Market Wrap
Published
The S&P 500 slipped 0.2% even as the data backdrop turned more favorable, with second-quarter GDP running at 2.2% against a 1.5% estimate, core PCE cooling to 3.3% versus 3.6% expected, and September nonfarm payrolls beating at 90,000. Traders pared bets on an October Fed hike on the numbers, but equities still finished lower, weighed down by financials, health care and industrials even as technology held up.
Financials (XLF) fell 1.0%, the weakest showing came from Fidelity National Financial, down 6.0%, while Robinhood dropped 3.1% and Goldman Sachs and Morgan Stanley each lost more than 1.5%. Cboe Global Markets was the standout gainer in the group, up 5.2% after signing a 25-year extension of its S&P 500 options licensing deal with S&P Dow Jones Indices. Health Care (XLV) lost 1.4%, led lower by Moderna's 5.4% decline following the appointment of Juan Andres as chief operating officer, with Eli Lilly, Abbott and Merck all down more than 2%. Industrials (XLI) fell 1.3%, dominated by the Boeing-Northrop Grumman divergence after the Pentagon awarded Boeing the Navy's F/A-XX fighter contract worth more than $20 billion; Northrop fell 4.1% on the loss. Consumer Staples (XLP) dropped 1.5%, with General Mills down 4.9% even as it named Dana McNabb to succeed Jeff Harmening as CEO, and Conagra Brands falling despite beating EPS estimates and reaffirming fiscal 2027 guidance. Technology (XLK) was the lone bright spot, up 0.6%, led by Gen Digital (+5.6%), Synopsys (+4.8%) and Intel (+3.6%), while Micron slipped 0.3% after reporting fiscal fourth-quarter EPS of $33.42 and guiding first-quarter revenue to about $61.5 billion.
Jabil fell 9.7% despite beating fiscal fourth-quarter estimates and guiding full-year revenue up 24%, and Applovin dropped 4.9%. Fair Isaac lost 3.5% and Kroger fell 3.5%. On the upside, Rambus rose 3.7%, Paramount Skydance gained 3.5% and Huntington Ingalls added 3.1%.
Oil-linked names diverged from the broader tape, with the Brent oil ETF up 2.2% as diesel futures jumped 4.5% after an EIA report showed a record in US crude production alongside rising Cushing inventories. The 30-year mortgage rate climbed to 7.3%, the highest since November 2023, and mortgage applications fell 6.0% for the week. Gold extended gains after the PCE data, last quoted up 0.6% near $4,206 an ounce, while the euro traded near its weakest level since May 2025 against the dollar.
Geopolitical headlines stayed in the background for markets but remained active: Trump confirmed the withdrawal of the last US forces from Iraq, ending Operation Inherent Resolve, while Israeli officials described a security incident aboard a flydubai flight from Dubai as an attempted attack. In Europe, Italy's bond risk premium topped 100 basis points for the first time since March and France's premium reached 120 basis points, a level last seen in 2012, after ECB President Lagarde called France's debt load "serious" with no clear path lower.