[BRIEFING.COM] The major averages finished firmly higher on Friday, holding the bulk of an early advance through a relatively quiet afternoon. The S&P 500 (+0.7%), Nasdaq Composite (+1.2%), and DJIA (+0.5%) all ended with solid gains, while the Russell 2000 (+0.9%) and S&P Mid Cap 400 (+1.0%) outperformed. Despite today's broadly positive finish, only the Nasdaq Composite and S&P Mid Cap 400 ended the week with week-to-date gains.

The session's strongest move came during the morning following the September Employment Situation report, which showed nonfarm payrolls increasing by just 29,000 (Briefing.com consensus 100,000), alongside an uptick in the unemployment rate to 4.2% (Briefing.com consensus 4.1%) and a 0.1% month-over-month increase in average hourly earnings. The softer labor data initially reinforced expectations that the Fed will refrain from another rate hike at this month's FOMC meeting, helping propel the major averages to their session highs during the opening stretch.

That initial momentum faded as Treasury yields reversed their post-jobs-report decline, but the equity market gave back relatively little ground.

Crude oil provided another source of early support after G7 leaders announced a coordinated release of 100 million barrels of oil through the IEA, beginning immediately and extending over four months. WTI crude briefly fell below $90 per barrel before recovering a sizable portion of its decline, ultimately settling $1.92 lower (-2.1%) at $91.10 per barrel.

After settling below their morning highs around midday, the major averages spent most of the afternoon moving in a tight range and ultimately carried solid gains into the close.

Technology and mega-cap growth stocks remained at the forefront of the advance. The information technology sector (+1.1%) finished among the day's leaders, while the PHLX Semiconductor Index gained 2.4%. NVIDIA (NVDA 233.95, +3.09, +1.34%) was among the notable semiconductor winners, and the Vanguard Mega Cap Growth ETF rose 1.0%.

SpaceX (SPCX 158.95, +10.88, +7.35%) was another standout among growth-oriented names, climbing amid favorable analyst commentary regarding demand for its Grok Bot.

Mega-cap strength also helped lift the communication services sector (+0.9%), which finished among the better-performing groups.

The consumer discretionary sector (+1.4%) topped the sector standings, supported by a sizable gain in Tesla (TSLA 370.59, +16.48, +4.65%) after the company reported Q3 deliveries of 486,532 vehicles, above its company-compiled analyst consensus of 461,974. Tesla's strength helped offset a sharp post-earnings decline in NIKE (NKE 33.90, -1.26, -3.57%), which ranked among the worst-performing S&P 500 components and fell to fresh decade lows following a disappointing FY27 outlook.

There was also pronounced divergence elsewhere in the technology landscape. Western Digital (WDC 415.29, -47.27, -10.22%) and Seagate Tech (STX 848.99, -96.58, -10.21%) came under heavy pressure after Toshiba announced an expansion of HDD production in the Philippines, raising concerns that additional industry capacity could eventually loosen the tight supply-demand environment that has supported strong pricing and margins.

The materials sector (+1.0%) was another standout, while all 11 S&P 500 sectors ultimately finished at or above their flat lines.

The health care (flat) and financials (flat) sectors were today's laggards, with continued weakness in biotech names weighing on the health care sector.

Participation was also healthier than the recent pattern of concentrated mega-cap leadership might suggest. The Russell 2000 and S&P Mid Cap 400 both outperformed the S&P 500, and every S&P 500 sector avoided a loss. Still, the S&P 500 Equal Weighted Index (+0.4%) trailed the cap-weighted index (+0.7%), underscoring that technology and mega-cap growth stocks continued to provide an outsized portion of the support.

Ultimately, Friday's session combined stronger participation across small- and mid-cap stocks with continued leadership from technology and mega-cap growth names. The market's ability to preserve most of its early advance despite the reversal in Treasury yields was notable, although the gap between the cap-weighted and Equal-Weight S&P 500 showed that the familiar concentration in the market's largest stocks remained firmly in place.

U.S. Treasuries finished the week with losses across the curve after a brief morning rally gave way to a reversal that lifted yields on longer tenors back to their highest levels of the year. The 2-year note yield settled up three basis points to 4.82% (+4 basis points this week), and the 10-year note yield settled up four basis points to 5.28% (+10 basis points this week). 

