The Nasdaq fell on Wednesday as doubts about a rate cut weighed on investors as they grappled with a busy day highlighted by earnings from Boeing Co. (BA) and Tesla Inc. (TSLA).
The Dow Jones Industrial Average (^DJI) fell more than 300 points (0.7%). The tech-heavy Nasdaq Composite Index (^IXIC) fell about 1%, and the benchmark S&P 500 (^GSPC) fell more than 0.6%.
Stock prices have stalled as investors debate how quickly the Federal Reserve will cut interest rates over the next year. Pessimism about the outlook for interest rates to remain high for an extended period of time has pushed bond prices lower in recent days, pushing the 10-year Treasury yield (^TNX) to its highest level since July. Yields rose slightly on Wednesday, staying firmly above the 4.20% level.
Tesla’s (TSLA) earnings, which will be released after the market closes, will be closely watched amid questions about the company’s much-anticipated low-cost EVs, details about its robotaxis, and its AI transition. More broadly, Wall Street is trying to determine whether Big Tech giants will continue to accelerate their share price gains and what the AI arms race will mean for their performance.
Several big tech companies lagged ahead of the report, with Apple (AAPL), Alphabet (GOOGL, GOOG), Amazon (AMZN), Meta (META), and Nvidia (NVDA) all down more than 1%. .
Read more: What Fed Rate Cuts Mean for Bank Accounts, CDs, Loans, and Credit Cards
Meanwhile, Boeing Co. (BA) posted a steep loss in its quarterly report before the bell on the same day it was determined whether striking factory workers had voted to accept the pay deal.
In corporate matters, McDonald’s (MCD) stock fell more than 4% after it was announced that the company’s Quarter Pounder Burger was officially linked to an outbreak of E. coli infections in some states. This weighed on the Dow.
Investors are wary of surprises after Starbucks (SBUX)’s shocking sales decline and guidance reversal. The coffee chain’s stock fell about 1%, recovering from a steep drop in after-hours trading.
LIVE10 update
AI could drive US stock market dominance for another decade
US stocks currently dominate global stock markets. A new forecast led by a project at JPMorgan Asset Management says the impact of artificial intelligence will not decline significantly over the next decade as it permeates the U.S. stock market.
In the firm’s 2025 long-term capital market assumptions released on Monday, the team predicted that the U.S. share of total global stock markets would fall to 60% in 2037 from 64% now. (green) will maintain a significant lead over China (red), which has the estimated second largest market share in the global stock market.
Monica Isar, global head of multi-asset and portfolio solutions at JPMorgan Wealth Management, told Yahoo Finance during a media roundtable on Monday that the benefits of artificial intelligence have dominated market gains over the past year. He said the U.S. advantage will continue as it expands beyond the few big technology companies that have done so. .
Isar said there are two drivers of the dominance of U.S. stocks: revenue generation and improving profit margins. The first will likely come from companies that are currently spending on AI elsewhere. This means that when tech companies buy AI chips from the likes of Nvidia (NVDA) and more power is needed, these AI operators spend money with companies in the utilities (XLU) and energy (XLE) sectors. It unfolds by being forced to do something.
Another catalyst, margins, comes from AI making companies more efficient, eliminating menial tasks and ultimately lowering costs. Isar added that the team feels “more comfortable about the dominance of U.S. stocks” because these effects spread to the 493 companies in the S&P 500 index rather than the Magnificent Seven.
“It’s primarily going to be the U.S. and then obviously Europe, because we’re starting to see adoption there,” Isar said.
Oil falls as US inventories rise, traders focus on Middle East conflict
Oil fell more than 1% on Wednesday as new data showed U.S. stockpiles soared as traders looked for signs of easing tensions in the Middle East.
West Texas Intermediate (CL=F) fell to over $70 per barrel, and Brent crude oil (BZ=F), the international benchmark price, hovered around $75.
The latest government data showed crude oil inventories rose by 5.5 million barrels last week, compared with analysts’ expectations for a 1 million barrel increase, according to Bloomberg data.
