The S&P 500 Index ($SPX) (SPY) is down -0.27%, the Dow Jones Industrial Average ($DOWI) (DIA) is down -0.26%, and the Nasdaq 100 Index ($IUXX) (QQQ) is down -1.20%. December E-mini S&P futures (ESZ26) are down -0.34%, and December E-mini Nasdaq futures (NQZ26) are down -1.27%.
US stocks are trading lower today as Alphabet slumped more than -12% on disappointing sales in its earnings report Wednesday afternoon. Also, Samsung (005930) slid nearly -4% in South Korean trading on disappointment about its quarterly earnings report, which was negative for US chip stocks since Samsung is one of the world’s largest chipmakers. In another disappointment, Caterpillar is down -7% after disappointing Q4 sales guidance. The markets are now looking ahead to today’s after-market earnings report from Amazon.com.
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Today’s US PCE deflator was exactly in line with market expectations. The Sep PCE price index rose +0.5% m/m and +3.6% y/y, while the Sep core price index rose +0.3% m/m and +3.1% y/y. The core PCE price index in September rose to +3.1% y/y from +3.0% in August and was just below May’s 2.5-year high of +3.2%. The core PCE price index has been consistently above the Fed’s +2% inflation target for the past five years.
Sep personal income rose +0.2% m/m, slightly below market expectations of +0.3% m/m. Sep personal spending rose +0.5% m/m, slightly below market expectations of +0.6%.
Weekly initial unemployment claims fell -1,000 to 194,000, showing a slightly stronger labor market than market expectations of 198,000. Weekly continuing unemployment claims fell to 1.701 million from a revised 1.722 million, showing a slightly stronger labor market than market expectations of 1.720 million.
US Q3 GDP (annualized q/q) rose to +3.4% from +2.2% in Q2 and was stronger than market expectations of +3.2%. Q3 personal consumption was unchanged at a strong +3.8%, stronger than market expectations of +3.4%.
The FOMC at its 2-day meeting that ended Wednesday left its federal funds rate target unchanged at 3.75-4.00%, as the market expected. The markets are now pricing in an 84% chance of a rate hike at the FOMC’s next meeting on December 8-9. The long end of the yield curve was steady to slightly higher after Wednesday’s FOMC results, while the shorter end of the yield curve fell, with the 2-year T-note yield on Wednesday falling -4 bp to 4.698%.
Dec WTI crude oil prices are down more than -2% today as the market assesses the status of mediation efforts to avert a possible US military attack on Iran after Tuesday’s US mid-term elections. The Wall Street Journal reported that US Vice President Vance has reached out to Mohsen Rezaee, secretary of Iran’s top security body, to see if there is any room for a temporary peace deal. Axios reported Wednesday that Qatar is leading behind-the-scenes mediation efforts, supported by Pakistan, Saudi Arabia, Egypt, and Türkiye.
The news of negotiations followed the Wall Street Journal’s report Tuesday that the US has told several Persian Gulf countries to be prepared for a short, intense military campaign against Iran. WSJ said President Trump hasn’t yet decided to proceed with the attack but is leaning toward an attack after next Tuesday’s mid-term elections.
Stocks are supported by the prospect of solid quarterly earnings. According to data compiled by Bloomberg Intelligence, Q3 S&P 500 earnings are expected to climb by +26% from a year earlier, up from a July estimate of 22%. As of Wednesday, 225 of the S&P 500 companies have reported results, with 80% beating estimates.
Overseas stock markets are mixed. The Euro Stoxx 50 is up +0.63%. China’s Shanghai Composite closed down -0.82%. Japan's Nikkei-225 Stock Average closed up +1.10%.
Interest Rates
December 10-year T-notes (ZNZ6) are up +15 ticks. The 10-year T-note yield is down -5.4 bp to 4.964%. T-notes are getting a boost from safe-haven demand amid today’s stock sell-off. T-note prices are also getting a boost from today’s sell-off in crude oil prices, along with today’s -2.3 bp decline in the 10-year breakeven inflation expectations rate to 2.360%.
T-note prices are seeing some downward pressure from today’s stronger-than-expected US GDP report and supply overhang, as the Treasury sells $44 billion of 7-year T-notes later today.
European government bond yields are trading lower. The 10-year German bund yield is down -3.4 bp to 3.337%. The 10-year UK gilt yield is down -5.1 bp to 5.270%.
The ECB at its meeting today left its deposit rate unchanged at 2.50%, as the market expected. Separately, ECB President Christine Lagarde announced she will step down on February 7, 2027, paving the way for a successor to be named by year-end. The markets are now pricing in a 78% chance of a +25 bp rate hike at the ECB’s next policy meeting on December 17.
US Stock Movers
The Magnificent Seven are mixed, with Alphabet (GOOGL) plunging more than -12% after reporting disappointing search and advertising sales, sectors that are threatened by AI.
Microsoft (MSFT) is down nearly -2% even though its after-market earnings report on Wednesday showed solid cloud sales. Amazon.com (AMZN) is down more than -3% ahead of its earnings report after today’s close.
The iShares Semiconductor ETF (SOXX) is down nearly -2%, with almost all chip companies trading lower. Marvell (MRVL) is down -13% after Bloomberg reported the chip company is near a deal to buy optical equipment manufacturer Lumentum Holdings (LITE), which is up +2% after the news. Arm Holdings (ARM) and Micron Technology (MU) are down more than -3%.
