[BRIEFING.COM] The stock market finished broadly lower on Friday, with the S&P 500 (-0.5%), Nasdaq Composite (-0.2%), and DJIA (-1.2%) all ending in negative territory. The relatively modest losses for the S&P 500 and Nasdaq Composite masked a considerably weaker showing beneath the surface, as strength in select technology stocks and the energy sector provided limited support against widespread selling pressure. The session marked another reversal in market leadership following Thursday's sharp technology-led selloff, contributing to a mostly lower finish for the week.

The market opened under pressure before a modest rebound in technology stocks helped the major averages recover from their early lows. The Nasdaq Composite briefly moved into positive territory, although the recovery eventually lost momentum as selling pressure across both cyclical and defensive sectors intensified. The DJIA remained firmly lower throughout the session, while the equal-weighted S&P 500 (-0.8%) also underperformed, reflecting the broad nature of the weakness.

Surging crude oil prices were a central influence on Friday's trading. WTI crude futures settled $3.72 higher (+3.7%) at $103.17 per barrel amid renewed concerns about an escalation in hostilities between the United States and Iran. The advance accounted for the bulk of crude oil's approximately $3.90 gain for the week, adding to concerns about inflation and corporate input costs. The energy sector (+2.5%) was Friday's strongest performer and finished the week with a 1.6% gain, the best showing among the 11 S&P 500 sectors.

The information technology sector (+0.4%) also finished higher, although the PHLX Semiconductor Index (+0.4%) recovered only a fraction of Thursday's 6.7% decline. Software stocks provided more meaningful support, with the iShares Expanded Tech-Software Sector ETF (IGV) gaining 1.7% and Palo Alto Networks (PANW 380.55, +25.63, +7.22%) and CrowdStrike (CRWD 257.57, +19.63, +8.25%) ranking among the best-performing S&P 500 components. The divergence between software and semiconductor stocks has been a notable feature of this week's trading, reflecting continued scrutiny of the AI infrastructure buildout.

Those concerns were also evident in earnings reactions. Bloom Energy (BE 193.09, -24.68, -11.33%) faced substantial selling pressure despite reporting strong revenue growth and raising its FY26 outlook, as investors focused on negative free cash flow and expansion costs. Western Digital (WDC 343.67, -10.52, -2.97%) also struggled despite better-than-expected results and upbeat guidance, while Comfort Systems (FIX 1159.99, -119.38, -9.33%)declined following its earnings report.

Outside technology and energy, the real estate sector (+0.2%) was the only other S&P 500 sector to finish higher.

The remaining eight sectors declined, including the consumer staples (-1.8%) and health care (-1.1%) sectors, which surrendered some of their recent defensive outperformance. The reversal underscored the considerable shifts in market leadership throughout the week.

The communication services sector (-1.4%) faced pressure from mega-cap weakness and declines among traditional wireless providers. AT&T (T 20.94, -1.80, -7.94%), Verizon (VZ 44.61, -0.59, -1.31%), and T-Mobile US (TMUS 146.61, -12.18, -7.67%) came under selling pressure following a Bloomberg report that SpaceX (SPCX 147.49, +2.74, +1.89%) is seeking access to at least 80,000 U.S. cell sites, potentially positioning the company to become a fourth nationwide wireless carrier.

Economically sensitive stocks also struggled amid rising oil prices, with the consumer discretionary (-1.4%) and industrials (-1.3%) sectors finishing with sizable losses. The financials sector (-1.3%) was another notable laggard, weighed down in part by American Express (AXP 313.20, -11.98, -3.68%). Despite exceeding adjusted EPS expectations and raising the lower end of its FY26 earnings outlook, the company reported a slight revenue miss and slowing billed business growth. Rising customer-benefit costs also drew attention, while CNBC reported that American Express plans to eliminate approximately 5% of its global workforce.

Friday's decline capped a volatile week characterized by sharp shifts in market leadership, with relatively modest weekly changes in the major averages obscuring much larger moves among individual groups. Looking ahead, the third-quarter earnings season will accelerate further next week, with results from Amazon (AMZN 248.00, -2.38, -0.95%), Microsoft (MSFT 524.51, +3.43, +0.66%), and Alphabet (GOOG 317.28, -3.48, -1.08%) likely to draw particular attention as investors assess AI spending commitments and the prospects for returns on those investments.

U.S. Treasuries retreated on Friday after their big Thursday rally, though even with today's losses across the curve, the complex still secured its third consecutive weekly gain. The 2-year note yield settled up four basis points to 4.68% (-6 basis points this week), and the 10-year note yield settled up four basis points to 4.99% (-11 basis points this week). 