• Nasdaq Composite: +17.0% YTD
• Russell 2000: +14.1% YTD
• S&P 500: +12.8% YTD
• S&P Mid Cap 400: +11.0% YTD
• DJIA: +6.5% YTD

Reviewing today's data:

• Sep Nonfarm Payrolls 29K (Briefing.com consensus 100K; Prior 133K revised from 162K)
• Sep Nonfarm Private Payrolls 46K (Briefing.com consensus 100K; Prior 89K revised from 127K)
• Sep Unemployment Rate 4.2% (Briefing.com consensus 4.1%; Prior 4.1%)
• Sep Average Hourly Earnings 0.1% (Briefing.com consensus 0.3%; Prior 0.3%)
• Sep Average Workweek 34.4 (Briefing.com consensus 34.3; Prior 34.4)
• Factory orders increased 0.1% month-over-month in August (Briefing.com consensus: 0.0%) following a downwardly revised 0.8% increase (from 0.9%) in July. Excluding transportation, factory orders increased 0.3% on the heels of a 0.7% increase in July. Shipments of manufactured goods were flat after being up 0.8% in July.
  • The key takeaway from the report is that business spending was up solidly in August, notwithstanding an overall sluggish increase in factory orders.

[BRIEFING.COM] The major averages continue to move in a tight range this afternoon as the bulk of today's market-moving developments came before noon.

Crude oil futures settled today's session $1.92 lower (-2.1%) at $91.10 per barrel, which is well off its earlier lows that saw it move below $90 per barrel. Crude oil shed just under 1.5% this week as the market awaits more impactful developments on the U.S.-Iran conflict.

[BRIEFING.COM] The S&P 500 (+0.7%), Nasdaq Composite (+1.2%), and DJIA (+0.4%) are sustaining today's advance as the market enters the final hour of today's session, though the gains keep only the Nasdaq Composite (+1.2%) on track for a higher week-to-date finish.

Part of the Nasdaq's strength is due to a sizable gain in SpaceX (SPCX 158.89, +10.82, +7.31%), which is being attributed to favorable analyst commentary regarding demand for its Grok Bot. While the stock is still more than 30% off its all-time high from June 16, it now trades more than 10% above its 200-day moving average of $143.64.

[BRIEFING.COM] The S&P 500 (+0.6%) remains just below its opening level after dipping from its session high that was reached during the initial 90 minutes of trade. Given the current standing, the benchmark index is down 0.4% for the week, while the Nasdaq (+1.1%) outperforms, tracking a 0.3% gain for the week.

Nine sectors hold gains in afternoon trade with the consumer discretionary sector (+1.2%) defending the lead. This has narrowed the group's week-to-date loss to 0.4% while top-weighted technology (+1.0%) is on track to gain 1.3% for the week.

On the downside, health care (-0.3%) underperforms today, continuing this week's show of relative weakness that has the sector down 3.0% since last Friday, largely due to underperformance among biotech names. Gilead Sciences (GILD 144.29, -3.21, -2.18%) is today's worst performer in the sector, widening this week's loss to 4.3%.

[BRIEFING.COM] The Nasdaq Composite remains the relative leader with a 1.2% gain, while the S&P 500 is up 0.7% and the DJIA is higher by 0.4%. The major averages have seen modest changes since the prior update and remain below their morning highs amid a reversal in the Treasury market.

The 10-year note yield is up four basis points at 5.28%, well above its post-jobs-report low of 5.16%. Treasuries rallied immediately following the report, but the buying did not persist, and yields moved steadily higher across the curve. That reversal has tempered the earlier equity momentum, although growth-oriented shares continue to outperform.

Within the Dow Jones Industrial Average, Cisco (CSCO 111.82, +3.06, +2.81%) is the biggest percentage gainer while NIKE (NKE 33.52, -1.62, -4.62%), after a disappointing FY27 outlook, is the biggest percentage loser. Now trading close to $30.0 per share, there are bound to be questions as to how much longer the stock will be retained in the Dow Jones Industrial Average.

