Indexes Turn Red as Stocks Give Up Morning Gains

The S&P 500 Index ($SPX) (SPY) today is down -0.66%, the Dow Jones Industrials Index ($DOWI) (DIA) is down -0.59%, and the Nasdaq 100 Index ($IUXX) (QQQ) is down -0.62%.  

After starting the day higher, stock indexes have turned lower and all 3 indexes are red.

Taiwan Semiconductor Manufacturing Co., the world’s most advanced semiconductor manufacturer and chipmaker for Apple and Nvidia, raised its projections for 2025 revenue growth for the second time this year. After setting a new record high early in the session, TSM reversed gains and is trading lower.

Today’s US economic news was mixed for stocks.  On the positive side, the Oct NAHB housing market index rose +5 to a 6-month high of 37, stronger than expectations of 33. Conversely, the Oct Philadelphia Fed business outlook survey fell -36.0 to a 6-month low of -12.8, weaker than expectations of 10.0.

The escalation of trade tensions between the US and China, along with the ongoing US government shutdown, has sparked a buying spree in precious metals as a haven, with gold and silver reaching fresh all-time highs today. 

The shutdown of the US government continues, weighing on market sentiment and delaying key economic reports.  The government shutdown means delays in the release of government reports, including the last three weeks of weekly initial unemployment claims, the Aug US trade report, and the Sep payroll report.  Last Friday, the Bureau of Labor Statistics (BLS) said the September consumer price report, which was originally scheduled to be released on Wednesday, will be released on October 24.  The White House has warned that if the government shutdown lingers, it would trigger widespread dismissals of employees in government programs that don’t align with President Trump’s priorities.  Bloomberg Economics estimates that 640,000 federal workers will be furloughed during the shutdown, which would expand jobless claims and push the unemployment rate up to 4.7%.

The markets this week will focus on earnings results as the Q3 earnings season begins.  Rising corporate earnings expectations are a bullish backdrop for stocks.  According to Bloomberg Intelligence, 78% of the S&P 500 companies that have reported so far have beaten forecasts.  Also, more than 22% of companies in the S&P 500 that provided guidance for their Q3 earnings results are expected to beat analysts’ expectations, the highest in a year.  However, Q3 profits are expected to have risen by +7.2% y/y, the smallest increase in two years.  Also, Q3 sales growth is projected to slow to +5.9% y/y from 6.4% in Q2. 

The markets are pricing in a 97% chance of a -25 bp rate cut at the next FOMC meeting on Oct 28-29. 

Overseas stock markets are higher today.  The Euro Stoxx 50 is up +0.59%.  China’s Shanghai Composite closed up +0.10%.  Japan’s Nikkei Stock 225 closed up +1.27%.

Interest Rates

December 10-year T-notes (ZNZ5) today are down -2 ticks.  The 10-year T-note yield is up +1.5 bp to 4.044%.  T-notes gave up an early advance today and turned slightly lower after a rally in stocks curbed safe-haven demand for government debt securities.  T-notes remained lower after today’s news showed the Oct NAHB housing market index rose more than expected to a 6-month high.

T-notes initially moved higher today on dovish comments from the Fed. Fed Governor Christopher Waller said the Fed can continue to lower interest rates to support a faltering labor market, and Richmond Fed President Tom Barkin stated that US productivity growth appears to be improving “significantly.” T-notes also found support after the Oct Philadelphia Fed business outlook survey fell more than expected to a 6-month low. 

T-notes also have support from the ongoing US government shutdown, which could lead to additional job losses, reduced consumer spending, and a weakened US economy, potentially allowing the Fed to continue cutting interest rates.  

European government bond yields are mixed today.  The 10-year German bund yield is up +1.2 bp at 2.583%. The 10-year UK gilt yield dropped to a 2.25-month low of 4.512% and is down -2.2 bp to 4.521%.

UK Aug manufacturing production rose +0.7% m/m, stronger than expectations of +0.2% m/m

ECB Governing Council member Wunsch said, “I would say that the probability that the ECB cuts interest rates again has been receding over the last few weeks or months.”

