific markets experienced mixed movements, with most indices showing gains. Japan’s Nikkei 225 rose by 0.77%, despite the ruling Liberal Democratic Party losing its parliamentary majority, indicating investor confidence in the market’s resilience. South Korea’s Kospi managed to reverse earlier losses, ending the day up by 0.21%. Hong Kong’s Hang Seng Index also saw a modest increase of 0.35%. In contrast, China’s CSI 300 fell by 1%, reflecting some market challenges. Additionally, Japan’s jobless rate for September improved slightly to 2.4%, down from 2.5% in the previous month.

Economic Calendar

Earnings Calendar

Notable reports for Tuesday before the bell include AMT, AWI, ABG, ATI, CBZ, CECO, CHKP, CMCSA, CVLT, GLW, CTS, DHI, DTM, EXP, ECL, EPD, ESAB, FELE, ULCC, GPK, HEES, HRMY, HNI, HUBB, INCY, IPGP, ITT, JBI, JBLU, KNSA, LDOS, MAS, MCD, MSCI, NWBI, PYPL, PFE, PSX, PJT, RCL, STNG, SSTK, SOFI, SWK, SYY, THC, XRX, & ZBRA. After the bell reports include TXG, ATGE, AMD, ALHC, ALSN, GOOGL, AMH, APAM, BRMN, BXP, CZR, CAKE, CHE, CMG, CB, DVA, EIX, EA, ENVX, EQT, ESS, EXEL, EXE, EXR, FCF, FSLR, FE, FMC, HURN, IEX, NGVT, LSTR, LFUS, MTH, MIR, MOD, MDLZ, NRDS, OI, OKE, PK, PRQ, PFS, QRVO, RDDT, RSG, SAGE, SKWD, SNAP, STAG, SKY, UDMY, UMBF, UIS, UNM, VRNS, V, WPC, WERN, & ZWS.

News & Technicals’

Ford has adjusted its 2024 earnings forecast to the lower end of its previously announced range, now expecting an adjusted EBIT of approximately $10 billion, down from the initial range of $10 billion to $12 billion. Despite this adjustment, the automaker slightly exceeded Wall Street’s third-quarter expectations. The company’s third-quarter performance was driven by strong results from its “Pro” commercial and fleet business, along with solid contributions from its traditional operations, known as “Ford Blue.”

BP reported an underlying replacement cost profit of $2.3 billion for the July-September period, surpassing analyst expectations of $2.1 billion according to an LSEG-compiled consensus. Despite this, the British oil major’s third-quarter net profit of $2.3 billion was a decline from the $2.8 billion reported in the second quarter and the $3.3 billion in the third quarter of 2023. This marks BP’s weakest quarterly performance since the fourth quarter of 2020, a period when industry profits were severely impacted by the coronavirus pandemic.

Delta Airlines is seeking over $500 million in damages, along with litigation costs and punitive damages, following an IT outage linked to CrowdStrike’s security software. The outage caused Delta to cancel thousands of flights and struggle with recovery, lagging its competitors. Delta claims that flaws in CrowdStrike’s software affected its computers despite having disabled automatic updates. In response, CrowdStrike has filed its own suit, arguing that the issues were due to “Delta’s own negligence.”

Microsoft has accused Google of orchestrating “shadow campaigns” to undermine its reputation with European regulators. According to a blog post by a Microsoft lawyer, Google is allegedly leading a coalition of cloud companies to sway policymakers and mislead the public. This accusation comes in the wake of Google’s announcement that it plans to file an antitrust complaint against Microsoft with the European Union’s executive body, criticizing Microsoft’s software licensing practices. The escalating tensions highlight the ongoing rivalry between the two tech giants in the competitive cloud services market.

Anticipation is high as we wait for significant corporate earnings that will include reports from the tech giants over the next three trading days.  Expect significant price volatility that could create meaningful morning gaps in the index charts so plan your risk carefully. New record highs in the QQQ and SPY are very possible but if some earnings disappoint big declines are also possible as traders run for the door.  Be prepared as all this pent-up emotion spills out over the market.