[BRIEFING.COM] The major averages remain firmly higher just after midday.

The health care sector (-0.4%) is the worst-performing S&P 500 sector today, extending its decline for the week to 3.0% and leaving the group on pace for its lowest close since early August. Biotech stocks are also under pressure, with the SPDR Biotech ETF (XBI 154.03, -0.48, -0.31%) hovering near levels last seen in early August, while relative strength among managed care names has helped limit the sector's decline. Johnson & Johnson (JNJ 255.64, -3.02, -1.17%) and Amgen (AMGN 403.00, -4.27, -1.05%) are among the worst-performing DJIA components outside of NIKE (NKE 33.39, -1.76, -5.01%).

[BRIEFING.COM] The S&P 500 (+0.7%), Nasdaq Composite (+1.2%), and DJIA (+0.4%) remain firmly higher at midday, although the major averages have backed away from their morning highs as Treasury yields reversed higher. Technology, semiconductor, and mega-cap growth stocks continue to do much of the heavy lifting, but today's advance is accompanied by better participation across the broader market than has been seen recently.

Stocks initially surged following this morning's Employment Situation report, which reinforced expectations that the Fed may refrain from another rate hike at this month's FOMC meeting. Nonfarm payrolls increased by just 29,000, while the unemployment rate ticked up to 4.2% and average hourly earnings increased only 0.1% month-over-month. The probability of the Fed keeping rates unchanged at the October meeting briefly climbed above 80% following the report, according to the CME FedWatch Tool. That probability has since slipped to 76.2%, nearly in line with yesterday, as Treasury yields reversed their initial decline.

The 10-year note yield is now up four basis points to 5.28%, with the rebound in yields taking some momentum out of the stock market's earlier advance. A sharp drop in crude oil also provided early encouragement. WTI crude fell more than 4% after G7 leaders announced a coordinated release of 100 million barrels of oil through the IEA, beginning immediately and extending over four months. Oil has recovered much of that decline, however, and is currently down $1.38 (-1.5%) at $91.49 per barrel.

Despite the pullback from the morning highs, the tone remains broadly positive. Eight of the 11 S&P 500 sectors trade higher, while the Russell 2000 (+0.9%) and S&P Mid Cap 400 (+1.1%) continue to outperform the major averages.

Still, mega-cap and technology stocks are once again providing disproportionate support at the index level. The S&P 500 Equal Weighted Index is up just 0.3%, compared with the 0.7% gain in the cap-weighted S&P 500, while the Vanguard Mega Cap Growth ETF is up 0.9%.

The information technology sector (+1.1%) remains one of the primary sources of leadership, with the PHLX Semiconductor Index up 2.7%. NVIDIA (NVDA 235.36, +4.50, +1.95%) is among the notable semiconductor winners, while all seven "Magnificent Seven" stocks trade higher.

There is some pronounced divergence within the broader technology landscape. Western Digital (WDC 403.94, -58.62, -12.67%) and Seagate Tech (STX 827.14, -118.43, -12.52%) are under heavy pressure after Toshiba announced an expansion of HDD production in the Philippines, raising concerns that additional industry capacity could eventually loosen the tight supply-demand environment that has supported strong pricing and margins. 

The consumer discretionary sector (+1.3%) is another standout, supported by a sizable gain in Tesla (TSLA 372.12, +18.01, +5.09%) after the company reported Q3 deliveries of 486,532 vehicles, above its company-compiled analyst consensus of 461,974. That strength is outweighing a sharp post-earnings decline in NIKE (NKE 33.34, -1.80, -5.14%), which is among the worst-performing S&P 500 components and has fallen to fresh decade lows following a disappointing FY27 outlook.

The materials sector (+1.1%) is also among the day's better-performing groups. At the other end of the standings, the health care (-0.3%), consumer staples (-0.1%), and financials (-0.1%) sectors are the only groups trading lower.

Overall, today's action represents an improvement from the weak participation that has characterized much of the market's recent trade, particularly with small- and mid-cap stocks outperforming. Even so, the sizable gap between the cap-weighted and Equal-Weight S&P 500 shows that mega-cap growth and technology stocks remain an outsized source of support for the major averages.

