Provided Content: Content provided by Barchart. The Globe and Mail was not involved, and material was not reviewed prior to publication.
Stocks Climb on Positive Corporate News
The S&P 500 Index ($SPX) (SPY) today is up +0.52%, the Dow Jones Industrials Index ($DOWI) (DIA) is up +0.23%, and the Nasdaq 100 Index ($IUXX) (QQQ) is up +0.74%.
Stocks today are trading moderately higher, supported by some positive corporate news. Chips stocks are climbing today, led by an +11% jump in GlobalFoundries after it reported better-than-expected Q3 net revenue and forecasted Q4 net revenue above consensus. Also, Palantir Technologies is up more than +19% after reporting stronger-than-expected Q3 revenue and raising its full-year adjusted operating profit estimate.
Global equity markets have some positive carryover from signs of strength in China’s economy that sparked a rally in Chinese stocks. The Shanghai Composite Index jumped more than +2% today to a 3-1/2 week high after the China Oct Caixin services PMI rose +1.7 to 52.0, stronger than expectations of 50.5.
On the negative side, Archer-Daniels-Midland is down more than -9% after canceling its quarterly earnings call and saying it will amend previous financial statements after finding additional accounting issues. Also, NXP Semiconductors NV is down more than -5% after forecasting Q4 revenue below the consensus.
Today's US economic news was negative for stocks as the Sep trade deficit was -$84.4 billion, wider than expectations of -$84.0 billion and the largest deficit in nearly 2-1/2 years, a negative factor for Q3 GDP.
The markets are focused on (1) today’s US presidential election, where polls are showing the election a toss-up and official results may not be known for several days, (2) today’s Oct ISM services index, expected -1.1 to 53.8, (3) the results of this week’s FOMC meeting on Wednesday and Thursday (expected a -25 bp rate cut) and post-meeting comments from Fed Chair Powell, and (4) Q3 corporate earnings results with nearly 20% of the S&P 500 companies scheduled to report this week.
Of the companies in the S&P 500 that have released Q3 earnings so far, 78% surpassed estimates. According to Bloomberg Intelligence, companies in the S&P 500 are expected to report an average +4.3% y/y increase in quarterly earnings in Q3, down from the +7.9% y/y growth consensus seen in July.
The markets are discounting the chances at 99% for a -25 bp rate cut at the November 6-7 FOMC meeting and at 0% for a -50 bp rate cut at that meeting.
Overseas stock markets today are higher. The Euro Stoxx 50 is up +0.03%. China's Shanghai Composite Index climbed to a 3-1/2 week high and closed up +2.32%. Japan's Nikkei Stock 225 closed up +1.11%.
Interest Rates
December 10-year T-notes (ZNZ24) today are down -3 ticks. The 10-year T-note yield is up +3.2 bp at 4.317%. Dec T-notes today are mildly lower, pressured by negative carryover from a decline in European government bonds. Also, today’s strength in stocks has reduced safe-haven demand for T-notes. In addition, supply pressures are weighing on T-notes as the Treasury will auction $42 billion of 10-year T-notes later today as part of this week’s $125 billion T-note and T-bond auctions for the November quarterly refunding.
Losses in T-notes are limited by expectations that the FOMC will cut interest rates by 25 bp on Thursday. Also, uncertainty about the outcome of today’s US presidential election has boosted some safe-haven demand for T-notes.
European government bond yields today are moving higher. The 10-year German bund yield is up +1.4 bp to 2.408%. The 10-year UK gilt yield is up +3.9 bp to 4.497%.
French Sep manufacturing production fell -0.8% m/m, a smaller decline than expectations of -1.3% m/m.
Swaps are discounting the chances at 100% for a -25 bp rate cut by the ECB at its December 12 policy meeting and at 17% for a -50 bp rate cut at the same meeting.