• Russell 2000: +11.9% YTD
• Nasdaq Composite: +11.8% YTD
• S&P 500: +11.4% YTD
• S&P Mid Cap 400: +9.4% YTD
• DJIA: +8.6% YTD

Reviewing today's data:

• The final reading for the University of Michigan Consumer Sentiment Index for October increased to 48.0 (Briefing.com consensus: 46.3) from the preliminary reading of 46.3. The final reading for September was 48.1. In the same period a year ago, the index stood at 53.6.
  
  • The key takeaway from the report is that consumers remain concerned about higher prices reducing their purchasing power.
• The S&P Global U.S. Manufacturing PMI hit 56.0 in the flash reading for October, up from 55.9 in September.
• The S&P Global U.S. Services PMI hit 57.9 in the flash reading for October, down from 58.8 in September.

[BRIEFING.COM] The major averages remain under pressure entering the final half hour of trading, with the S&P 500 (-0.5%), Nasdaq Composite (-0.2%), and DJIA (-1.1%) all on track for a mostly lower finish to the week. The losses reflect a volatile stretch of trading marked by sharp shifts in market leadership, renewed scrutiny of AI-related investments, and rising geopolitical tensions.

Looking ahead, the third-quarter earnings season will accelerate further next week, with results from Amazon (AMZN 248.29, -2.09, -0.83%), Microsoft (MSFT 523.92, +2.84, +0.55%), and Alphabet (GOOG 317.94, -2.81, -0.88%) among the most closely watched. Their reports will be particularly important in shaping expectations for AI infrastructure spending and determining whether the recent selling pressure in technology stocks persists.

[BRIEFING.COM] The major averages remain lower across the board heading into the final hour of trading, with rising oil prices continuing to weigh on market sentiment.

WTI crude futures settled today's session $3.72 higher (+3.7%) at $103.17 per barrel, bringing their gain for the week to approximately $3.90, with the bulk of that advance occurring today amid heightened geopolitical tensions.

The energy sector (+2.5%) continues to outperform and is on pace to finish the week with a 1.5% gain, the strongest week-to-date performance among the 11 S&P 500 sectors.

[BRIEFING.COM] The S&P 500 (-0.4%) remains in negative territory under the weight of losses in nine sectors with five groups down 1.0% or more. With today's loss, the benchmark index is on course to lose 0.4% for the week, somewhat masking the volatility that has impacted AI-related names earlier this week.

Even the top-weighted technology sector (+0.5%) is down just 0.1% for the week, thanks to this week's outperformance in software names, evidenced by the 5.9% week-to-date gain in the iShares Expanded Tech-Software Sector ETF (IGV 110.62, +1.90, +1.75%). Thanks to this week's rally, the ETF is now up 4.7% for the year after being down 30.1% for the year in early April.

Chip stocks are seeing some strength today but the PHLX Semiconductor Index (+0.8%) is still down 2.9% for the week and down 14.3% for the month. The group is still up an impressive 53.0% for the year, but down sharply from its 106.9% year-to-date gain in late June.

[BRIEFING.COM] Selling interest remains broad this afternoon, marking a reversal from yesterday's broader buying interest. The equal-weighted S&P 500 (-0.7%) is underperforming, showing that weakness beneath the headline averages is more pronounced than the cap-weighted S&P 500 suggests. The Nasdaq Composite remains near its flat line, while the DJIA continues to lag.

The S&P 500 consumer staples sector is down 2.0%, followed by financials (-1.3%), consumer discretionary (-1.2%), industrials (-1.1%), health care (-1.1%), and utilities (-0.9%). The losses across cyclical and defensive sectors underscore the lack of broad participation in the technology-driven relative strength.

WTI crude futures have extended their advance to 3.7% at $103.11 per barrel, near their session high. The move keeps inflation and input costs in focus.

Separately, the Department of Energy authorized an emergency exchange of up to 400,000 barrels from the Strategic Petroleum Reserve to address a supply disruption affecting the Phillips 66 (PSX 284.48, -0.14, -0.05%) Lake Charles refinery.

[BRIEFING.COM] The S&P 500 (-0.4%), Nasdaq Composite (-0.1%), and DJIA (-1.2%) are lower just after midday.

The information technology sector (+0.2%) remains one of only two S&P 500 sectors to hold a gain at this juncture, with the tech rebound contributing to the Nasdaq Composite's relative outperformance. While semiconductors and other AI-infrastructure stocks are recovering a sliver of yesterday's weakness, the PHLX Semiconductor Index (+0.6%) is off its earlier highs.