Software stocks are trading lower today after ServiceNow (NOW) and Fortinet (FTNT) both fell more than -20% on disappointing earnings reports and continued concern about whether software companies will be able to survive AI. Atlassian (TEAM) is down more than -8%, and Workday (WDAY) is down more than -6%.
Bitcoin (^BTCUSD) is down -0.2%, undercutting supporting crypto stocks. Iren (IREN) is down more than -6%. Circle Internet (CRCL), Strategy (MSTR), and Riot Platforms (RIOT) are down more than -2%.
Caterpillar (CAT) is down more than -7% despite a slight beat in earnings and sales, as its Q4 sales guidance disappointed.
Earnings Reports (10/29/2026)
Eli Lilly & Co (LLY), DR Horton Inc (DHI), Merck & Co Inc (MRK), Altria Group Inc (MO), LKQ Corp (LKQ), XPO Inc (XPO), Restaurant Brands International (QSR), Silgan Holdings Inc (SLGN), Hyatt Hotels Corp (H), Intercontinental Exchange Inc (ICE), Leonardo DRS Inc (DRS), TPG Inc (TPG), Textron Inc (TXT), Saia Inc (SAIA), Ares Management Corp (ARES), Bunge Global SA (BG), Builders FirstSource Inc (BLDR), Blue Owl Capital Inc (OWL), Cheniere Energy Inc (LNG), Entegris Inc (ENTG), API Group Corp (APG), DT Midstream Inc (DTM), Medical Properties Trust Inc (MPT), Kimco Realty Corp (KIM), BorgWarner Inc (BWA), Hershey Co/The (HSY), AGCO Corp (AGCO), Xcel Energy Inc (XEL), FTI Consulting Inc (FCN), Allegro MicroSystems Inc (ALGM), Huntington Ingalls Industries (HII), Willis Towers Watson PLC (WTW), Carrier Global Corp (CARR), Mastercard Inc (MA), Baxter International Inc (BAX), Trane Technologies PLC (TT), WESCO International Inc (WCC), Brunswick Corp/DE (BC), West Pharmaceutical Services (WST), Sirius XM Holdings Inc (SIRI), KBR Inc (KBR), Insmed Inc (INSM), Axalta Coating Systems Ltd (AXTA), L3Harris Technologies Inc (LHX), Tenet Healthcare Corp (THC), A O Smith Corp (AOS), Cognizant Technology Solutions (CTSH), Linde PLC (LIN), CRH PLC (CRH), Oshkosh Corp (OSK), Alnylam Pharmaceuticals Inc (ALNY), EMCOR Group Inc (EME), IDACORP Inc (IDA), WEC Energy Group Inc (WEC), FTAI Aviation Ltd (FTAI), Quanta Services Inc (PWR), Vulcan Materials Co (VMC), Caterpillar Inc (CAT), Norwegian Cruise Line Holdings (NCLH), Avery Dennison Corp (AVY), TechnipFMC PLC (FTI), Ionis Pharmaceuticals Inc (IONS), American Electric Power Co Inc (AEP), Seaboard Corp (SEB), Tradeweb Markets Inc (TW), Howmet Aerospace Inc (HWM), Ameriprise Financial Inc (AMP), Crocs Inc (CROX), T Rowe Price Group Inc (TROW), Incyte Corp (INCY), Bristol-Myers Squibb Co (BMY), ATI Inc (ATI), Cullen/Frost Bankers Inc (CFR), Columbia Sportswear Co (COLM), Stryker Corp (SYK), Eastman Chemical Co (EMN), AptarGroup Inc (ATR), Gaming and Leisure Properties (GLPI), Republic Services Inc (RSG), Schneider National Inc (SNDR), ResMed Inc (RMD), Ryan Specialty Holdings Inc (RYAN), Digital Realty Trust Inc (DLR), Fedex Freight Holding Co Inc (FDXF), Cousins Properties Inc (CUZ), Edison International (EIX), Weyerhaeuser Co (WY), MasTec Inc (MTZ), Bridgebio Pharma Inc (BBIO), Sandisk Corp (SNDK), Dexcom Inc (DXCM), SPX Technologies Inc (SPXC), Ingersoll Rand Inc (IR), Strategy Inc (MSTR), ROBLOX Corp (RBLX), Floor & Decor Holdings Inc (FND), Illumina Inc (ILMN), GoDaddy Inc (GDDY), Twilio Inc (TWLO), Starbucks Corp (SBUX), Monolithic Power Systems Inc (MPWR), Arthur J Gallagher & Co (AJG), Rivian Automotive Inc (RIVN), Intel Corp (INTC), Coinbase Global Inc (COIN), DaVita Inc (DVA), Pinterest Inc (PINS), Mondelez International Inc (MDLZ), First Solar Inc (FSLR), Gilead Sciences Inc (GILD), Amazon.com Inc (AMZN), Exelixis Inc (EXEL), Reddit Inc (RDDT), Bright Horizons Family Solutio (BFAM), Ingram Micro Holding Corp (INGM), Rocket Cos Inc (RKT), Credit Acceptance Corp (CACC), Mohawk Industries Inc (MHK), Alliant Energy Corp (LNT), Veralto Corp (VLTO), Erie Indemnity Co (ERIE), CubeSmart (CUBE), Olin Corp (OLN), Healthcare Realty Trust Inc (HR).
On the date of publication, Rich Asplund did not directly have a position in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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