US stocks slipped on Monday as investors overhauled their views on interest rate cuts after a blowout jobs report ahead of a week of key inflation data and the start of earnings season.
The Dow Jones Industrial Average (^DJI) fell 0.3% after notching a fresh record high as stocks soared to close the week. The S&P 500 (^GSPC) shed roughly 0.2%, while the tech-heavy Nasdaq Composite (^IXIC) led the losses with a 0.4% drop.
Oil jumped more than 2% on Monday, extending their biggest weekly gains in over a year as traders price in whether Israel's expected response to Iran's recent attack will involve targeting the country's petroleum fields. Brent (BZ=F) touched $80 per barrel for the first time since August during the session.
Traders have abandoned last week's bets on a 0.50% rate cut in November and now see an 88% chance of a 0.25% move, according to the CME FedWatch Tool. Those expectations could drag on stocks, which have rallied to records amid confidence that big rate cuts and an economic "soft landing" were on the table.
The wait is now on for the October consumer inflation report due Thursday to provide fresh insight into whether the Fed is making progress on bringing already-cooling price pressures down to its 2% target.
The start of third quarter earnings is in focus as Goldman Sachs (GS) raised its target for the S&P 500, saying it expects higher margin growth for corporate companies. After Pepsi (PEP) results on Tuesday, the season gets underway in earnest on Friday with reports from big banks JPMorgan (JPM), Wells Fargo (WFC), and BlackRock (BLK).
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Alexandra Canal
DJT stock surges after Elon Musk appears at Trump rally
Shares of Trump Media & Technology Group (DJT) surged about 15% on Monday after Elon Musk made a surprise appearance at Donald Trump's rally in Butler, Pennsylvania over the weekend — the same location the former president survived an assassination attempt in July.
The tech billionaire, who serves as the CEO of Tesla (TSLA) and SpaceX and also owns social media platform X (formerly Twitter), has been outspoken about his support of Trump ahead of next month's election. Trump has even said he would consider a cabinet position for Musk but that the businessman likely would not be able to serve "with all the things he's got going on."
At Saturday's rally, Musk told the crowd that Trump is the only candidate who can "preserve democracy in America," adding this will be "the last election" if Trump does not win.
The former president remains in a deadlocked race against current vice president and Democratic nominee Kamala Harris, who just embarked on a flurry of media appearances in an attempt to solidify recent momentum in the polls.
Harris appeared on an episode of "Call Her Daddy," a popular podcast catered toward Generation Z, along with a sit-down interview for "60 Minutes."
Laura Bratton
Super Micro Computer stock surges on AI server demand
Nvidia (NVDA) customer and AI server maker Super Micro Computer (SMCI) jumped as much as 17% Monday after the company announced shipment data.
Super Micro Computer said Monday morning that it's shipped over 2,000 of its high-end servers to large-scale AI data centers since June. The company said it's now selling servers using over 100,000 AI chips per quarter — a sign that there's no near-term slow down in AI demand, as analysts and investors have feared. The server maker said it's selling its hardware to "some of the largest AI factories ever built."
Super Micro's stock climb on Monday is helping it recover from a downturn in late September, when shares fell 15% following reports that the company was being probed by the US Department of Justice over possible accounting violations.
Super Micro stock surged at the beginning of 2024 as Big Tech has rushed to create new generative artificial intelligence technologies with ever-increasing energy demands. The stock has tumbled since reaching highs near $120 per share in March.
Ines Ferré
Oil extends gains, up 2% as market awaits Israeli retaliation against Iran
Oil extended its gains on Monday following its biggest weekly gain in more than a year in anticipation of an Israeli retaliation against Iran for last week's missile strike.
West Texas Intermediate futures (CL=F) advanced more than 2% to trade above $76 per barrel after gaining more than 9% last week. Brent crude futures (BZ=F), the international benchmark, also rose more 2% to touch $80 per barrel for the first time since August.
Tel Aviv has vowed to strike back after Iran launched some 200 ballistic missiles toward Israel on Tuesday. Traders have been pricing in the chances that a response will target Iran's oil infrastructure.
"The Iranian military has responded by saying any attack from Israel would trigger yet a stronger response from Iran, so the Geopolitical stages effect on crude continues to grow," Dennis Kissler, BOK Financial's senior vice president of trading, wrote on Monday.
Nvidia (NVDA) and Amazon (AMZN), two of the 'Magnificent Seven' megacap tech stocks, were moving in opposite directions on Monday.
Chip heavyweight Nvidia rose more than 1% to trade above $126 per share.
E-commerce and cloud giant Amazon fell more than 2% after Wells Fargo downgraded the stock to Equal-weight from Overweight amid the expectation that advertising revenue will moderate.