However, software stocks are putting together a solid showing, with the iShares U.S. Expanded Tech-Software ETF up 1.5% as Palo Alto Networks (PANW 377.56, +22.64, +6.38%) and CrowdStrike (CRWD 252.05, +14.11, +5.93%) are among the top-performing S&P 500 components. The software ETF is up 5.6% for the week, compared to a 3.1% loss for the PHLX Semiconductor Index.

[BRIEFING.COM] The stock market is showing a mixed performance at midday, with the S&P 500 (-0.2%) holding a modest loss, the Nasdaq Composite (+0.2%) trading slightly higher, and the DJIA (-0.9%) lagging by a considerable margin. Today's action reflects another shift in market leadership following yesterday's sharp technology-led selloff, with a modest recovery in AI-related stocks contrasting with weakness across much of the broader market.

The information technology sector (+0.7%) is among the few areas showing strength, supported by a rebound in semiconductor stocks. The PHLX Semiconductor Index (+1.2%) has recovered a small portion of yesterday's 6.7% decline, although the group remains firmly lower for the week. The relatively subdued rebound suggests investors are still approaching the AI trade cautiously following the latest earnings reports, which raised concerns about the costs and near-term growth prospects of infrastructure expansion.

Those concerns remain evident in some of today's earnings reactions. Bloom Energy (BE 192.24, -25.53, -11.72%)has faced substantial selling pressure despite reporting strong revenue growth and raising its FY26 earnings and revenue outlook. Investors have instead focused on negative free cash flow and the costs associated with expanding production capacity. Western Digital (WDC) has also struggled despite better-than-expected earnings and upbeat guidance, as concerns about higher capital spending and the sustainability of AI-related demand temper enthusiasm for its improving pricing and profitability.

Meanwhile, surging crude oil prices are creating a significant headwind for economically sensitive stocks. WTI crude futures are up $3.43 (+3.5%) to $102.91 per barrel amid renewed concerns about an escalation in hostilities between the United States and Iran. The energy sector (+3.0%) is leading the S&P 500 standings, while the consumer discretionary (-1.1%), industrials (-1.1%), and financials (-1.1%) sectors are facing substantial pressure as higher energy costs add to concerns about the economic outlook.

The DJIA's underperformance also reflects company-specific weakness, particularly in American Express (AXP 313.67, -11.50, -3.54%), which is among the index's biggest laggards following its quarterly earnings report. Despite exceeding adjusted EPS expectations and raising the lower end of its FY26 earnings outlook, the company reported a slight revenue miss and slowing billed business growth. Rising customer-benefit costs have also raised questions about underlying profitability, while CNBC reported that the company plans to eliminate approximately 5% of its global workforce.

Elsewhere, yesterday's defensive leaders are surrendering some of their recent gains, with the consumer staples (-1.8%), health care (-0.9%), and utilities (-0.7%) sectors all trading lower. The reversal highlights the considerable churn in market leadership this week, as investors have alternated between technology stocks and defensive areas rather than establishing a sustained preference for either group.

Despite yesterday's steep losses in technology stocks and today's broader weakness, the major averages remain relatively close to their levels at the start of the week. The shifting leadership has helped limit the market's overall decline, although the combination of renewed geopolitical uncertainty, elevated oil prices, and lingering questions about AI investment returns continues to complicate efforts to establish a more durable advance as more mega-cap earnings loom next week.

Reviewing today's data:

• Oct S&P Global U.S. Manufacturing PMI - Prelim 56.0 (Prior 55.9)
• Oct S&P Global U.S. Services PMI - Prelim 57.9 (Prior 58.8)
• The final reading for the University of Michigan Consumer Sentiment Index for October increased to 48.0 (Briefing.com consensus: 46.3) from the preliminary reading of 46.3. The final reading for September was 48.1. In the same period a year ago, the index stood at 53.6.
  
  • The key takeaway from the report is that consumers remain concerned about higher prices reducing their purchasing power.

[BRIEFING.COM] The major averages continue to show a mixed performance shortly after midday, with the S&P 500 (-0.3%) and DJIA (-1.0%) trading lower while the Nasdaq Composite (+0.1%) holds a modest gain.

SpaceX (SPCX 147.51, +2.76, +1.91%) is moving higher following a Bloomberg report that the company is seeking access to at least 80,000 U.S. cell sites, potentially laying the groundwork to become a fourth nationwide wireless carrier. The development is weighing on established wireless providers, including AT&T (T 21.43, -1.31, -5.77%), Verizon (VZ 44.56, -0.64, -1.42%), and T-Mobile US (TMUS 149.92, -8.87, -5.59%), amid concerns about increased competition for subscribers and pricing pressure. The proposed expansion would combine terrestrial wireless infrastructure with SpaceX's existing Starlink satellite network and recently acquired spectrum, potentially strengthening its competitive position in the wireless market. However, the substantial costs associated with building out the network represent another significant investment commitment for the company, with the expanded service reportedly targeted for early 2028.