Trade Wisely,

Doug

U.S. equity futures surged on Monday as investors anticipated a series of mega-cap earnings reports from technology companies, expected to propel the Nasdaq Composite to new highs. The weekend airstrikes by Israel against Iran, which did not target oil or nuclear facilities as initially feared, led to a decline in oil futures during early trading. Wall Street is gearing up for a significant week, marked by the busiest period of third-quarter earnings reports and the final stretch before the U.S. Presidential election on November 5. Notably, five of the “Magnificent Seven” companies—Alphabet, Microsoft, Meta Platforms, Amazon, and Apple—are set to release their third-quarter earnings this week.

European markets opened higher on Monday, with media and construction and materials stocks each gaining over 1%. However, oil and gas stocks declined by approximately 2.3%. Shares of Dutch medical devices giant Philips plummeted by 16.8% after the company revised its full-year sales outlook downward due to weak demand from China. Additionally, oil prices dropped by 6% on Monday following news that Iranian energy facilities were not damaged during an Israeli attack over the weekend.

On Monday, Japan’s benchmark Nikkei 225 and Topix indices saw gains, buoyed by a weaker yen amidst political uncertainty following the ruling LDP’s loss of its parliamentary majority. Meanwhile, China’s CSI 300 edged up by 0.2% to close at 3,964.16, despite the country reporting its worst industrial profit figures since the pandemic, with a significant 27.1% year-on-year decline in September. In other markets, Australia’s S&P/ASX 200 rose by 0.12%, South Korea’s Kospi increased by 1.13%, and Hong Kong’s Hang Seng index reversed earlier losses to finish 0.18% higher.

Economic Calendar

Earnings Calendar

Notable reports for Thursday before the bell include ACAD, BOH, CNP, HOPE, ON, PRCT, & SJW. After the bell reports include AGYS, AMKR, AESI, BOOT, BRX, BRO, CDNS, CALK, CWH, CSWC, CCCS, CDP, CR, CVI, PLOW, ESI, EHC, FFIV, FLS, F, HILT, NARI, FRC, LEG, LTC, NEW, PCH, RMBS, REG, SAFE, SBAC, SKY, TMDX, TREX, UFPI, UCTT, VFC, WM, & WELL.

News & Technicals’

Volkswagen is contemplating significant pay cuts, layoffs, and the closure or downsizing of its plants in Germany, according to the company’s works council. Management recently proposed a plan that includes a 10% across-the-board pay reduction and wage freezes for 2025 and 2026. The works council estimates that these measures will result in an overall pay cut of approximately 18% for workers over the period. Additionally, Volkswagen plans to shut down three factories and reduce the size of all other plants in Germany.

China’s industrial profits experienced their sharpest decline since the pandemic in September, according to data from the National Bureau of Statistics. Following a 17.8% drop in August, industrial profits plummeted by 27.1% year-on-year in September, marking the steepest fall since March 2020, which saw a 34.9% decrease. In response, Chinese authorities have intensified efforts in recent weeks to stimulate economic growth.

Shares of Japanese camera giant Olympus Corp dropped on Monday following the announcement of CEO Stefan Kaufmann’s resignation amid a drug allegation. Olympus disclosed that it had received an allegation that Kaufmann, a German national, had purchased illegal drugs. The company, in consultation with outside legal counsel, promptly investigated the matter, reported it to the authorities, and fully cooperated with their investigation.

Robinhood announced on Monday the launch of U.S. presidential election event contracts, allowing customers to trade based on their predictions for the closely contested race between Vice President Kamala Harris and former President Donald Trump. Event derivatives involve buying and selling contracts that let traders speculate on the outcomes of specific events, such as elections, economic data releases, or policy decisions, without owning the underlying assets. These derivatives, which are relatively new and generally considered high-risk compared to traditional financial instruments, have gained popularity in recent years.

The market looks to reverse Friday bearishness with huge anticipation of the mega-cap tech reports throughout the week ahead.  We are also seeming celebrating the Israel’s attack didn’t affect the oil infrastructure but strangely there seems to on concern about what Iran may do in response. Stay tuned as there may be more come on the geopolitical front.  Remember we have a big week of jobs data along with the earnings and those pesky bonds continue to march higher suggested a possible problem with this bull run. Plan carefully this week as price volatility could be wild!