Wednesday’s price move came as Brent prices rose 4% in the past two sessions as traders focused on the continuing Middle East crisis in Gaza and Lebanon.
A lack of recent headlines about Israel’s plans to retaliate against Iran following the October 1 missile attack has also weighed on the market.
“Oil futures are under pressure as the news from Israel is not being taken as negative news for oil prices,” Dennis Kistler, senior vice president at BOK Financial, said on Wednesday. There is a possibility that it will be done.”
Magnificent 7 lags Tesla’s profits
Tesla (TSLA) earnings after the bell are scheduled to begin the first quarterly report from the Magnificent Seven technology group.
The group is leading the print market in pulling down the Nasdaq 100 (^NDX). Apple (AAPL), Alphabet (GOOGL, GOOG), Amazon (AMZN), Meta (META), and Nvidia (NVDA) all fell more than 1% on Wednesday.
Below you can see how the index is performing today.
Trump Media stock continues to rise
Trump Media and Technology Group stock (DJT) extended its double-digit gain from a day earlier to 4.5% as investors bet on former President Donald Trump’s improved odds of winning the November election. %, marking the highest level since July. Two weeks.
Yahoo Finance’s Alexandra Canal reports:
Shares of the company that operates Truth Social, the Republican candidate’s social media platform, have soared recently as domestic and international betting markets shift in favor of Trump’s victory, and shares of Polymarket, PredictIt, Calci and others have soared recently. All prediction sites are pointing to Trump winning. His presidential chances are ahead of Democratic candidate and current Vice President Kamala Harris.
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A tough day of news for Dow stocks.
It was a morning filled with bad news for the Dow Jones Industrial Average (^DJI) stock price. Major indexes are down about 0.5%, led by declines in 3M Company (MMM), Coca-Cola (KO), and McDonald’s (MCD).
Coca-Cola and 3M fell after both companies reported quarterly results. Although Coca-Cola’s quarterly sales and earnings per share both exceeded Wall Street expectations, shares of the soda giant’s stock price fell as profits were weaker than last year. Similarly, 3M’s earnings per share and sales beat analysts’ expectations, but its stock fell in early trading.
Meanwhile, McDonald’s was the Dow’s biggest laggard, dropping more than 5% on Wednesday. The Centers for Disease Control and Prevention said the company’s Quarter Pounder burger has been linked to E. coli outbreaks in some states, with the most outbreaks occurring in Colorado and Nebraska.
Existing home sales fall to lowest level in 14 years
Despite mortgage interest rates being eased in September, sales of existing homes declined as home seekers remained cautious about purchasing a home.
Existing home sales rose to a seasonally adjusted annual rate of 3.84 million units, down 1.0% from August’s tally, the National Association of Realtors said Wednesday. This is the lowest level since October 2010. Economists polled by Bloomberg had expected the pace for September to be 3.88 million.
Existing home sales in September fell 3.5% on an annual basis. The median home price increased 3.0% from last September to $404,500, marking the 15th consecutive month of annual price increases.
“Home sales have essentially been stuck at around 4 million units for the past 12 months,” NAR Chief Economist Lawrence Yun said in a press release.
There are significant challenges weighing on sales activity, including inventory shortages, soaring prices, and rising mortgage rates. But last month, those factors changed for the better.
The Federal Reserve lowered its benchmark interest rate by 0.5 percentage point in September. Central banks do not set mortgage rates, but their actions influence their direction.
Mortgage rates hit their lowest levels since February 2023 ahead of the Fed’s decision to ease, while publicly traded inventories rebounded.
But overall, that wasn’t enough to attract buyers.
“Some consumers are hesitant to make major expenditures such as buying a home before the next election,” Yun said.
Boeing reports $6 billion in quarterly losses, big union vote looms
Boeing (BA) shares fell nearly 1% on Wednesday after the aircraft maker reported another significant quarterly net loss ahead of a key Labor vote scheduled for later in the day.