[BRIEFING.COM] The major averages remain mostly lower at midday, with the DJIA (-0.9%) continuing to face the widest loss by a considerable margin as selling pressure persists across much of the broader market.

American Express (AXP 313.34, -11.84, -3.64%) is the Dow's worst-performing component following a disappointing earnings reaction. Despite exceeding adjusted EPS expectations and raising the lower end of its FY26 earnings outlook, the company reported a slight revenue miss and slowing billed business growth. Rising customer-benefit costs also weighed on underlying profitability, overshadowing continued strength in premium-card demand and healthy credit trends.

Separately, CNBC reported that American Express plans to eliminate approximately 5% of its global workforce.

[BRIEFING.COM] The major averages are mostly lower just before midday, with the S&P 500 (-0.1%) trading near its flat line, the Nasdaq Composite (+0.3%) holding a modest gain, and the DJIA (-0.9%) lagging amid broader selling pressure. Technology stocks are staging a modest rebound following yesterday's sharp retreat, although weakness across most other areas of the market is limiting the recovery.

The information technology sector (+0.8%) is one of just three S&P 500 sectors trading higher, with the PHLX Semiconductor Index (+1.1%) recovering a small portion of yesterday's steep losses but remaining firmly lower for the week.

Rising oil prices are adding pressure to economically sensitive stocks, with WTI crude futures up $2.78 (+2.8%) to $102.26 per barrel amid heightened geopolitical tensions. The energy sector (+2.9%) is benefiting from the advance, while other cyclical sectors are underperforming.

Several companies are seeing notable earnings-driven moves, although today's reports have lacked the broader market impact of yesterday's results, particularly those that intensified concerns about the AI trade.

[BRIEFING.COM] The major averages have climbed to their best levels of the session, with the Nasdaq Composite (+0.3%) moving into positive territory and the S&P 500 (-0.1%) approaching its flat line. The DJIA (-1.0%) continues to lag, while a rebound in AI-related stocks is helping the broader market recover from its early losses. The PHLX Semiconductor Index (+1.4%) is posting a modest recovery following yesterday's steep selloff.

However, earnings reactions among AI infrastructure companies remain mixed. Bloom Energy (BE 193.64, -24.13, -11.08%) is facing selling pressure despite reporting strong revenue growth and raising its FY26 earnings and revenue guidance. Investors appear more concerned about the company's negative free cash flow and substantial expansion costs, reflecting continued scrutiny of the financial demands associated with the AI buildout.

Western Digital (WDC 353.67, -0.52, -0.15%) is also trading lower despite better-than-expected earnings and upbeat guidance, supported by improving pricing and strong demand for high-capacity storage. Concerns about rising capital spending and the sustainability of AI-related growth remain important considerations for the group.

[BRIEFING.COM] The major averages continue to move lower this morning, with the S&P 500 (-0.5%), Nasdaq Composite (-0.1%), and DJIA (-1.4%) all trading in negative territory.

The final reading for the University of Michigan Consumer Sentiment Index for October increased to 48.0 (Briefing.com consensus: 46.3) from the preliminary reading of 46.3. The final reading for September was 48.1. In the same period a year ago, the index stood at 53.6.

The key takeaway from the report is that consumers remain concerned about higher prices reducing their purchasing power.

[BRIEFING.COM] Stocks are mostly lower shortly after the open, with the DJIA (-1.1%) bearing the brunt of the selling pressure this morning after weathering yesterday's tech-driven selloff. The S&P 500 (-0.4%) and Nasdaq Composite (flat) faring better amid a slight rebound from yesterday's lows across tech stocks.

Cyclical stocks are under pressure this morning amid a surge in oil prices, with crude oil currently up $3.10 (+3.1%) to $102.57 per barrel as reports indicate an escalation in the conflict between the U.S. and Iran is more likely than an off-ramp. The energy sector is up 1.7%, while the industrials (-1.9%) and consumer discretionary (-1.3%) sectors hold the widest losses, with Bloom Energy (BE 195.49, -22.28, -10.23%) sharply lower after earnings.

Meanwhile, the defensive health care (-0.9%), consumer staples (-0.8%), and utilities (-0.7%) sectors are facing some pressure after outperforming yesterday.

The information technology sector (+0.4%) holds a modest gain, as does the PHLX Semiconductor Index (+0.9%), though the gains are minimal in comparison to yesterday's retreat.

On the data front, the preliminary S&P Global U.S. Manufacturing PMI for October came in at 56.0, from a prior reading of 55.9.

