Morning Briefing
Published
S&P 500 futures point to a modestly higher open, up roughly 0.2%, as big bank earnings offset an escalating standoff in the Strait of Hormuz. Energy and Financials are the strongest pre-market sectors while Technology lags, with hardware and chip names under pressure.
The Hormuz crisis deepened overnight. Iran's Revolutionary Guard Navy says a container ship carrying 2,500 containers sank after striking a naval mine during what Tehran called an "unauthorized" transit, and a drone strike injured three people aboard a fishing vessel near the strait. Houthi forces claim fresh strikes on Aramco's Dhahran complex, King Khalid Airport, and a Riyadh refinery, and say attacks on Saudi oil infrastructure will continue. A Saudi-led coalition intercepted a separate missile aimed at Riyadh, while Oman, Russia, and China are reportedly mediating ceasefire talks with the Houthis. Oman separately says any Hormuz resolution depends on direct US-Iran talks. The IEA projects 2026 global oil demand falling 2.6 million barrels a day on war disruption, supply dropping 5.8 million barrels a day, and a resulting deficit of 1.73 million barrels a day, warning the escalation threatens the recent recovery in Middle East exports.
On policy, Fed Governor Bowman said she sees no immediate need for further rate action and described plans for a broader Fed reorganization tied to risk-culture issues exposed by the Silicon Valley Bank collapse. Markets continue pricing high odds of a December hike as investors await fresh US inflation data.
Company News
- BlackRock posted Q3 EPS of $15.93, well above expectations, on revenue of $7.75 billion, with 11% annualized organic base fee growth and $550 million in buybacks; shares lead the financial sector pre-market.
- Bank of America reported Q3 EPS of $1.08, missing estimates, with revenue of $30.10 billion versus $31.32 billion expected, as investment banking and trading revenue declined; the stock is the sector's worst performer following a $1.2 billion money-laundering fine and a separate $11.66 million OFAC sanctions settlement.
- State Street reported Q3 EPS of $3.69, slightly ahead of expectations, returned $651 million to shareholders, and agreed to acquire Santander's CACEIS Latin America Securities Services joint venture, though shares are sharply lower.
- Morgan Stanley posted Q3 EPS of $3.03, missing estimates, with revenue of $20.34 billion versus $20.87 billion expected, though Wealth Management posted record revenue and $232 billion in net new assets.
- Fastenal reported Q3 EPS of $0.35, narrowly topping estimates, but lowered its 2026 device-signing targets.
- Accenture held its Investor Day, guiding to mid-single-digit revenue growth for fiscal 2027 and 2028 and at least $9.5 billion returned to shareholders in fiscal 2027; shares are among the premarket's top gainers.
- Cirrus Logic confirmed it made acquisition proposals for Synaptics but said it is not currently pursuing a deal.
Overseas Data
China's September CPI rose 0.9% year-on-year, just under consensus, while PPI jumped 5.0%, well above the 4.4% forecast. New yuan loans for the January-September period reached 11.52 trillion yuan, above expectations.
Germany's September wholesale price index rose 8.7% year-on-year, accelerating sharply from 6.8% in August, while Finland's CPI rose to 2.5% and India's wholesale inflation surged to 11.39%, both above prior readings and forecasts.