Ringside · Pre-Bell · October 7
- Houthi missiles aimed at Aden's airport and Saudi Arabia overnight keep Brent above $100, at $101.91.
- Minutes from the Fed's September rate increase land at 2:00 p.m., with October hike odds near 20%.
- Chip-equipment makers drop more than 2% after UBS cut BE Semiconductor to Sell and Disco lost 6.3% in Tokyo.
Indexes
Stock futures are trimming Tuesday's records rather than reversing them. The S&P 500 closed at 7,818.93, its first finish above 7,800 and above the previous record of 7,798.99 set on August 13, and the Nasdaq 100 finished at 31,224.47, above Monday's previous record of 31,076.44. Overseas the mood is worse: Frankfurt and Paris are down more than 1% as oil and bond yields climb, and Seoul fell almost 2% on chip stocks. Mainland China remains shut for the National Day holiday and reopens Thursday.
| US benchmark | Tuesday close | % Chg | Note |
|---|---|---|---|
| S&P 500 | 7,818.93 | +0.58% | Record, vs the prior record of 7,798.99 |
| Nasdaq Composite | 27,599.79 | +0.45% | |
| Dow Jones Industrial Average | 51,521.28 | +0.49% | |
| Russell 2000 | 2,830.30 | -0.59% | Healthcare weighed on small caps |
| Futures / overnight | Level | % Chg | Note |
|---|---|---|---|
| ES (S&P 500) | 7,858.50 | -0.28% | |
| NQ (Nasdaq 100) | 31,320.25 | -0.51% | Semiconductors lead the decline |
| YM (Dow) | 51,589.00 | -0.37% | |
| RTY (Russell 2000) | 2,832.80 | -0.33% | |
| Euro Stoxx 50 | 6,179.47 | -1.54% | Infineon and French banks lower |
| DAX | 25,115.71 | -1.35% | Ends a three-session winning run |
| CAC 40 | 7,780.52 | -1.13% | |
| FTSE 100 | 10,468.82 | -0.71% | |
| Nikkei 225 | 70,035.71 | -0.92% | Disco and Kioxia led losses |
| Kospi | 6,803.90 | -1.98% | Samsung reports Thursday |
| Hang Seng | 24,130.50 | -0.62% |
In the News
Rates, FX, Commodities
Treasury yields eased Tuesday from Monday's 5.31% ten-year close, the highest in 24 years per Yahoo Finance, and the ten-year auction this afternoon is the first real test of that relief. Crude has two separate supply worries: Houthi attacks on Saudi targets, and a Gulf of Mexico storm that forecasters expect to become the first Atlantic hurricane of 2026 within two days, in waters that produce 15% of American crude, Reuters reports. Industry data Tuesday evening showed crude stocks falling 2.09 million barrels.
| Rates & volatility | Level | % Chg | Note |
|---|---|---|---|
| 2-year Treasury | 4.84% | Monday close, Federal Reserve H.15 | |
| 10-year Treasury | 5.27% | -0.79% | Tuesday close, from 5.31% |
| 30-year Treasury | 5.64% | -0.42% | Tuesday close; reopening Thursday |
| 2s10s spread | 47 bp | Monday close | |
| VIX | 15.60 | +3.93% | |
| Dollar index | 102.28 | +0.25% |
| Commodity | Overnight futures | Tue settle | % Chg |
|---|---|---|---|
| WTI crude | $90.03 | $89.44 | +0.66% |
| Brent crude | $101.91 | $100.58 | +1.32% |
| Gold | $4,141.20 | $4,187.10 | -1.10% |
| Natural gas | $3.169 | $3.114 | +1.77% |
Technicals
August's peak becomes the first test from above. S&P 500 futures 0.28% lower imply an open near 7,797, right at the 7,798.99 August high, which now acts as first support; the 20-day average at 7,680.09 and 50-day at 7,673.00 sit almost on top of each other another 1.5% down. Only about a quarter of S&P 500 members trade above their 50-day averages, per Yahoo Finance, which says something about who is carrying the index.
The Nasdaq 100 closed 3.8% above its 20-day average of 30,070.09, a stretched reading that leaves room for this morning's 0.51% giveback without damage. The ten-year yield at 5.27% remains well above its 20-day average of 5.10%, and a close back over Monday's 5.31% would set a new high for the move. The two-year at 4.84% on Monday's close keeps the curve steep, at 47 basis points.
Breakouts & Breakdowns
Breakouts
Advanced Micro Devices (AMD) closed at a record $649.42, above the previous record of $633.91 from October 2, and stands 25% over its 50-day average of $518.82. Indicated at $637.25, it holds above that old high.
Marvell Technology (MRVL) finished at $287.01, its highest close since June 30's $297.89, and well clear of a 50-day average of $230.22. The June 4 peak of $316.43 is the next level overhead.
Breakdowns
Western Digital (WDC) is approaching its 200-day average of $402.58. It closed at $411.04, below both the 20-day at $444.84 and the 50-day at $462.86, and is indicated at $403.20.