The S&P Global U.S. Services PMI checked in at 57.9, from a prior reading of 58.8.

The final reading of the October University of Michigan Consumer Sentiment Index was 48.0 (Briefing.com consensus 46.3), up from the preliminary reading of 46.3.

Equity futures continue to point to a lower open this morning, with little indication of meaningful buy-the-dip interest following yesterday's sharp technology-led selloff.

The major averages are mixed on a week-to-date basis, reflecting the pronounced divergence in market leadership. The Nasdaq Composite (-0.5%) is on track for a weekly decline, while the S&P 500 (+0.1%) is holding a marginal gain and the DJIA (+1.7%) has significantly outperformed.

Both the Nasdaq Composite and S&P 500 also remain below their respective 50-day moving averages, adding to the cautious tone following yesterday's retreat.

The S&P 500 futures currently trade 37 points below fair value.

Asian markets finished mostly higher on Friday as dip buying stabilized equities following Thursday's sharp selloff, although persistent AI investment concerns and Middle East tensions kept the recovery in check. Japan's Nikkei 225 recovered from an intraday decline of more than 2% to finish just 0.3% lower, with Hitachi (-4%), Taiyo Yuden (-4%), Disco (-4%), and Mitsubishi UFJ (-2%) among the laggards, leaving the index down 4.0% for the week. Japan's core CPI accelerated to 2.1% yr/yr in September, matching expectations and returning above the Bank of Japan's 2% target, adding to the case for further tightening at a time when oil prices above $114 are creating another potential source of inflation. China's Shanghai Composite gained 0.9% and the Shenzhen Component rallied 2.8% as stepped-up state-backed ETF purchases helped stabilize equities, with Cambricon Technologies (+6%), SMIC (+4%), and Zhongji Innolight (+4%) participating in the rebound. Hong Kong's Hang Seng reversed an early decline to finish 0.7% higher, helped by MiniMax (+17%), Z.AI (+7%), Xiaomi (+4%), and Tencent (+1%), although the index still lost roughly 5% for the week. South Korea's KOSPI edged up 0.3%, with SK Hynix (+4%) rebounding alongside Samsung Biologics (+8%) and SK Square (+3%), while Hyundai Motor (-2%) and KB Financial (-3%) remained under pressure. Friday's stabilization does little to resolve the underlying debate surrounding the financing and returns of massive AI investments, with the Nikkei's 4.0% weekly decline highlighting the damage inflicted on markets heavily exposed to the theme. Brent crude remaining above $114 adds another challenge for the region, keeping energy supplies and inflation in focus amid escalating Middle East tensions.

• In economic data:
  • Japan's September National Core CPI increased 2.1% yr/yr (expected 2.1%; prior 1.7%); National CPI increased 2.1% yr/yr (prior 1.9%) and was unchanged m/m (prior 0.1%).
  • Japan's October Manufacturing PMI fell to 53.3 (expected 54.5; prior 54.1), Services PMI rose to 52.0 (prior 51.3), and Composite PMI was unchanged at 52.3 (prior 52.3).
  • Australia's October Manufacturing PMI edged up to 49.7 (prior 49.6), Services PMI fell to 47.8 (prior 51.9), and Composite PMI fell to 47.7 (prior 51.3).
  • India's October Manufacturing PMI slipped to 54.9 (prior 55.1), Services PMI rose to 56.2 (prior 55.2), and Composite PMI rose to 56.7 (prior 55.9).

European markets trade broadly lower as oil prices remain elevated amid Middle East tensions, while mixed earnings and weakening eurozone business activity keep sentiment cautious. Germany's DAX falls 0.8% as Deutsche Telekom (-3%) leads declines, while Rheinmetall (+2%) and Infineon (+1%) buck the weakness; Germany's composite PMI remains in expansion at 52.8, although growth slows more than expected as stronger manufacturing offsets softer services activity. France's CAC 40 drops 0.7% as Kering (-12%) plunges following disappointing quarterly sales, Safran (-7%) retreats despite stronger-than-expected revenue growth, and L'Oreal (+4%) rallies after beating sales expectations. France's composite PMI falls sharply to 48.4 from 51.1, returning the private sector to contraction and contrasting with Germany's continued expansion. London's FTSE 100 declines 0.6% despite stronger-than-expected October PMIs, as a plunge in consumer confidence and weaker September retail sales highlight a widening gap between improving business activity and household conditions, while Shell (+1%) and BP (+2%) benefit from elevated oil prices. The STOXX Europe 600 falls 0.6%, Italy's FTSE MIB loses 0.5%, and Spain's IBEX 35 slips 0.3%, with the eurozone composite PMI slowing to 51.9 from 53.1 and missing expectations.

