Executive Summary
The Story So Far
Why This Matters
Who Thinks What?
Stock market futures showed little change ahead of Tuesday’s open, following a rally on Monday that brought major indexes near record highs. Key individual stocks like Apple, Alphabet, Netflix, and Tesla saw significant gains, while Oracle continued a two-day sell-off. Investors are also anticipating upcoming earnings reports, crucial inflation data, and developments in U.S.-China trade relations this week.
Individual Stock Performance
Apple shares jumped nearly 4% to record highs on Monday, clearing a 259.24 handle entry after Loop Capital upgraded the stock to buy from hold and raised its price target. Google parent Alphabet’s stock climbed 1.3%, closing above an alternate entry.
Netflix shares regained their 50-day moving average with a 3.3% gain. The company is expected to report its third-quarter results late Tuesday, with analysts focusing on progress in scaling its advertising-supported service. Tesla raced nearly 2% higher, taking out Friday’s high, though volatile market action and upcoming earnings after Wednesday’s close raise risks for investors.
Conversely, Oracle shares tumbled nearly 5%, adding to a previous near-7% dive on Friday. The stock is pulling back sharply to its 50-day line, a key technical level to monitor. Regional bank Zions Bancorp rallied more than 3% after reporting better-than-expected third-quarter results, despite sparking banking fears last week with a $50 million charge-off related to two borrowers.
Other key earnings reports scheduled for this week include Lockheed Martin, GE Aerospace, RTX, and Northrop Grumman.
Economic and Geopolitical Developments
Treasury Secretary Scott Bessent announced he will meet with Chinese Vice Premier He Lifeng this week to address escalating trade measures between the two nations. This follows a “frank and detailed” virtual conversation held on Friday evening.
China recently announced stricter export curbs on rare earths and components for electric vehicle batteries. In response, President Donald Trump announced a 100% extra tariff on Chinese goods, set to commence on November 1.
On the economic front, the Consumer Price Index (CPI) for September is expected to be released on Friday. Analysts forecast a 0.3% rise in core prices, excluding food and energy, while the headline 12-month inflation rate is projected to increase to 3.1% from 2.9%. The Labor Department confirmed these figures would be released despite a potential government shutdown, as they are crucial for determining Social Security cost-of-living adjustments.
Market Overview
On Monday, the Dow Jones Industrial Average rallied 1.1%, or 515 points, while the S&P 500 moved up 1.1% and the Nasdaq composite climbed 1.4%. Ahead of Tuesday’s opening bell, Dow Jones futures, S&P 500 futures, and tech-heavy Nasdaq 100 futures traded slightly lower.
The 10-year U.S. Treasury yield ticked lower to 3.98%. In the commodities market, oil prices dipped, with West Texas Intermediate futures settling near $57 a barrel.
Market Outlook
The market continues to navigate a blend of strong individual stock performances and declines, while investors closely monitor upcoming corporate earnings, inflation data, and international trade discussions for further direction.