Stryker (SYK) is testing the 52-week low of $269.75 it set on September 24, with Tuesday's $278.20 close sitting below a 50-day average of $309.14.
Top Movers
Gainers
Penguin Solutions (PENG) rises 4.66% to $67.20. Fiscal fourth-quarter sales jumped 68% to $566.7 million and adjusted earnings of $1.00 a share beat the $0.77 consensus tracked by Investing.com. Guidance did more of the work: sales growth of 40%, plus or minus 10 points, for fiscal 2027 and adjusted earnings of $3.75 to $5.15 a share, against $2.87 in fiscal 2026.
Neogen (NEOG) gains 10.37% to $13.20 after raising its fiscal 2027 revenue outlook to $885 million to $890 million, from $880 million to $885 million.
Losers
Constellation Brands (STZ) falls 5.13% to $109.74 despite a quarterly beat. Comparable earnings of $3.74 a share topped the $3.61 consensus tracked by Investing.com and net sales rose 6% to $2.63 billion, but beer depletions, the measure of what distributors sell to stores, slipped 0.6%, with Modelo Especial down about 2% and Corona Extra about 5%. Management raised its reported earnings outlook to $11.85 to $12.55 from $11.50 to $12.20, yet only reaffirmed the comparable range of $11.20 to $11.90, whose $11.55 midpoint trails the $11.72 consensus Investing.com cites. It also bought the SpikedAde drinks brand for $75 million upfront.
Chip-equipment and memory names slide in step: Applied Materials (AMAT) 2.73% lower to $515.78, ASML (ASML) down 2.76% to $1,783.41, Lam Research (LRCX) off 2.81% to $324.50, KLA (KLAC) down 2.35% to $192.81 and Micron (MU) 2.83% lower to $1,015.97. UBS cut Dutch toolmaker BE Semiconductor to Sell from Buy, slashing its target to €159 from €370, a day after Bank of America downgraded it on delayed demand for high-bandwidth-memory equipment. Tokyo had already marked the group down, with Disco off 6.3%. KLA comes in carrying a 4.54% loss from Tuesday, when Morgan Stanley trimmed its target to $227 from $253.
Ciena (CIEN) gives back 3.53% to $428.00 after a 13.85% surge Tuesday, when Marvell's long-term targets for optical interconnect lifted the whole networking group.
Constellation Energy (CEG) eases 2.71% to $292.25 following Tuesday's 12.25% jump on its Google agreement: a 20-year contract for 890 megawatts of new nuclear capacity from upgrades to existing plants, a 15-year supply deal for 2,700 megawatts from its current fleet, and $4.3 billion of investment.
Macro Calendar
The Fed and the Treasury share the afternoon, and both speak to the same question about how high long-term yields can go.
| Time (ET) | Release | Consensus | Prior |
|---|---|---|---|
| 7:00 a.m. | MBA mortgage applications (week) | — | -6.0% |
| 10:30 a.m. | EIA crude inventories (week) | — | +0.92 million bbl |
| 1:00 p.m. | $39 billion 10-year note reopening | — | 4.834% high yield |
| 2:00 p.m. | FOMC minutes, September 15-16 meeting | — | — |
| 3:00 p.m. | Consumer credit, August | $14.4 billion (Investing.com) | $18.06 billion |
The September meeting produced the Fed's first rate increase in three years, and the minutes will show how many officials wanted a series rather than a single step. Markets have backed away fast: CME FedWatch puts the chance of an October hike at about 20.5%, down from roughly 51% a week ago, per Reuters, after softer readings on inflation and payrolls. Governor Christopher Waller and regional presidents Neel Kashkari and Alberto Musalem are also scheduled to speak today.
Earnings Today
Nothing notable reports before the opening bell. Two mid-sized names arrive after the close.
Levi Strauss (LEVI) is expected to earn $0.36 a share on revenue of $1.62 billion, per Benzinga's consensus, against $0.34 and $1.54 billion a year ago. Applied Digital (APLD), the data-center developer, reports fiscal first-quarter results with analysts looking for a loss of $0.30 a share on revenue of $132.16 million, per Benzinga Pro.
Drivers
- The ten-year auction at 1:00 p.m. and the minutes an hour later will be read together. With the ten-year at 5.27%, a weak sale of $39 billion would say buyers want still more compensation. Futures price a hike in October as unlikely, so the minutes matter most if they describe a committee leaning toward several increases. A soft auction followed by hawkish minutes is the combination that would test the S&P 500's hold on its 7,798.99 August high.
- Oil now carries both a war premium and a weather premium. Brent at $101.91 reflects Houthi strikes on Saudi targets and a storm heading for Gulf of Mexico platforms; the government's inventory report at 10:30 a.m. follows an industry estimate that showed a 2.09 million barrel draw.
- Samsung's preliminary results will set the tone for chip stocks Thursday. The LSEG SmartEstimate, based on 21 analysts, calls for operating profit of 106.1 trillion won, against 12.17 trillion won a year earlier.