• In economic data:
  • The eurozone's October Manufacturing PMI fell to 52.4 (expected 52.7; prior 52.9), Services PMI fell to 51.7 (expected 52.6; prior 53.0), and Composite PMI fell to 51.9 (expected 52.7; prior 53.1).
  • Germany's October Manufacturing PMI rose to 54.2 (expected 53.5; prior 53.9), Services PMI fell to 51.7 (expected 52.5; prior 52.9), and Composite PMI fell to 52.8 (expected 53.3; prior 53.8).
  • France's October Manufacturing PMI fell to 49.3 (expected 50.5; prior 50.6), Services PMI fell to 48.4 (expected 50.7; prior 51.2), and Composite PMI fell to 48.4 (expected 50.5; prior 51.1).
  • The U.K.'s October Manufacturing PMI rose to 52.8 (expected 51.8; prior 51.9), Services PMI rose to 53.1 (expected 51.8; prior 52.1), and Composite PMI rose to 53.1 (expected 51.8; prior 52.0).
  • The U.K.'s September Retail Sales fell 0.4% m/m (expected -0.1%; prior 0.7%) and increased 0.8% yr/yr (expected 1.0%; prior 2.7%); Core Retail Sales fell 0.7% m/m (expected -0.1%; prior 0.9%) and increased 0.8% yr/yr (expected 1.5%; prior 2.9%).
  • The U.K.'s October GfK Consumer Confidence fell to -24 (expected -14; prior -13).

The S&P 500 futures currently trade 29 points below fair value, with several of the index's largest components once again facing pressure this morning.

Meta Platforms (META 643.50, -5.35, -0.82) moves lower in the premarket after Barron's reported the company could launch an equity capital raise of $40 billion sometime over the next few weeks. The stock shed nearly 7% yesterday following its earnings release.

Meanwhile, Apple (AAPL 347.65, -0.57, -0.2%) is indicated for a modestly lower open, with Bloomberg reporting the iPhone Duo is now available in stores amid high demand.

Equity futures point to a modestly lower opening this morning following yesterday's sharp technology-led selloff, which sent the Nasdaq Composite (-2.6%) to its worst session since June. The retreat was particularly pronounced among semiconductor and AI-related stocks, with the PHLX Semiconductor Index plunging 6.7% as concerns about the costs of AI infrastructure investments and the industry's near-term growth prospects weighed heavily on the group.

Despite the sizable losses in the S&P 500 (-1.2%) and Nasdaq Composite, yesterday's selling was far from uniform. The DJIA finished near its flat line, while the S&P 500 Equal Weighted Index (+0.8%) advanced amid rotational buying interest in defensive and other areas of the market. Semiconductor stocks are showing modest gains in premarket trading, although the rebound is relatively small compared with yesterday's steep losses. Several influential mega-cap technology names remain firmly lower, suggesting that the pressure on the broader AI trade has yet to meaningfully subside.

Meanwhile, crude oil prices have climbed back above $100 per barrel amid renewed geopolitical tensions. According to The Wall Street Journal, Iran has threatened to attack U.S. bases, warships, and civilian targets in Gulf countries if the United States resumes military strikes, adding another source of uncertainty for a market already contending with the recent retreat in technology stocks.

Today's remaining economic calendar:

• 9:45 AM ET: October S&P Global U.S. Manufacturing PMI - Prelim; prior 55.9
• 9:45 AM ET: October S&P Global U.S. Services PMI - Prelim; prior 58.8
• 10:00 AM ET: October Univ. of Michigan Consumer Sentiment - Final; Briefing.com consensus 46.3; prior 46.3

In corporate news:

• American Express (AXP 319.16, -5.83, -1.79%) beat the Q3 earnings estimate, reported revenue roughly in line, and raised its FY26 earnings guidance above the FactSet consensus.
• Booz Allen Hamilton (BAH 80.25, +1.68, +2.14%) topped the Q2 earnings estimate but missed on revenue. Its FY27 earnings outlook is above consensus, while its revenue guidance brackets expectations.
• SpaceX (SPCX 148.00, +3.25, +2.3%) is trading higher pre-market after Bloomberg reported it is seeking access to at least 80,000 US cell sites, a potentially significant step toward becoming a fourth nationwide wireless carrier that is weighing on other carrier names.
• Western Digital (WDC 345.10, -9.09, -2.6%) beat earnings estimates by $0.53 and exceeded revenue expectations, issued above-consensus guidance for second-quarter earnings and revenue, and raised its quarterly cash dividend by 17%.

Reviewing overnight developments:

Nikkei reported that Asian markets finished mostly higher as dip buying helped stabilize equities after Thursday's selloff, although concerns about AI investment and Middle East tensions remained in focus.

