Morning Briefing
Published
S&P 500 futures are little changed, with the index caught between easing Middle East tension and a bond market that keeps grinding against risk appetite. Iran's foreign minister Araqchi has told Tehran's cabinet he received a formal US proposal, and Qatar has floated a fresh plan seeking concessions from both sides, but reports of an explosion in Zahedan and two flydubai flights diverting away from Tel Aviv show the Hormuz standoff is far from resolved.
The bigger overhang is rates. The 30-year Treasury yield has pushed above 5.6%, its highest since 2002, and the 30-year mortgage rate has jumped to 7.3%, the highest since November 2023, as mortgage applications fell for a second straight week. Fed officials remain split: Governor Barr and Chicago's Goolsbee have both pushed back on looking through the energy-driven inflation shock, while New York's Williams sounded less urgent about further hikes, a divide that has left traders trimming bets on an October move to roughly even odds.
Energy is the standout sector, up 0.5%, even as OPEC+ delegates signal quotas will hold steady for November and Russia extends its diesel export ban through October. Industrials are split sharply following Boeing's win of the Navy's F/A-XX fighter contract. Health Care is roughly flat, masking a steep drop in Moderna. Technology is little changed, with HP Enterprise the standout gainer on a networking guidance raise.
Company News
- Boeing rises after securing the Navy's F/A-XX carrier fighter contract, worth more than $20 billion, while Northrop Grumman falls sharply after losing the bid.
- HP Enterprise gains after lifting its fiscal 2027 Networking revenue growth outlook and raising its Juniper cost-synergy target to $800 million, alongside disclosing a $1.2 billion AI systems order from Vultr.
- Jabil beat on both earnings and revenue and guided full-year fiscal 2027 revenue up 24%, but shares are lower.
- Conagra Brands topped profit expectations and reaffirmed its fiscal 2027 outlook.
- Hormel Foods agrees to buy Brakebush Brothers for roughly $1.055 billion in cash.
- Moderna names Juan Andres as Chief Operating Officer as the stock slides.
- Norwegian Cruise Line says third-quarter results will beat prior guidance and reaffirms its full-year outlook.
- General Mills elevates Dana McNabb to CEO effective January 1, succeeding Jeff Harmening.
- Cigna reaffirms 2026 guidance and lays out new targets through 2030, including 10-14% adjusted EPS growth.
Overseas Data
Japan's August industrial output fell 1.7% versus an expected rise, while retail sales grew a softer-than-expected 2.7% year-on-year. China's September manufacturing PMI matched expectations at 50.1.
Germany's preliminary September inflation came in at 3.3% year-on-year, above consensus, while France's harmonized CPI rose 3.4%, also hotter than expected, adding to signs that the energy shock is feeding through to European price pressure. UK second-quarter GDP beat at 0.5% quarterly, with business investment up 5.2% year-on-year, well above forecasts.