Swaps are discounting a 2% chance for a -25 bp rate cut by the ECB at its next policy meeting on October 30.

US Stock Movers

Most Magnificent Seven technology stocks are moving higher today, providing support to the broader market.  Amazon.com (AMZN), Nvidia (NVDA), and Alphabet (GOOGL) are trading slightly higher today.  Tesla (TSLA) is down -1.4%, Meta Platforms (META) is down -.83%, and 

Microsoft (MSFT) is down -0.48%. 

Gold mining stocks are moving higher today after the price of COMEX gold climbed to a new record high.  As a result, Kinross Gold (KGC), Barrick Mining (B), Newmont (NEM), Gold Fields Ltd (GFI), and Anglogold Ashanti Plc (AU) are up more than +2%. 

Praxis Precision Medicines (PRAX) is up more than +200% after two studies in its Phase 3 Essential3 program of ulixacaltamide to treat tremors met their primary endpoints. 

JB Hunt Transport Services (JBHT) is up more than +18% to lead gainers in the S&P 500 after reporting Q3 revenue of $3.05 billion, stronger than the consensus of $3.02 billion. 

Salesforce (CRM) is up more than +4% to lead gainers in the Dow Jones Industrials after projecting revenue growth will accelerate to double digits in the coming years, and announced it will purchase an additional $7 billion of shares in the next six months. 

Snap-on Inc (SNA) is up more than +3% after reporting Q3 EPS of $5.02, stronger than the consensus of $4.64.

DoorDash (DASH) is down -0.61% after the company entered into a partnership with Waymo to make deliveries in the Phoenix area with Waymo’s autonomous vehicles.

US Bancorp (USB) is up 0.20% after reporting Q3 net interest income of $4.25 billion, above the consensus of $4.17 billion. 

Snowflake (SNOW) is down more than -1% after it announced a partnership with Palantir Technologies to integrate Snowflake’s AI Data Cloud with Palantir Foundry and Palantir Artificial Intelligence Platform. 

Hewlett Packard Enterprise (HPE) is down more than -11% to lead losers in the S&P 500 after projecting 2026 earnings of $2.20 to $2.40 a share, weaker than the consensus of $2.41. 

F5 Inc (FFIV) is down more than -12%, adding to Wednesday’s -3% loss, after a potentially “catastrophic” breach of the cybersecurity provider blamed on state-backed hackers from China, with the hackers gaining “long-term, persistent access” to certain systems and stealing files, including source code.

Marsh & McLennan Cos (MMC) is down more than -6% after reporting Q3 adjusted operating margin of 22.7%, below the consensus of 22.9%.

Zions Bancorp (ZION) is down more than -9% after announcing it will record a $60 million provision and charge-off of $50 million after legal action was initiated by banks and other lenders related to two commercial and industrial loans extended by a bank division.

Verisk Analytics (VRSK) is down more than -4% to lead losers in the Nasdaq 100 after Rothschild & Co Redburn downgraded the stock to sell from neutral with a price target of $220. 

Travelers Cos (TRV) is down more than -3% to lead losers in the Dow Jones Industrials after reporting Q3 net premiums written of $11.47 billion, below the consensus of $11.84 billion.

Lululemon Athletica (LULU) is down more than -1% after Bernstein downgraded the stock to market perform from outperform. 

Earnings Reports(10/16/2025)

Bank of New York Mellon Corp/The (BK), Bank OZK (OZK), Charles Schwab Corp/The (SCHW), Commerce Bancshares Inc/MO (CBSH), CSX Corp (CSX), FNB Corp/PA (FNB), Interactive Brokers Group Inc (IBKR), KeyCorp (KEY), M&T Bank Corp (MTB), ManpowerGroup Inc (MAN), Marsh & McLennan Cos Inc (MMC), Snap-on Inc (SNA), Travelers Cos Inc/The (TRV), US Bancorp (USB).