[BRIEFING.COM] The major averages trade in a steady range just after midday.

The information technology sector (+1.2%) is seeing some notable divergence today even as semiconductor stocks broadly rally, with the PHLX Semiconductor Index up 3.1%.

Western Digital (WDC 404.21, -58.35, -12.61%) and Seagate Tech (STX 826.54, -119.03, -12.59%) are under heavy pressure after Toshiba announced an expansion of HDD production in the Philippines, raising concerns that additional industry capacity could eventually loosen the tight supply-demand environment that has supported strong pricing and margins. WDC and STX are not components of the PHLX Semiconductor Index.

Meanwhile, onsemi (ON 84.17, +4.09, +5.11%) is sharply higher after restructuring its proposed Synaptics (SYNA 121.24, +15.08, +14.21%) acquisition into a $123-per-share all-cash transaction, eliminating the share dilution associated with the previously announced all-stock deal and accelerating the expected timeline for EPS accretion.

[BRIEFING.COM] The major averages are off their session lows at midday, though the Nasdaq Composite (+1.3% today, +0.5% week-to-date) remains the only major index on pace for a week-to-date gain.

NIKE (NKE 33.20, -1.96, -5.56%) is among the worst-performing S&P 500 components today, falling to fresh decade lows after its Q1 report. While earnings topped expectations, a slight revenue miss and a disappointing FY27 outlook overshadowed the results, as continued weakness across Sportswear, Jordan Brand, and Greater China weighs on the company's turnaround.

The stock is down nearly 50% year-to-date, plunging further below its respective 50-day (38.93) and 200-day (48.71) moving averages.

[BRIEFING.COM] The S&P 500 (+0.6%), Nasdaq Composite (+1.0%), and DJIA (+0.2%) have pulled back from their earlier highs as U.S. Treasuries give back their initial gains.

Crude oil remains firmly lower, currently down $2.63 (-2.8%) to $90.24 per barrel, although it has recovered from steeper losses that followed the G7's announcement of a coordinated release of 100 million barrels of oil through the IEA, beginning immediately and extending over four months.

U.S. Treasuries, meanwhile, have returned to near their opening levels, with the 10-year note yield now up one basis point to 5.25%.

Still, stocks remain broadly higher, with eight S&P 500 sectors trading in positive territory. Mega-cap and technology stocks continue to provide solid leadership, with the information technology sector (+0.9%) and consumer discretionary sector (+1.2%) among today's best performers. The Vanguard Mega Cap Growth ETF is up 0.8%, while the PHLX Semiconductor Index has climbed 2.7%.

The advance also extends beyond the market's largest names, with the Russell 2000 (+1.0%) and S&P Mid Cap 400 (+0.9%) outperforming the major averages.

[BRIEFING.COM] The major averages remain firmly higher amid broad strength and solid gains across some of the market's largest names.

Tesla (TSLA 371.19, +17.08, +4.82%) is among the top performers after reporting Q3 deliveries of 486,532 vehicles, approximately 5.3% above its company-compiled analyst consensus of 461,974, on production of 464,391. Deliveries exceeded production by 22,141 vehicles, consistent with an inventory drawdown, although the update does not establish stronger current orders or profitability, and energy-storage deployments missed expectations. All seven "Magnificent Seven" names trade higher.

NVIDIA (NVDA 235.17, +4.31, +1.87%) is another standout, as the PHLX Semiconductor index (+3.0%) continues to move higher today.

[BRIEFING.COM] The S&P 500 (+1.1%), Nasdaq Composite (+1.7%), and DJIA (+0.6%) continue to chart session highs this morning as oil retreats further.

WTI crude is currently down $4.17 (-4.5%) to $88.71 per barrel after G7 leaders announced a coordinated release of 100 million barrels of oil through the International Energy Agency, beginning immediately and extending over four months. The move is aimed at stabilizing global energy supplies and easing the recent surge in oil prices, providing some relief from one of the key inflationary and market headwinds in recent weeks.

