Morning Briefing
Published
S&P 500 futures point to a modestly lower open, down 0.2%, as a wave of earnings offsets a market still absorbing the standoff in the Strait of Hormuz. WTI held near $103.78 after Monday's advance, Treasury yields sit at 5.14%, and gold has slipped toward $4,130 an ounce as inflation concerns from elevated oil prices weigh on the metal's appeal. Europe's gas benchmark has broken above €90 for the first time since 2022, and Iran's Strait of Hormuz Management Organization has now added 122 ships to a non-compliance list, even as a UK Maritime Trade Operations report flagged a tanker incident roughly 121 nautical miles east of Duqm, Oman.
Diplomacy is running on two tracks. Pakistan's Army Chief has arrived in Tehran with a delegation, while Iran's foreign ministry says US "excessive demands" are hindering negotiations and separately objects to Egypt's readiness to help Saudi Arabia against the Houthis. The UK says it will fly missions to defend Saudi Arabia from Houthi attacks but has told its government it does not accept being drawn into the Saudi-Houthi war. On the supply side, the French Presidency says Bahrain, the UAE and Saudi Arabia will each ship diesel to France monthly starting in coming weeks, and IEA head Fatih Birol says the agency would consider releasing more oil from emergency stocks if needed.
Energy is the clear sector leader pre-market, led by Halliburton after it posted a Q3 beat, while Technology is the weak spot as semiconductor names give back Monday's gains. SK hynix is down nearly 5% and a cluster of AI-infrastructure names, including CoreWeave, CAE and Nebius Group, are all down more than 3%, following pushback from China's Foreign Ministry on US efforts to restrict DeepSeek tools in government systems.
Company News
- Northrop Grumman beat on EPS and raised full-year operating income, EPS and free cash flow guidance.
- RTX reported Q3 EPS of $2.26, well above expectations, and raised full-year sales, EPS and free cash flow guidance on a record $340 billion backlog.
- GE Aerospace beat estimates and raised full-year revenue growth, operating profit, EPS and free cash flow guidance.
- General Motors reported Q3 EPS of $3.70, slightly below expectations, narrowed full-year guidance, and approved a new $20 billion buyback.
- 3M beat on EPS, raised full-year sales and EPS guidance, and is up sharply pre-market on its expanded Amazon commercial relationship.
- Hasbro posted a large EPS beat and raised its full-year revenue, margin and EBITDA outlook, citing Magic: The Gathering topping $600 million in quarterly revenue.
- Equifax beat on EPS but cut revenue guidance on a weaker mortgage market, and shares are among the morning's worst performers.
- MSCI is up sharply pre-market after a steep after-hours jump.
- KeyCorp and Ally Financial both reported mixed quarters, with KeyCorp beating and Ally missing slightly.
- Prudential Financial agreed to sell its Brazil and Mexico units to CNP Assurances for roughly $4.025 billion.
- Kimberly-Clark priced $4.9 billion in notes to help fund its Kenvue acquisition.
- Tradeweb Markets agreed to acquire Trumid Holdings for about $1.97 billion.
- Qualcomm plans global job cuts following a performance-focused review.
- Steel Dynamics is the sharpest decliner in pre-market trading, extending Monday's after-hours slide.
Overseas Data
UK unemployment came in at 4.7% in August, below the 4.9% expected, while average weekly earnings rose 3.7% year over year, slightly under consensus, and employment rose 102,000 over three months, far above the 5,000 expected.
Germany's October Zew current conditions index improved to -35.9, better than the -44.5 expected. Spain's August trade deficit widened to €7.813 billion, and Switzerland's real imports rose 7.0% month over month in September.
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