Trade Wisely,

Doug

U.S. stocks are attempting to recover after a significant downturn, with the Dow experiencing its largest one-day loss since early December. Strong earnings from Tesla have provided a boost of confidence, encouraging bullish sentiment as SPY and QQQ aim for a premarket rebound. Meanwhile, the 10-year Treasury yield has been on an upward trajectory this week, surpassing the 4.25% mark during Wednesday’s session high. This increase in yields has exerted pressure on stocks recently, contributing to the market’s volatility.

Thursday, European stocks saw a modest rise, with most major bourses and sectors trading in positive territory. Renault’s shares surged over 7% following an unexpected increase in third-quarter revenue, showcasing the French carmaker’s resilience. Similarly, Barclays experienced a 4% boost in its share price after reporting better-than-expected third-quarter results, reflecting strong performance in the British banking sector.

Asia-Pacific markets experienced a general downturn. South Korea narrowly avoided a technical recession, with its third-quarter GDP growing by a modest 0.1% quarter-on-quarter. Despite this, South Korea’s benchmark Kospi fell by 0.72%. Australia’s S&P/ASX 200 also saw a slight decline of 0.12%. Hong Kong’s Hang Seng index dropped significantly by 1.35%, and mainland China’s CSI 300 experienced a larger loss of 1.12%. In contrast, Japan’s Nikkei 225 was the notable outlier, managing to reverse earlier losses and gain 0.1%.

Economic Calendar

Earnings Calendar

Notable reports for Thursday before the bell include ADT, ALKS, ALLE, AB, AAL, AIT, BHLB, BFH, BC, CRS, CARR, CBRE, COLB, DOV, DOW, DTE, EEFT, XPRO, FRME, FSV, FCN, HOG, HAS, HON, ITGR, KDP, KKR, LH, LEA, LTH, LNN, LKQ, MSM, NDAQ, NOC, OSIS, PPBI, POOL, RDUS, RS, RCI, RES, R, SPGI, SMPL, SAH, SBSI, LUV, FTI, TECK, TXT, TSCO, TPH, UNP, UPS, VLO, VLY, VIRT, VC, WNC, WST, & WEX. After the bell reports include ABCB, APPF, ART, AJG, ASB, BYON, SAM, BYD, COF, CSL, CINF, COUR, CUZ, DECK, DXCM, DLR, EW, EXPO, FHI, FFBC, FIBK, GLPI, GBCI, HIG, DOC, KNSL, KN, LHX, MGRC, MTX, NOV, OLN, PECO, PDM, PFG, RMD, SBCF, SKX, SPSC, SSNC, TXRH, TROX, UHS, VRSN, WDC, WY, & WSFS.

News & Technicals’

On September 13, Boeing machinists initiated a strike after decisively rejecting a labor proposal, with 64% voting against it. The proposal included substantial benefits such as 35% raises, a $7,000 ratification bonus, and increased 401(k) contributions. Resolving this strike has become a top priority for Boeing’s new CEO, Kelly Ortberg, as the company faces ongoing financial strain and is projected to continue burning cash through 2025. Ending the strike is crucial for stabilizing Boeing’s operations and financial outlook.

United Parcel Service (UPS) reported an increase in third-quarter profit on Thursday, driven by a rebound in volume ahead of the holiday season, which boosted revenue. Cost-cutting measures also helped mitigate the impact on margins from consumers opting for cheaper delivery options. Notably, the growth has been largely fueled by new e-commerce players, specifically China-linked bargain retailers Shein and Temu. This shift has intensified the move from premium air services to more affordable ground services, and further to the even lower-profit SurePost services, reflecting changing consumer preferences in the delivery market.

IBM’s software division saw strong performance, driven by accelerated growth in its Red Hat business. However, the company’s consulting and infrastructure units fell short of revenue expectations. Looking ahead, IBM anticipates that fourth-quarter revenue growth, at constant currency, will match the 2% growth seen in the third quarter. This outlook reflects a balanced perspective on the company’s varied business segments and their contributions to overall growth.

Hyundai Motor issued a warning on Thursday about slowing demand and increasing competition yet maintained its 2024 earnings target despite a 7% decline in third-quarter operating profit. This announcement led to a more than 5% drop in its share price. During a conference call, CFO Lee Seung-jo highlighted the deteriorating business environment for the automotive industry, pointing to rising policy uncertainties and global geopolitical risks as significant challenges.

