After six consecutive weeks of gains, the S&P 500 took a breather, dropping 1.0%. The Dow Jones felt a sharper sting, declining 2.7%. I’ve seen this pattern before – markets rarely move in straight lines. The profit-taking wasn’t surprising, especially with Treasury yields climbing higher.
The 10-year yield jumped 16 basis points to 4.23%.The bright spot? The Nasdaq Composite managed to eke out a 0.2% gain, thanks to our tech heavyweights and semiconductor stocks. Tesla’s impressive Q3 earnings and optimistic 2025 forecast gave the sector a nice boost.
US Market Highlights
The housing market caught my attention this week. Sales have hit their lowest point since 2010 – a situation I haven’t seen since the aftermath of the financial crisis. Here’s what’s fascinating: despite the sales slump, median home prices still rose 3% to $404,500.Some notable corporate moves:
- Boeing is exploring selling its space division, including the Starliner program
- Tapestry’s planned $8.5B merger with Capri hit a judicial roadblock
- McDonald’s faced challenges with an E. coli outbreak
- Peloton made a smart move partnering with Costco
Fun fact: Did you know that historically, companies that increase their dividends have outperformed their peers by an average of 2.5% annually? Speaking of performance…
Global Highlights
The international scene is giving us plenty to analyze. China cut key lending rates by 25 basis points – a move I’ve been anticipating given their economic challenges. The Bank of Canada surprised many with a 50-basis-point cut, bringing rates to 3.75%.
The Eurozone continues to struggle with stagnation. As someone who’s watched European markets for over two decades, I see echoes of past cycles here. The weak output from Germany and France particularly concerns me.
Commodities & Crypto Corner
Oil prices tell an interesting story. Despite Middle East tensions, Brent and WTI crude prices dropped to $73.80 and $69.70 respectively. I’ve learned over the years that fundamentals usually win over geopolitics in the long run.
The real showstopper? Gold hitting an all-time high above $2,700.
In the crypto space, Bitcoin is flirting with $68,000, while Ethereum sits at $2,615. The correlation some analysts are drawing between Bitcoin’s price and Donald Trump’s election prospects adds an intriguing political dimension to crypto markets.
Calendar
Next week promises to be action-packed. We’re getting earnings reports from tech giants representing $12 trillion in market cap:
- Apple
- Microsoft
- Amazon
- Alphabet
- Meta
Key economic data to watch:
- Q3 GDP (Wednesday)
- PCE price index (Thursday)
- October jobs report (Friday)
The Fed meeting in November looks interesting – market participants are pricing in a 95% chance of a 25-basis-point rate cut. In my experience, these consensus expectations often lead to surprising market reactions when they don’t materialize exactly as predicted.
I’ll be watching these developments closely, particularly how the “Magnificent Seven” earnings might influence market sentiment. Remember, markets often react more to expectations than actual numbers – something I’ve learned through countless earnings seasons.