Yahoo Finance’s Pras Subramanian reports:
Boeing reported a net loss of $6.17 billion, bringing its total losses so far in 2024 to nearly $8 billion. Operating cash flow was negative $1.34 billion. The company reported sales of approximately $17.8 billion, down approximately 1% from the same period last year. This figure was roughly in line with preliminary figures released last week.
Boeing said its operating cash flow reflected “lower commercial widebody aircraft deliveries and unfavorable working capital timing, including the impact of the IAM work stoppage.” A year ago, Boeing’s operating cash flow was $22 million.
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Dow leads losses as it approaches
The Dow Jones Industrial Average led the decline in U.S. stocks on Wednesday as doubts about a rate cut weighed on investors preparing for a busy earnings day with Boeing Co. (BA) and Tesla Inc. (TSLA) all in the spotlight.
The Dow Jones Industrial Average (^DJI) fell more than 250 points (0.6%). The tech-heavy Nasdaq Composite Index (^IXIC) fell by about 0.5%, while the benchmark S&P 500 Index (^GSPC) fell by more than 0.3%.
Earnings summary: Boeing’s big deficit, AT&T’s surprise and more
On Wednesday morning, another major company announced its earnings results.
The spotlight was on troubled aircraft maker Boeing (BA), which is facing a critical union vote later today that will determine whether its workers continue their month-long strike. reported a loss of $. Boeing shares were down less than 1% in premarket.
Meanwhile, AT&T (T) shares rose 3% after the telecom giant reported higher-than-expected wireless subscriber numbers and better-than-expected third-quarter profits.
TransUnion (TRU), one of the three largest credit unions, beat expectations and rose 2.4%.
Meanwhile, Coca-Cola (KO) fell 1.5% despite mostly positive press. Hotel giant Hilton (HLT) fell 3.5% following the results.
Below you can see how the group performed compared to Wall Street’s expectations (according to Bloomberg consensus estimates).
Coca-Cola: Adjusted earnings per share of $0.77 vs. $0.74 expected; adjusted net operating revenue of $11.85 billion vs. $11.61 billion expected.
AT&T: Adjusted EPS of $0.60 vs. $0.57 expected, revenue of $30.21 billion vs. $30.45 billion expected.
Boeing: Adjusted loss per share of $10.44 vs. $10.31 expected; revenue of $17.84 billion vs. $17.89 billion expected.
Hilton: Adjusted EPS of $1.92 vs. $1.84 expected, net revenue of $2.87 billion vs. $7.92 billion expected.
TransUnion: Adjusted earnings per share of $1.04 vs. $1.02 expected, revenue of $1.09 billion vs. $1.06 billion expected.
Starbucks (SBUX) also released preliminary quarterly results on Tuesday, which sent shockwaves through the streets and sent the stock down about 3.5% in Wednesday’s premarket.
Tesla (TSLA), T-Mobile (TMUS), and IBM (IBM) will announce their financial results after the session ends.
good morning. Here’s what happened today:
Economic data: MBA home loan applications (week ending October 18). Existing Home Sales (September); Federal Reserve Beige Book
Revenue: Tesla (TSLA), Boeing (BA), AT&T (T), IBM (IBM), Coca-Cola (KO), GE Vernova (GEV), T-Mobile (TMUS), Las Vegas Sands (LVS), Hilton Worldwide Holdings (HLT), Whirlpool Corporation (WHR), Mattel (MAT), CME Group (CME), General Dynamics (GD), ServiceNow (NOW), Viking Therapeutics (VKTX)
Here are some of the biggest stories you may have missed throughout the night and early this morning.
Boeing posts huge quarterly losses, union vote looms
McDonald’s slumps due to E. coli outbreak and Quarter Pounder
Coca-Cola announces results that exceed third-quarter profit amid rising prices
Qualcomm uses chip design intellectual property, leading to intensifying conflict
Oil falls as traders focus on US stockpiles and the Middle East
Nvidia CEO: Blackwell AI chip design flaw fixed