SPY and QQQ are attempting to recover on the back of the TSLA earnings, however, the disappointing results from IBM are keeping the DIA rather subdued in the premarket.  That said, with a huge number of earnings reports today and some potential market moving economic reports anything is possible.  Bond yields continue to apply significant pressure to the market as gold continues to surge will keep investors on edge despite the hype the earnings season creates.

Trade Wisely,

Doug

Heading into Wednesday’s market open, U.S. stock futures traded lower, influenced by another increase in bonds yields raising interest rates. The benchmark 10-year Treasury note yield rose by 3 basis points to 4.23%, a level not seen since July. This rise is attributed to robust economic data and concerns over the deficit, despite a half-point rate cut by the Federal Reserve in September. Traders are increasingly worried that central bank policymakers might be less inclined to reduce rates in the near future.

European markets traded flat as investors concentrated on corporate earnings reports and U.S. Treasury yields. Despite Deutsche Bank surpassing profit expectations for the three months ending in September, its shares fell by 3%. In contrast, Roche’s shares increased by 0.7%, Heineken rose by 2.3%, Volvo Cars climbed by 1%, and Swedbank saw a significant rise of 6%. However, AkzoNobel’s shares dropped by

Asia-Pacific markets experienced a mixed performance. Tokyo Metro’s shares surged dramatically, soaring by as much as 47% during the day and closing 45% higher. However, Japan’s Nikkei 225 index fell by 0.8%. In contrast, South Korea’s Kospi climbed 1.12%, Australia’s S&P/ASX 200 edged up by 0.13%, and Hong Kong’s Hang Seng index increased by 1.33%. Meanwhile, Singapore’s core consumer price index, which excludes private transport and accommodation, rose by 2.8% in September compared to the previous year, surpassing the Reuters poll forecast of 2.7%. The overall consumer inflation in Singapore also rose by 2% year-on-year, slightly above the expected 1.9%.

Economic Calendar

Earnings Calendar

Notable reports for Wednesday before the bell include APH, T, AVY, BA, CME, KO, CSTM, EVR, GEV, GD, HCSG, HLT, KBR, LII, LAD, COOP, EDU, NEE, NEP, NTRS, ODFL, PRG, PB, ROP, SF, TMHC, TDY, TMO, TRU, TNL, UNF, UCB, VRT, WAB, WSO, & WGO. After the bell reports include ALGN AMP, ASGN, CACI, CP, CLS, CHDN, CYH, CLB, EGP, EQC, EPRT, GL, GSHD, GGG, GBX, IBM, ICLR, PI, KALU, KNX, LVS, LC, MAT, MXL, MC, MOH, MSA, MEN, ORLY, OII, CASH, PTEN, PEGA, QS, RJF, ROL, SLM, SEIC, NOW, SLP, SSB, STC, TMUS, TER, TSLA, TYL, URI, VLTO, VKTX, WCN, WSBC, WU, WHR, & WH.

News & Technicals’

McDonald’s shares fell by approximately 7% in after-hours trading on Tuesday following a CDC report linking an E. coli outbreak to the chain’s Quarter Pounder burgers. The outbreak has resulted in 10 hospitalizations and one death. Preliminary findings from the ongoing investigation suggest that the illnesses may be connected to slivered onions used in the Quarter Pounder. In response, McDonald’s has stated that it is taking “swift and decisive action” to address the outbreak in affected states.

Starbucks has released its preliminary results for the fiscal fourth quarter, revealing a continued decline in same-store sales for the third consecutive quarter, driven by a 10% drop in traffic to its North American stores. In response to these challenges, the company has suspended its outlook for fiscal 2025. To reassure investors and provide some stability, Starbucks has raised its quarterly dividend as part of its efforts to turn the business around.

Amazon is discontinuing its same-day delivery service, Amazon Today, which facilitated deliveries from mall and brick-and-mortar retailers. The company has halted any new development of the service and will begin winding it down. Selected retail partners can continue fulfilling orders through January 24, 2025. As part of this transition, a small number of employees will be laid off and provided with severance, while others will be reassigned to different positions within Amazon.

The International Monetary Fund (IMF) has issued a warning about the worsening state of China’s property market, which has led to a reduction in the country’s growth outlook. The IMF emphasized that the contraction in China’s property sector poses significant downside risks to the global economic outlook. Last week, China reported a third-quarter GDP growth of 4.6%, slightly above the 4.5% forecasted by economists polled by Reuters. However, in a report published on Tuesday, the IMF lowered its growth forecast for China to 4.8% for this year, down by 0.2 percentage points from its July projection.