On the data front, factory orders increased 0.1% month-over-month in August (Briefing.com consensus: 0.0%) following a downwardly revised 0.8% increase (from 0.9%) in July. Excluding transportation, factory orders increased 0.3% on the heels of a 0.7% increase in July. Shipments of manufactured goods were flat after being up 0.8% in July.

The key takeaway from the report is that business spending was up solidly in August, notwithstanding an overall sluggish increase in factory orders.

[BRIEFING.COM] The S&P 500 (+1.0%), Nasdaq Composite (+1.6%), and DJIA (+0.5%) are off to a higher start this morning as a more favorable macro backdrop prompts broad gains across stocks.

Crude oil is down $3.30 (-3.6%) to $89.51 per barrel amid reports that Europe is considering releasing diesel supplies from its reserve stocks, while IEA members are considering a release of 50 million barrels of oil. Treasury yields are modestly lower across the curve, adding to yesterday's progress, which helped stocks eke out a mostly higher finish.

Additionally, this morning's somewhat weaker-than-expected employment report adds to the market's hopes that the Fed may not deliver another rate hike at the October FOMC meeting. The odds that the Fed keeps rates on hold jumped to 81.7% following the report, according to the CME FedWatch tool, up from 75.7% yesterday.

So far, that has translated into broad stock gains, which is a welcome sight given creeping concerns about weak participation across the broader market. Eight S&P 500 sectors trade higher, with tech and mega-cap stocks providing solid leadership. The Vanguard Mega Cap Growth ETF is up 1.3%. Tesla (TSLA 370.95, +16.84, +4.76%) is a standout, helping the consumer discretionary sector (+1.6%) climb to the top of the sector standings, with NIKE (NKE 33.08, -2.07, -5.89%) post-earnings retreat being outweighed by gains across a host of oil and rate-sensitve stocks. 

The information technology sector (+1.4%) is not far behind, supported by a 3.1% gain in the PHLX Semiconductor Index.

Meanwhile, the defensive health care (-0.3%) and financials (-0.1%) sectors hold modest losses while the energy sector (-0.1%) sits just below its flatline amid the retreat in oil prices.

Just released, factory orders increased 0.1% in September (Briefing.com consensus 0.0%), from the downwardly revised previous increase of 0.8% (from 0.9%).

The stock market remains on track for a firmly higher open this morning, with technology shares advancing in premarket trading following the release of the Employment Situation report.

The September employment report skewed more toward a "bad news is good news" kind of read. We say that recognizing that nonfarm payrolls increased by just 29,000, while revisions to July and August combined led to 60,000 fewer jobs than previously reported. The unemployment rate ticked up from 4.1% to 4.2% (still low) and average hourly earnings rose only 0.1% month-over-month, leaving them up 3.0% year-over-year versus 3.1% in July.

The key takeaway from the report is that it isn't going to exacerbate inflation concerns for the Fed. It won't eradicate those concerns, but in terms of the market's newfound belief that the Fed is unlikely to raise rates at its October FOMC meeting, this report slides neatly into that thinking.

The S&P 500 futures are trading 71 points above fair value.

Asian markets finished sharply lower on Friday, with the overnight pullback in oil coming too late to offset pressure from elevated global bond yields and geopolitical concerns. Japan's Nikkei 225 fell 0.9%, snapping a two-day winning streak, after Tokyo core inflation accelerated to 2.7% in September, moving above the BOJ's 2% target for the first time in nine months. SoftBank Group (-6.0%) was a notable laggard after completing the final $10 bln tranche of its follow-on investment in OpenAI, bringing its total investment to $64.6 bln, although the Nikkei still gained 2.9% for the week. Hong Kong's Hang Seng plunged 2.6% to 23,972, its largest one-day decline since July, with the US 10-year yield reaching 5.34% and Brent crude holding above $102 during the session. AIA (-6.0%), Xiaomi (-4.0%), HKEX (-3.1%), and Tencent (-2.3%) led the declines, while the absence of Southbound Stock Connect flows added pressure. China's Shanghai Composite remained closed for the National Day holiday.