Growth in Amazon's cloud unit isn't likely to make up for margin headwinds, according to Wells Fargo analyst Ken Gawrelski. “AWS strength alone is not enough," he wrote.
Ines Ferré
Stocks open lower as 10-year Treasury yield tops 4%
The major averages opened lower on Monday as the 10-year Treasury yield (^TNX) rose back above 4%.
The Dow Jones Industrial Average (^DJI) fell about 0.3% after notching a fresh record high on Friday. The S&P 500 (^GSPC) shed roughly 0.3%, while the tech-heavy Nasdaq Composite (^IXIC) fell 0.5%.
The yield on the benchmark 10-year Treasury (^TNX) hit 4% for the first time since August, as hopes of another 50 basis point rate cut from the Federal Reserve faded after a stronger-than-expected September jobs report.
Oil prices extended gains on Monday following their biggest weekly increase in more than a year as markets awaited an Israeli retaliation against Iran over its missile barrage last week.
West Texas Intermediate crude futures (CL=F) advanced more than 1% to trade above $75 per barrel, after gaining more than 9% last week. Brent futures (BZ=F), the international benchmark, also advanced more than 1% to trade above $79 per barrel.
Laura Bratton
Pfizer stock jumps on reports of Starboard taking $1 billion stake
Pfizer (PFE) stock rose 2.6% premarket Monday as investors reacted to multiplemediareports that activist investor Starboard Value has taken a $1 billion stake in the pharmaceutical giant.
Starboard has approached Pfizer executives Ian Read and Frank D'Amelio about helping turn the tides at the drugmaker, various media outlets reported, citing unnamed sources. Pfizer, the manufacturer of the world's first-approved COVID-19 vaccine, has struggled to maintain its dominance post-pandemic. Read and D'Amelio expressed interest in assisting Starboard, The Wall Street Journal reported. Starboard's plans and the changes it would make at Pfizer are unclear.
The stock's moves early Monday morning will bring it into the positive for the year, but shares are far below record highs of nearly $60 in 2022.
Pfizer is set to report earnings on Oct. 29. Wall Street analysts expect the company to report revenues of $14.8 billion, up about 12% from the prior year. Only half of analysts covering the stock recommend buying it, according to Bloomberg data.
OTTAWA — A federal inquiry says the Liberal government has consented to the public disclosure of summaries of cabinet documents about foreign interference.
Republican presidential candidate Donald Trump's tax and spending plans would produce more than twice as much new debt as the plans from Vice President Kamala Harris, a budget-focused think-tank estimated on Monday. The Committee for a Responsible Federal Budget, which advocates reducing federal deficits, released new detailed estimates showing Harris' tax and spending plans would add $3.5 trillion to deficits over 10 years, while Trump's would add $7.5 trillion. It also included high and low estimates, including for Harris zero added debt on the low end and $8.1 trillion additional debt on the high end.
Where does President Biden's student loan forgiveness plan stand after a Missouri federal judge placed an injunction on the administration's initiative last week? The Saving on a Valuable Education (SAVE) Plan, which features a clause to eliminate 100% of remaining interest for loan borrowers, sits in legal purgatory at this time. Edvisors director of corporate communications Elaine Rubin sits down with Brad Smith to talk about the Biden administration's biggest hurdles in pushing forward its student loan forgiveness agenda. "So in this election year, we know that the Kamala [Harris] administration, they are aiming to continue some of the plans that the Biden administration has already started. So defending the SAVE Plan and going towards that broad forgiveness," Rubin explains. "The Trump administration has been relatively quiet on these specific plans. However, when it comes down to it, there are some very significant platforms that he's running for in higher education, including some of the platforms of eliminating different types of forgiveness options and potentially even eliminating the US Department of Education." For more expert insight and the latest market action, click here to watch this full episode of Wealth! This post was written by Luke Carberry Mogan.
MANKATO, Minn. (AP) — Jury selection begins Monday in the murder trial of the former boyfriend of a Minnesota woman whose body was found hidden in a rural area of the state in 2023.
WASHINGTON (AP) — The Supreme Court on Monday let stand a decision barring emergency abortions that violate the law in Texas, which has one of the country's strictest abortion bans.
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Two separate structure fires in Arapahoe County that damaged two homes this weekend were sparked by sources not allowed under current county-wide fire restrictions.
People in Winter Park, Florida are preparing for Hurricane Milton's approach to Florida as the storm rapidly strengthened on a path toward population centers including Tampa and Orlando.
A woman was diagnosed with one of the rarest pregnancies in the world after discovering one of her 'twins' was actually a tissue which can develop into cancer. Lara Eastwood, 36, found out she was pregnant with twins at just six weeks along. She was given the devastating news she had lost one of them at her eight-week scan.
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