The market will be trying to focus on earnings inspiration today with a huge increase in reports. However, another increase in bond yields could keep that excitement in check. The bad news in MCD and SBUX have created a nasty overnight whipsaw down so plan carefully as price volatility is likely to increase over the next several weeks as earnings numbers increase.

Trade Wisely,

Doug

U.S. stock futures edged up slightly on Thursday as investors awaited the release of initial weekly jobless claims data and September retail sales figures at 8:30 a.m. ET. These reports are expected to provide insights into the health of the labor market and consumer spending in the U.S. Additionally, corporate earnings reports are set to continue, with Travelers, Blackstone, and Elevance Health among the major companies reporting Thursday morning. Regional banks, including KeyCorp, M&T Bank, and Truist Financial, are also scheduled to release their earnings, adding to the day’s financial data.

European markets saw an uptick on Thursday morning as traders anticipated the upcoming monetary policy decision from the European Central Bank (ECB). The banking sector led the charge, with the banking index rising nearly 1.3%, while telecom stocks saw a slight decline of 0.5%. The ECB is expected to announce its third interest rate cut of the year, responding to inflation risks in the European Union that are diminishing more rapidly than anticipated. In September, inflation in the euro area cooled to 1.8%, falling below the ECB’s 2% target.

Most Asia-Pacific markets experienced a downturn on Thursday following a lackluster briefing from China’s housing ministry, which failed to meet investor expectations and led to a significant drop in the country’s property stocks. In Japan, exports declined by 1.7% in September compared to the same month last year, while import growth for the same period was 2.1%, falling short of forecasts. Meanwhile, Australia reported a slight decrease in its unemployment rate for September, which came in at 4.1%, marginally lower than the figure predicted by a Reuters poll.

Economic Calendar

Earnings Calendar

Notable reports for Wednesday before the bell include BMI, BX, CMC, ELV, HBAN, IIIN, IRDM, KEY, MTB, MAN, MMC, SNA, TCBI, TRV, TFC, WBS, & WNS. After the bell reports include NFLX, OZK, CCK, ISRG, FNB, WDFC, & WAL.

News & Technicals’

TSMC reported a net income of 325.3 billion Taiwanese dollars ($10.1 billion) for the July-September quarter, exceeding the LSEG estimate of 300.2 billion Taiwanese dollars. The company’s net revenue for the third quarter reached $23.5 billion, marking a 36% increase year-on-year. As the world’s largest producer of advanced chips, TSMC continues to serve major clients like Apple and Nvidia, highlighting its pivotal role in the global semiconductor industry.

Novavax announced that the Food and Drug Administration has placed a hold on its application for a combination shot targeting both Covid-19 and influenza, as well as a stand-alone flu vaccine. This decision, which caused a sharp decline in the company’s shares, stems from a single report of nerve damage in a patient who received the combination shot during a phase two trial completed in July last year. This development represents a setback for Novavax, which is urgently working to introduce new products to the market amid declining global demand for its Covid-19 vaccine.

Shares of Lucid Group declined during after-hours trading following the announcement of a public offering of nearly 262.5 million shares of its common stock. The electric vehicle startup plans to use the proceeds from this offering for general corporate purposes, which may include capital expenditures and working capital. This move aims to bolster the company’s financial position as it continues to expand its operations and market presence.

The Biden administration announced the forgiveness of an additional $4.5 billion in student debt, benefiting over 60,000 borrowers. This latest round of relief stems from the U.S. Department of Education’s improvements to the Public Service Loan Forgiveness program, which has faced challenges in the past. Eligible borrowers can expect to receive notifications about their cancelled debt in the coming weeks, marking a significant step in the administration’s ongoing efforts to address student loan burdens.

With a big round of earnings and economic reports that begin with initial weekly jobless claims, expect some price volatility with the T2122 indicator flashing an overbought warning.  We will also have to digest Retail Sales, Philly Fed Mfg., Industrial Production, Business Inventories, Housing Market Index, Natural Gas, Petroleum and more Fed talk from Goolsbee. So, buckle up it could be a wild and woolly day!

Trade Wisely,

Doug