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Thursday, October 31

Some of the largest macro moves in the market today include: S&P 500 Index (US) -0.6%. Some of the largest moves among US mega-cap stocks include: Microsoft Corp (MSFT) -3.7%. Meta Platforms Inc (META) -2.1%. Broadcom Inc (AVGO) -1.5%. 

The Bank of Japan (BoJ) has maintained its key short-term interest rate at around 0.25%, aligning with market expectations and reflecting a cautious approach amid ongoing economic uncertainties. This decision comes as the Japanese yen shows slight strength, influenced by BoJ Governor Ueda's comments indicating vigilance regarding domestic recovery and external factors such as upcoming US elections.

In the United States, recent economic data highlights resilience in consumer spending despite tight credit conditions. Personal income rose by 0.3% for September while personal consumption expenditures increased more than expected, suggesting continued robustness in household finances ahead of critical employment reports due this week that may influence Federal Reserve policy decisions.

European markets are reacting to mixed inflationary signals from major economies; Eurozone inflation edged up to 2% in October against forecasts of lower rates, which complicates prospects for aggressive monetary easing by the European Central Bank (ECB). The ECB is emphasizing potential risks associated with restrictive policies amidst signs of weakening growth across member states leading into significant political events like the impending US presidential election on November 5th.

SPDR S&P 500 ETF Trust (SPY) [-0.6%]
The SPDR S&P 500 ETF Trust (SPY) has seen a price decline of approximately 0.6%, currently priced at 5,806, down from an overnight high of 5,844. The American Association of Individual Investors' weekly survey indicates a rise in the bull-bear spread to 8.6, with bullish sentiment increasing to 39.5%. Job cuts for October are reported at 55,597, a decrease from the previous 72,821. Mixed earnings reports from major technology companies have influenced the broader market; Microsoft and Meta Platforms reported strong revenues but faced stock price declines due to concerns over increased spending on artificial intelligence initiatives. Microsoft fell nearly 4%, while Meta dropped over 3% after-hours. Concurrently, the S&P 500 Index is down by 0.5%, reflecting cautious market sentiment ahead of key data releases.

SPDR Gold Shares (GLD) [-0.3%]
SPDR Gold Shares (GLD) has experienced a price decline of 0.3% since Wednesday. This movement occurs amid rising U.S. Treasury yields and a strong labor market, which have tempered expectations for Federal Reserve rate cuts. Geopolitical tensions related to the upcoming U.S. presidential election are also contributing to safe-haven flows into gold, although these factors have not been sufficient to support price increases. Additionally, silver prices have dropped, reflecting broader market sentiment and potentially influencing behavior towards gold. Despite a record high for gold driven by favorable economic data, including significant job growth reported by ADP, the overall market closed lower, further complicating the economic backdrop for gold investments.

EL | -22.8% | -5.5B
Estee Lauder Companies Inc | Personal Care Products
Estee Lauder Companies Inc has made notable adjustments to its fiscal outlook and dividend policy, withdrawing its fiscal 2025 guidance due to uncertainties in mainland China and Asia travel retail, alongside recent leadership changes. The company has reduced its quarterly dividend by 47%, from $0.66 to $0.35 per share. In its first-quarter results, Estee Lauder reported a net loss of $156 million, compared to a net income of $31 million in the prior year, with revenues of $3.36 billion, falling short of analyst expectations. The adjusted earnings per share were reported at $0.14, exceeding the consensus estimate of $0.09. The diluted net loss per common share was $0.43, while adjusted net income increased by 7% in constant currency. Additionally, the company set its Q2 adjusted EPS guidance between $0.20 and $0.35, significantly lower than the previous estimate of $1.05.

CMCSA | +4.8% | +8.3B
Comcast Corp | Cable & Satellite
Comcast Corp reported its Q3 2024 results, showing an adjusted earnings per share (EPS) of $1.12, surpassing the analyst estimate of $1.06 by 5.66%. Revenue reached $32.07 billion, exceeding the consensus estimate of $31.66 billion and marking a 6.5% increase from $30.12 billion in the same quarter last year. The company declared a quarterly dividend of $0.31 per share, yielding 2.9% annually. Additionally, Comcast's Peacock streaming service experienced significant growth, with revenue rising 82% to $1.5 billion and paid subscribers increasing to 36 million, reflecting a 29% year-over-year growth. Following the earnings announcement, the stock price moved notably higher, increasing by 10% shortly thereafter.

UBER | -9.0%| -13.6B
Uber Technologies Inc | Passenger Ground Transportation
Uber Technologies Inc. reported its third-quarter earnings, posting earnings per share of $1.20, significantly above the consensus estimate of $0.37. Revenue reached $11.19 billion, surpassing expectations of $10.99 billion and reflecting a 20% year-over-year increase. However, gross bookings were reported at $40.97 billion, below the forecast of $41.24 billion. For the fourth quarter, Uber expects gross bookings between $42.75 billion and $44.25 billion, which is below the anticipated $43.67 billion. The adjusted EBITDA for Q3 was $1.69 billion, marking a 55% year-over-year increase. Following the earnings announcement, shares declined sharply in premarket trading, reflecting market reaction to the bookings shortfall and trip outlook misses.

HOOD | -10.9%| -2.4B
Robinhood Markets Inc | Investment Banking & Brokerage
Robinhood Markets Inc reported its third-quarter earnings on October 30, 2024, revealing net revenue of 637 million, below the consensus estimate of 650.67 million. The adjusted earnings per share came in at 0.17, slightly missing the expected 0.18. Despite a year-over-year revenue increase of 36.4%, customer engagement metrics declined, with monthly active users reported at 11 million against a consensus of 12.3 million. Additionally, net deposits fell significantly from 13.2 billion to 10 billion. Following the earnings announcement, Robinhood shares dropped approximately 14% in after-hours trading. Social media discussions reflected surprise at the double miss, noting an increase in net income to 150 million from a loss of 85 million in the same quarter last year. The company plans to end its 1% Gold deposit boost in November due to insufficient customer activity.

ARM | -4.6% | -7.1B
Arm Holdings PLC | Semiconductors
Arm Holdings PLC has been downgraded to "underperform" by Bernstein, with a price target set at 100. This downgrade was issued approximately 1 hour and 22 minutes ago. Additionally, SoftBank is reportedly shifting Arm's technology focus towards a new network of data centers for AI applications, directly competing with Nvidia. This marks a significant change from Arm's traditional business model centered on selling intellectual property. Concurrently, a legal dispute with Qualcomm raises concerns about Arm's future earnings, as highlighted in recent social media discussions. The company is also expected to announce its Q2 FY2025 earnings on November 6, 2024, with an EPS estimate of 0.25 and a revenue estimate of 807.6 million, slightly up from previous estimates.

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