• In economic data:
  • Japan's September Tokyo CPI increased 2.7% yr/yr (prior 1.9%); Tokyo Core CPI increased 2.7% yr/yr (expected 2.4%; prior 1.8%); and Tokyo CPI excluding food and energy increased 2.7% yr/yr (prior 1.4%).
  • Japan's August Unemployment Rate increased to 2.5% (expected 2.4%; prior 2.4%).
  • South Korea's September CPI increased 0.3% m/m (expected 0.4%; prior 0.2%) and 2.9% yr/yr (expected 2.9%; prior 3.1%).

European markets trade higher, with lower oil prices and easing bond yields helping stabilize sentiment following a volatile week. Germany's DAX rises more than 1% to cross 25,200, led by technology shares, while reports of a possible release of European oil reserves help ease some concerns over energy-driven inflation. Eurozone inflation accelerated to 3.8% yr/yr in September, its highest level in three years and above the 3.7% consensus, while core inflation edges up to 2.5%. France's CAC 40 gains 0.9%, with Schneider Electric (+1.7%), Danone (+3.0%), and Legrand (+2.0%) advancing, although concerns surrounding France's fiscal outlook remain in focus. London's FTSE 100 also trades higher, attempting to recover from four consecutive losses, while IG Group tumbles more than 20% after warning that annual revenue growth will reach only the mid-single-digit range. Geopolitical risks remain in focus amid diminished prospects for a US-Iran truce, although the pullback in oil provides some near-term relief.

• In economic data:
  • Eurozone September CPI increased 0.6% m/m (prior 0.4%) and 3.8% yr/yr (expected 3.7%; prior 3.2%); Core CPI increased 0.2% m/m (prior 0.2%) and 2.5% yr/yr (expected 2.5%; prior 2.4%).
  • Spain's September Unemployment Change totaled 23.6K (expected 17.6K; prior 44.4K).
  • Italy's August Retail Sales increased 0.3% m/m (expected -0.1%; prior -0.4%) and 0.5% yr/yr (prior 1.0%).

The S&P 500 futures currently trade 64 points above fair value.

Just released, nonfarm payrolls increased by 29K (Briefing.com consensus 100K) from the downwardly revised prior increase of 133K (from 162K).

Nonfarm private sector payrolls increased by 46K (Briefing.com consensus 100K) from the downwardly revised previous increase of 89K (from 127K).

The unemployment rate increased slightly to 4.2% (Briefing.com consensus 4.1%) from the prior level of 4.1%.

Average hourly earnings increased by 0.1% in September (Briefing.com consensus 0.3%), from the prior increase of 0.3%.

The average workweek held steady at 34.4 hours in September (Briefing.com consensus 34.3).

Equity futures point to a higher open this morning as oil prices move firmly lower, which has in turn caused U.S. Treasury yields to move modestly lower as well. Crude oil is currently down $3.47 (-3.8%) to $89.39 per barrel amid reports that European countries have discussed releasing strategic diesel reserves.

Stocks finished mostly higher yesterday after an uneven session, as declining Treasury yields helped broaden gains beyond technology shares.

Expectations for a rate hike at the next FOMC meeting receded further yesterday following dovish Fed commentary, putting this morning's Employment Situation report in focus for any potential shift in the policy outlook.

Today's remaining economic calendar:

• 8:30 AM ET: September Nonfarm Payrolls; Briefing.com consensus 100K; prior 162K
• 8:30 AM ET: September Nonfarm Private Payrolls; Briefing.com consensus 100K; prior 127K
• 8:30 AM ET: September Unemployment Rate; Briefing.com consensus 4.1%; prior 4.1%
• 8:30 AM ET: September Average Hourly Earnings; Briefing.com consensus 0.3%; prior 0.3%
• 8:30 AM ET: September Average Workweek; Briefing.com consensus 34.3; prior 34.4
• 10:00 AM ET: August Factory Orders; Briefing.com consensus 0.0%; prior 0.9%

In corporate news:

• Amazon (AMZN 249.72, +1.49, +0.6%) is aiming to sell $8 billion in Nvidia (NVDA 234.70, +3.84, +1.7%) chips to outside investors
• Broadcom (AVGO 347.45, +3.81, +1.1%) is aiming to raise $60 billion in new financing to fund chips for Anthropic, according to Bloomberg.
• NIKE (NKE 32.06, -3.09, -8.79%) topped the quarterly earnings consensus, but guided fiscal 2027 EPS below consensus and expects revenue to decline by a high-single-digit percentage.
• onsemi (ON 86.38, +6.30, +7.87%) amended its agreement to acquire Synaptics in an all-cash transaction valued at about $5.7 billion, saying the revised structure is expected to be immediately accretive to non-GAAP EPS at closing.

