Stocks Pressured by Higher Bond Yields and Weakness in Chipmakers

The S&P 500 Index ($SPX) (SPY) today is down -0.64%, the Dow Jones Industrials Index ($DOWI) (DIA) is down -0.25%, and the Nasdaq 100 Index ($IUXX) (QQQ) is down -1.09%.  December E-mini S&P futures (ESZ25) are down -0.70%, and December E-mini Nasdaq futures (NQZ25) are down -1.15%.

US stock indexes are moving lower today as most of the optimism over the reopening of the US government has already been priced in. Higher T-note yields today are a drag on stocks, with the 10-year T-note yield up +4 bp to 4.11%.  Wednesday evening, Boston Fed President Susan Collins said, "It will likely be appropriate to keep policy rates at the current level for some time to balance the inflation and employment risks in this highly uncertain environment." Also, weakness in chipmakers today is a drag on the overall market.

As expected, President Trump signed legislation Wednesday evening that ended the longest US government shutdown in history.  The bill provides full-year funding for some departments, funds other agencies through January 30, and includes pay for furloughed government workers.  The bill also resumes federal payments to states and localities and recalls agency employees who were laid off during the shutdown. 

The Congressional Budget Office (CBO) projected that the six-week government closure would reduce real GDP growth in the current quarter by 1.5 percentage points.  However, more than half of the loss may be recovered early next year as federal programs resume and government employees receive back pay, according to the CBO.

The White House on Wednesday said that the monthly October payrolls report and consumer price index are unlikely to be released due to the government shutdown.  The Bureau of Labor Statistics is expected to publish a calendar in the coming days with updated release dates for delayed economic data.

The markets are discounting a 53% chance of another -25 bp rate cut at the next FOMC meeting on December 9-10.

Q3 corporate earnings season is nearly over, as 456 of the S&P 500 companies have reported earnings results.  According to Bloomberg Intelligence, 82% of reporting S&P 500 companies exceeded forecasts, on course for the best quarter since 2021.  Q3 earnings rose +14.6%, more than doubling expectations of +7.2% y/y. 

Overseas stock markets are mixed today.  The Euro Stoxx 50 fell from a new record high and is down -0.12%.  China's Shanghai Composite climbed to a 10-year high and closed up +0.73%.  Japan's Nikkei Stock 225 closed up +0.43%.

Interest Rates

December 10-year T-notes (ZNZ5) today are down -8 ticks.  The 10-year T-note yield is up +4.0 bp to 4.110%.  T-notes are under pressure today as the US government reopens, reducing safe-haven demand for T-notes.  Also, hawkish comments Wednesday evening from Boston Fed President Susan Collins weighed on T-notes, when she said she favored keeping interest rates steady "for some time." In addition, supply pressures are undercutting T-notes as the Treasury will auction $25 billion in 30-year T-bonds later today to conclude this week's $125 billion quarterly refunding.

European government bond yields are moving higher today.  The 10-year German bund yield recovered from a 1-week low of 2.639% and is up +2.3 bp to 2.666%.  The 10-year UK gilt yield is up +2.1 bp to 4.419%.

Eurozone Sep industrial production rose +0.2% m/m, weaker than expectations of +0.7% m/m.

UK Sep industrial production fell -2.0% m/m, weaker than expectations of -0.2% m/m and the biggest decline in more than 4.5 years.

UK Q3 GDP rose +0.1% q/q and +1.3% y/y, weaker than expectations of +0.2% q/q and +1.4% y/y.

Swaps are discounting a 3% chance for a -25 bp rate cut by the ECB at its next policy meeting on December 18.

US Stock Movers

Chip stocks are falling today and weighing on the overall market. Marvel Technology (MRVL) and GlobalFoundries (GFS) are down more than -3%. Also, Advanced Micro Devices (AMD), Nvidia (NVDA), Intel (INTC), and Broadcom (AVGO) are down more than -2%.  Also, Applied Materials (AMAT), ARM Holdings Plc (ARM), KLA Corp (KLAC), and Lam Research (LRCX) are down by more than -1%. 

Ardent Health (ARDT) is down more than -34% after cutting its full-year adjusted Ebitda forecast to $530 million-$555 million from a previous forecast of $575 million-$615 million, well below the consensus of $600.6 million. 

Webtoon Entertainment (WBTN) is down more than -21% after forecasting Q4 revenue of $330 million to $340 million, well below the consensus of $382.3 million.

Ibotta Inc (IBTA) is down more than -19% after forecasting Q4 revenue of $80 million to $85 million, the midpoint below the consensus of $84.2 million. 

Walt Disney (DIS) is down more than -8% to lead losers in the S&P 500 and Dow Jones Industrials after reporting Q4 revenue of $22.46 billion, below the consensus of $22.83 billion. 

Dlocal Ltd (DLO) is down more than -7% after reporting Q3 adjusted Ebitda margin of 25%, weaker than the consensus of 26.3%. 

Dollar Tree (DLTR) is down more than -3% after Goldman Sachs double-downgraded the stock to buy from sell with a price target of $103. 

Sealed Air Corp (SEE) is up more than +19% after Clayton Dubilier & Rice said it was exploring a potential acquisition of the company.

Dillard's Inc. (DDS) is up more than +18% after reporting Q3 EPS of $8.31, well above the consensus of $6.26.

Firefly Aerospace (FLY) is up more than +15% after reporting Q3 revenue of $30.8 million, stronger than the consensus of $27.8 million, and said it plans to resume launches of its Alpha rocket between late 2025 and early next year. 

Albemarle (ALB) is up more than +5% to lead gainers in the S&P 500 after Mizuho Securities raised its price target on the stock to $110 from $92.

Cisco Systems (CSCO) is up more than +4% to lead gainers in the Dow Jones Industrials and Nasdaq 100 after boosting its 2026 revenue forecast to $60.2 billion -$61.0 billion from a previous forecast of $59 billion-$60 billion, stronger than the consensus of $59.64 billion. 

AutoZone (AZO) is up more than +2% after Goldman Sachs upgraded the stock to buy from neutral with a price target of $4,262.

Nike (NKE) is up more than +1% after Wells Fargo Securities upgraded the stock to overweight from equal weight with a price target of $75.

Earnings Reports(11/13/2025)

Applied Materials Inc (AMAT), Globant SA (GLOB), NIQ Global Intelligence Plc (NIQ), NU Holdings Ltd/Cayman Islands (NU), Walt Disney Co/The (DIS).