US Stock Movers
GlobalFoundries (GFS) is up more than +11% to lead gainers in the Nasdaq 100 and lead chip stocks higher after reporting Q3 net revenue of $1.74 billion, stronger than the consensus of $1.73 billion, and forecasting Q4 net revenue of $1.80-$1.85 billion, with the midpoint above the consensus of $1.80 billion. Also, Broadcom (AVGO) and Marvell Technology (MRVL) are up more than +2%. In addition, Nvidia (NVDA), Lam Research (LRCX), Applied Materials (AMAT), Advanced Micro Devices (AMD), and KLA Corp (KLAC) are up more than +1%.
Palantir Technologies (PLTR) is up more than +19% to lead gainers in the S&P 500 after reporting Q3 revenue of $725.5 million, stronger than the consensus of $703.7 million, and raising its full-year adjusted operating profit estimate to $1.05 billion-$1.06 billion from a previous estimate of $966 million-$974 million, well above the consensus of $970.5 million.
Emerson Electric (EMR) is up more than +7% after reporting Q4 net sales of $4.62 billion, above the consensus of $4.54 billion.
Cummins Inc (CMI) is up more than +5% after reporting Q3 net sales of $8.46 billion, stronger than the consensus of $8.29 billion.
Apollo Global Management (APO) is up more than +6% after reporting Q3 adjusted EPS of $1.85, higher than the consensus of $1.73.
Louisiana-Pacific (LPX) is up more than +6% after reporting Q3 net sales of $722 million, stronger than the consensus of $696.1 million.
DuPont de Nemours (DD) is up more than +4% after boosting guidance on its full-year adjusted EPS estimate to $3.90 from a previous forecast of $3.70-$3.80.
Celanese Corp (CE) is down more than -24% to lead losers in the S&P 500 after reporting Q3 adjusted EPS of $2.44, weaker than the consensus of $2.85, and forecast Q4 adjusted EPS of $1.25, well below the consensus of $2.94.
Archer-Daniels-Midland (ADM) is down more than -10% after canceling its quarterly earnings call and saying it will amend previous financial statements after finding additional accounting issues.
NXP Semiconductors NV (NXPI) is down more than -6% after forecasting Q4 revenue of $3.0 billion-$3.2 billion, weaker than the consensus of $3.36 billion.
Wynn Resorts Ltd (WYNN) is down more than -5% after reporting Q3 operating revenue of $1.69 billion, weaker than the consensus of $1.73 billion.
Hologic Inc (HOLX) is down more than -5% after forecasting 2025 revenue of $4.15 billion-$4.20 billion, below the consensus of $4.21 billion.
Henry Schein (HSIC) is down more than -5% after reporting Q3 net sales of $3.17 billion, weaker than the consensus of $3.24 billion.
Lattice Semiconductor (LSCC) is down more than -3% after forecasting Q4 revenue of $112 million-$122 million, below the consensus of $132.1 million.
Cleveland-Cliffs (CLF) is down more than -10% after reporting Q3 revenue of $4.57 billion, weaker than the consensus of $4.74 billion.
Earnings Reports (11/5/2024)
Archer-Daniels-Midland Co (ADM), Assurant Inc (AIZ), Broadridge Financial Solutions (BR), Builders FirstSource Inc (BLDR), Cummins Inc (CMI), Devon Energy Corp (DVN), DuPont de Nemours Inc (DD), Emerson Electric Co (EMR), Expeditors International of Washington (EXPD), Gartner Inc (IT), Henry Schein Inc (HSIC), International Flavors & Fragrances (IFF), Jack Henry & Associates Inc (JKHY), Marathon Petroleum Corp (MPC), Microchip Technology Inc (MCHP), Super Micro Computer Inc (SMCI), Targa Resources Corp (TRGP), Yum! Brands Inc (YUM).
More Stock Market News from Barchart
- Did This AI Chip Giant Just Score a Major Victory Over Nvidia?
- Is Microsoft Stock a Buy, Sell, or Hold After Earnings?
- Kraft Heinz Stock: Is Wall Street Bullish or Bearish?
- Is Wall Street Bullish or Bearish on Hess Corporation Stock?
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions 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.