Reviewing overnight developments:

According to Nikkei, markets in Japan and Hong Kong closed lower, while mainland China and India were closed for holidays. Elevated global bond yields and geopolitical concerns remained in focus.

In news:

• China's Shanghai market was closed for the National Day holiday, and the absence of Southbound Stock Connect flows weighed on Hong Kong trading.

In economic data:

• Japan's September Tokyo CPI 2.7% yr/yr (prior 1.9%); Tokyo Core CPI 2.7% yr/yr (expected 2.4%; prior 1.8%); Tokyo CPI ex-food and energy 2.7% yr/yr (prior 1.4%); August Unemployment Rate 2.5% (expected 2.4%; prior 2.4%)
• South Korea's September CPI 0.3% m/m (expected 0.4%; prior 0.2%) and 2.9% yr/yr (expected 2.9%; prior 3.1%)

Equity Markets:

• Japan's Nikkei: -0.9%
• Hong Kong's Hang Seng: -2.6%
• China's Shanghai Composite: closed for holiday
• India's Sensex: closed for holiday
• South Korea's Kospi: +0.5%
• Australia's All Ordinaries: +0.7%

European markets trade higher, with lower oil prices and easing bond yields helping stabilize sentiment after a volatile week.

In news:

• Reports of a possible release of European oil reserves helped ease some concerns about energy-driven inflation. France's fiscal outlook and diminished prospects for a U.S.-Iran truce remain in focus.

In economic data:

• Eurozone's September CPI 0.6% m/m (prior 0.4%) and 3.8% yr/yr (expected 3.7%; prior 3.2%); Core CPI 0.2% m/m (prior 0.2%) and 2.5% yr/yr (expected 2.5%; prior 2.4%)
• Spain's September Unemployment Change 23.6K (expected 17.6K; prior 44.4K)
• Italy's August Retail Sales 0.3% m/m (expected -0.1%; prior -0.4%) and 0.5% yr/yr (prior 1.0%)

Equity Markets:

• STOXX Europe 600 : +1.0%
• Germany's DAX : +1.0%
• U.K.'s FTSE 100 : +0.3%
• France's CAC 40 : +0.7%
• Italy's FTSE MIB : +0.2%
• Spain's IBEX 35 : +0.4%

[BRIEFING.COM] The major averages recovered from a broad morning retreat on Thursday, with a sharp reversal in Treasury yields helping stocks regain their footing and strength across technology, semiconductors, and other AI-related names providing additional support. The S&P 500 (+0.2%) finished modestly higher, while the Nasdaq Composite (flat) and DJIA (flat) ended little changed. The recovery was more pronounced across the broader market. The Russell 2000 (+0.5%) and S&P Mid Cap 400 (+1.1%) both rebounded from morning losses and outperformed the major averages, marking a notable improvement in participation as the session progressed.

Stocks opened with modest gains before selling pressure quickly broadened, sending the major averages to their session lows late in the morning. Treasury yields were a significant early headwind, particularly at the long end of the curve, as generally solid economic data pushed longer-dated yields back toward their overnight highs. The tone improved considerably as the session progressed, however, as yields reversed lower across the curve.

The retreat helped stocks recover their morning losses and also encouraged better participation beneath the surface. Fed Vice Chair Phillip Jefferson, a voting FOMC member, provided some additional encouragement for expectations that the Fed will leave rates unchanged at its October meeting. Jefferson said future policy adjustments should be determined by trends in the data, the evolving outlook, and the balance of risks, adding that policymakers will need to come to their own judgment and that doing so "may take more time." The CME FedWatch Tool now assigns a 76.2% probability to the Fed keeping rates steady at the October meeting, up from 62.4% yesterday.

