Weekly Market Recap:
This week, U.S. equities were mixed, with the Dow rising +0.15%, the S&P 500 gaining +1.37%, and the Nasdaq up +1.50%, while the Russell 2000 edged higher at +0.10%. Notable gains in big tech marked the Nasdaq’s seven-week streak, although Apple and Microsoft’s results tempered enthusiasm. Airlines, media, and small-caps outperformed, while energy, semiconductors, and REITs lagged. Treasuries continued to weaken, with higher yields across the curve. The dollar index was little changed, while gold dipped slightly, down -0.2% after recent gains. WTI crude saw a decline of -3.2%, influenced by concerns over Middle East tensions and supply dynamics.
Corporate Highlights:
Apple (3.5%) exceeded iPhone sales expectations but offered cautious December guidance.
Microsoft (4.2%) posted strong earnings led by AI growth, although it projected slower Azure growth.
Amazon (5.4%) reported positive Q3 results with significant margin expansion.
Meta (1.1%) continued to see gains in AI initiatives but faced questions on elevated spending.
Outlook for Next Week:
Investors will focus on Election Day on Nov 5, as political outcomes could impact fiscal sentiment. The FOMC meets on Nov 7, with markets anticipating a 25bp cut, driven by easing expectations. Over 100 S&P firms will report Q3 results, including Alphabet and Meta, while economic indicators like ISM Services and Michigan Consumer Sentiment may provide further insight into the economy's resilience heading into Q4.
October’s employment report brought disappointing news, as the U.S. added just 12,000 jobs, marking the weakest monthly gain since 2020 and falling well short of the anticipated 100,000. This low number reflects the disruptive impacts of recent hurricanes in the Southeast and a prolonged labor strike at Boeing. Manufacturing bore the brunt of these challenges, shedding 46,000 jobs, with an estimated 44,000 directly tied to the Boeing strike. Despite the minimal job gains, the unemployment rate held steady at 4.1%, matching expectations. Health care and government provided some positive movement, adding 52,000 and 40,000 positions, respectively. However, other sectors struggled, with declines in leisure, hospitality, and temporary help services. The latter, often seen as a gauge of underlying labor strength, has continued a downward trend since March 2022. This complex employment landscape complicates the Federal Reserve’s approach to monetary policy. With inflation showing signs of easing, the Fed had already cut rates in September to bolster the economy. Now, this weaker-than-expected jobs report places additional pressure on the central bank as it considers another rate cut in its upcoming meeting. Analysts remain cautiously optimistic, suggesting that these setbacks may be temporary. As the effects of the Boeing strike and recent hurricanes fade, the coming months will be crucial in assessing whether the economy can regain hiring momentum or if underlying challenges in the labor market will persist. This report underscores the unpredictable nature of the labor market, which remains affected by both economic and environmental factors.
NEXT WEEK: Notable Earnings:
Monday (11/4)
Marriott International Inc. ($MAR)
Goodyear Tire & Rubber Co. ($GT)
Realty Income Corp. ($O)
Tuesday (11/5)
Ferrari N.V. ($RACE)
B&G Foods Inc. ($BGS)
Wednesday (11/6)
Tripadvisor Inc. ($TRIP)
Beyond Meat Inc. ($BYND)
Virgin Galactic Holdings ($SPCE)
Thursday (11/7)
Yelp Inc. ($YELP)
Krispy Kreme Inc. ($DNUT)
Airbnb Inc. Cl A ($ABNB)
Friday (11/8)
Compagnie Financiere Richemont S.A. ($CFRHF)
Notable Ex-Dividend Dates:
Monday (11/4)
Citigroup ($C) 3.60%
Tuesday (11/5)
MetLife ($MET) 2.62%
Sirius XM ($SIRI) 3.97%
Wednesday (11/6)
Southern Copper Co. ($SCCO) 2.10%
Brown & Brown, Inc. ($BRO) 0.57%
Thursday (11/7)
Ford Motor ($F) 5.80%
Hess Midstream LP ($HESM) 7.70%
Friday (11/8)
Charles Schwab ($SCHW) 1.39%
Unilever (UL) 2.90%
Wells Fargo & Company (WFC) 2.46%
*Dividend Aristocrat