In news:

• State-backed ETF purchases helped stabilize Chinese equities.
• Brent crude remained above $114 amid escalating Middle East tensions, keeping energy costs and inflation concerns in focus.

In economic data:

• Japan's September National Core CPI +2.1% yr/yr (expected +2.1%; prior +1.7%); National CPI +2.1% yr/yr (prior +1.9%) and unchanged m/m (prior +0.1%)
• Japan's October Manufacturing PMI 53.3 (expected 54.5; prior 54.1), Services PMI 52.0 (prior 51.3), and Composite PMI 52.3 (prior 52.3)
• Australia's October Manufacturing PMI 49.7 (prior 49.6), Services PMI 47.8 (prior 51.9), and Composite PMI 47.7 (prior 51.3)
• India's October Manufacturing PMI 54.9 (prior 55.1), Services PMI 56.2 (prior 55.2), and Composite PMI 56.7 (prior 55.9)

Equity Markets:

• Japan's Nikkei: -0.3%
• Hong Kong's Hang Seng: +0.7%
• China's Shanghai Composite: +0.9%
• India's Sensex: -0.2%
• South Korea's Kospi: +0.3%
• Australia's All Ordinaries: -0.1%

European markets trade broadly lower as elevated oil prices, mixed earnings, and slowing eurozone business activity weigh on sentiment.

In news:

• Kering retreated after disappointing quarterly sales, while L'Oreal advanced after beating sales expectations.
• Energy shares including Shell and BP benefited from elevated oil prices.

In economic data:

• Eurozone October Manufacturing PMI 52.4 (expected 52.7; prior 52.9), Services PMI 51.7 (expected 52.6; prior 53.0), and Composite PMI 51.9 (expected 52.7; prior 53.1)
• Germany's October Manufacturing PMI 54.2 (expected 53.5; prior 53.9), Services PMI 51.7 (expected 52.5; prior 52.9), and Composite PMI 52.8 (expected 53.3; prior 53.8)
• France's October Manufacturing PMI 49.3 (expected 50.5; prior 50.6), Services PMI 48.4 (expected 50.7; prior 51.2), and Composite PMI 48.4 (expected 50.5; prior 51.1)
• U.K.'s October Manufacturing PMI 52.8 (expected 51.8; prior 51.9), Services PMI 53.1 (expected 51.8; prior 52.1), and Composite PMI 53.1 (expected 51.8; prior 52.0)
• U.K.'s September Retail Sales -0.4% m/m (expected -0.1%; prior +0.7%) and +0.8% yr/yr (expected +1.0%; prior +2.7%); Core Retail Sales -0.7% m/m (expected -0.1%; prior +0.9%) and +0.8% yr/yr (expected +1.5%; prior +2.9%)
• U.K.'s October GfK Consumer Confidence -24 (expected -14; prior -13)

Equity Markets:

• STOXX Europe 600 : -0.6%
• Germany's DAX : -0.8%
• U.K.'s FTSE 100 : -0.6%
• France's CAC 40 : -0.7%
• Italy's FTSE MIB : -0.5%
• Spain's IBEX 35 : -0.3%

[BRIEFING.COM] The major averages finished Thursday's session with a sharply divided performance as substantial selling pressure in technology and AI-related stocks overshadowed strength across much of the broader market. The S&P 500 (-1.2%) and Nasdaq Composite (-2.6%) suffered sizable losses, with both falling below their respective 50-day moving averages, while the DJIA (flat) recovered to finish near unchanged. The contrast was even more pronounced beneath the surface, as the S&P 500 Equal Weighted Index (+0.8%) registered a solid gain despite the decline in its market-cap-weighted counterpart.

The retreat marked a sharp reversal from Wednesday's technology-led advance, with the latest round of earnings reports renewing concerns about the costs and near-term growth prospects of the AI buildout. Investors have become increasingly focused on the substantial capital required to expand computing infrastructure, intensifying competition for financing, and supply chain constraints that could limit companies' ability to meet elevated growth expectations.

The information technology sector (-3.0%) was among the weakest performers, with the PHLX Semiconductor Index (-6.7%) suffering an especially steep decline. Lam Research (LRCX 230.15, -30.66, -11.76%) faced substantial selling pressure after its forward guidance highlighted supply chain constraints, adding to concerns about the semiconductor industry's ability to sustain its recent growth trajectory. The weakness extended to AI infrastructure companies such as CoreWeave (CRWV 55.60, -6.22, -10.06%), reflecting broader skepticism about the pace and financing of continued expansion.