Technology stocks provided another important source of support. The information technology sector (+0.8%) finished among five S&P 500 sectors in positive territory, while the PHLX Semiconductor Index gained 1.6%. Micron (MU 1097.39, +32.28, +3.03%) was a notable contributor to the semiconductor group's strength after reversing an early post-earnings decline and finishing higher. The turnaround followed an initially cautious response to the company's better-than-expected Q4 results and strong Q1 guidance, with enthusiasm surrounding AI-driven memory demand ultimately helping the stock find its footing.

Accenture (ACN 212.73, +29.36, +16.01%) was another standout after beating Q4 expectations, as its results and stronger bookings increased confidence that AI is becoming a growth driver rather than a disruption risk for the company. Synopsys (SNPS 490.54, +55.60, +12.78%) also ranked among the best-performing S&P 500 components following its Investor Day.

Strength across AI-infrastructure names extended beyond the technology sector, helping the industrials sector (+1.0%) finish among the day's leaders.

The utilities sector (+0.6%) also benefited from the reversal lower in Treasury yields, while the financials sector (+0.2%) also finished modestly.

The energy sector (+1.9%) led the standings as crude oil extended its recent advance. WTI crude settled $2.48 higher (+2.7%) at $93.02 per barrel amid continued geopolitical uncertainty.

At the other end of the standings, the communication services sector (-1.2%) and health care sector (-1.3%) were clear laggards. Alphabet (GOOG 334.93, -5.81, -1.71%)) weighed on the communication services sector after reversing an opening gain that followed the unveiling of Gemini 4 Argon. Paramount Skydance (PSKY 9.34, -0.99, -9.58%) also remained under pressure as investors digested news that its merger with Warner Bros. Discovery (WBD 30.95, +0.00, +0.00%) is expected to close on October 6.

Ultimately, the session featured a meaningful improvement from the broad weakness seen during the morning. The reversal lower in Treasury yields relieved some of the pressure that has recently weighed on equities, while continued strength across semiconductors, technology, and AI-infrastructure stocks helped the S&P 500 finish higher. The outperformance of small- and mid-cap stocks also represented a welcome improvement in participation after the narrow leadership that characterized much of September, although pronounced weakness in the communication services and health care sectors kept the S&P 500's advance relatively modest, leaving the major averages firmly lower heading into Friday's session.

U.S. Treasuries had a volatile session, with yields ultimately settling near their lows for the day even though oil prices traded higher. The 2-year note yield settled down 10 basis points to 4.79%, and the 10-year note yield settled down six basis points to 5.24%.

• Nasdaq Composite: +15.6% YTD
• Russell 2000: +13.1% YTD
• S&P 500: +12.0% YTD
• S&P Mid Cap 400: +9.9% YTD
• DJIA: +6.0% YTD

Reviewing today's data:

• For the week ending September 26, initial jobless claims fell by 1,000 to 197,000 (Briefing.com consensus: 200,000). Continuing jobless claims for the week ending September 19 decreased by 11,000 to 1.701 million.
  • The key takeaway from the report remains the same: layoff activity continues to run at low levels that reflect a solid demand environment.
• Sep S&P Global U.S. Manufacturing PMI - Final 55.9 (Briefing.com consensus 55.3; Prior 57.0)
• Construction spending increased 0.9% month-over-month in August (Briefing.com consensus: 0.3%) following a 0.1% decline in July. On a year-over-year basis, construction spending was down 1.7%.
  • The key takeaway from the report was the strength seen in private construction, which included solid increases for both residential and nonresidential spending.
• The ISM Manufacturing Index decreased to 54.5% in September (Briefing.com consensus: 55.2%) from 54.6% in August. The dividing line between expansion and contraction is 50.0%, so the September figure suggests manufacturing activity expanded in September from the prior month but at a slightly slower pace.
  • The key takeaway from the report is that it showed an ongoing expansion in manufacturing activity that was accompanied by a faster acceleration in prices paid, which will continue to foment concerns about pass-through effects for customers.
• 09/26 EIA Natural Gas Inventories +64 bcf (Prior +53 bcf)