The communication services sector (-3.0%) also struggled, weighed down by a disappointing earnings reaction in Meta Platforms (META 648.85, -48.67, -6.98%). The company reported stronger-than-expected revenue and underlying earnings, supported by continued advertising growth, but investors focused instead on the mounting costs of its AI investments. Quarterly capital expenditures exceeded operating cash flow, resulting in negative free cash flow, while underlying operating margins contracted from a year ago. Bloomberg also reported that a measure of Meta's credit risk reached a record high, underscoring concerns about the financing requirements associated with its expansion plans.

Tesla (TSLA 374.58, -11.89, -3.08%) also declined following its earnings report, contributing to weakness in the consumer discretionary sector (-1.7%). Although the company exceeded adjusted EPS expectations and reported improving automotive margins, declining operating income and a reduction in its FY26 capital expenditure outlook to approximately $20 billion from more than $25 billion raised questions about the pace of investment in its autonomous driving and robotics initiatives.

The selling extended beyond traditional technology companies, with the industrials sector (-0.9%) pressured by sharp declines in electrical equipment and power infrastructure names associated with the AI buildout, including GE Vernova (GEV 827.42, -98.50, -10.64%), Quanta Services (PWR 552.44, -48.70, -8.10%), Eaton (ETN 368.99, -24.95, -6.33%), and Bloom Energy (BE 217.77, -20.76, -8.70%).

However, the sector's losses were moderated by strength in transportation stocks following favorable earnings reports from Ryder System (R 265.53, +25.22, +10.49%) and others.

While the AI-related retreat weighed heavily on the major averages, investors continued to favor lower-beta and defensive stocks. The Vanguard Mega Cap Growth ETF (-2.8%) underperformed significantly, while gains in the consumer staples (+3.1%), utilities (+2.0%), health care (+1.3%), and financials (+1.2%) sectors helped support the broader market. The consumer staples sector led the advance, benefiting from a strong earnings reaction in Procter & Gamble (PG 165.59, +8.75, +5.58%) .

The health care sector also finished higher despite substantial weakness in Moderna (MRNA 202.63, -43.18, -17.57%), which plunged following reports that cancer vaccine data had partially leaked ahead of the European Society for Medical Oncology conference. Moderna and Merck (MRK 147.24, -2.64, -1.76%) subsequently disclosed Phase 3 melanoma results showing that their combination treatment reduced the risk of recurrence or death by 42% compared with KEYTRUDA alone, although overall survival data remain immature.

Participation outside the largest technology companies was considerably healthier than the headline index losses suggested. The Russell 2000 (+0.1%) eked out a gain, while the S&P Mid Cap 400 (-0.8%) posted a more moderate decline. The S&P 500 Equal Weighted Index's 0.8% advance further highlighted the extent to which weakness in a relatively concentrated group of influential growth stocks dictated the performance of the major averages.

Elsewhere, crude oil prices climbed amid heightened geopolitical concerns surrounding potential additional U.S. and Israeli strikes against Iran. WTI crude futures settled $2.29 higher (+2.4%) at $99.45 per barrel, adding another source of uncertainty for investors already contending with the reassessment of AI-related growth expectations. Treasury yields, meanwhile, fell sharply as safe-haven demand and short-covering supported government bonds. The 2-year note yield declined 17 basis points to 4.65%, while the 10-year note yield settled 19 basis points lower at 4.95%, falling below 5.00% for the first time since September 22.

Although lower yields helped support rate-sensitive and defensive stocks, they provided little relief to the technology companies at the center of the selloff. Today's session underscored the increasingly selective nature of the market's recent trading. The sharp retreat in AI-related stocks reflected mounting scrutiny of the costs and returns associated with the industry's expansion, but strength across defensive sectors, transportation stocks, and the equal-weighted S&P 500 indicated that buying interest remained intact elsewhere. With another batch of earnings reports due after the close, investors will have additional opportunities to assess whether the outlook for AI-related growth can justify the market's elevated expectations.

• Russell 2000: +12.2% YTD
• S&P 500: +12.0% YTD
• Nasdaq Composite: +11.9% YTD
• S&P Mid Cap 400: +10.0% YTD
• DJIA: +10.0% YTD

Reviewing today's data:

• Initial jobless claims were down 6,000 for the week ending October 17 to 194,000 (Briefing.com consensus: 200,000). Continuing jobless claims for the week ending October 10 increased by 25,000 to 1.728 million.
  
  • The key takeaway from the report is still the same. Layoff activity is low, which is consistent with a solid demand environment for goods and services.
• Sep Leading Economic Index 0.0% (Briefing.com consensus -0.2%; Prior -0.1%)
  10/17 EIA Natural Gas Inventories +77 bcf (Prior +67 bcf)