Morning in New York: bigtech inspires the "bulls"

Daily review and forecast of events on the U.S. stock market from Mikhail Denislamov, Deputy Director of Freedom Capital Markets Research.

The focus of attention of the participants of the upcoming trades will be the publication of the Chicago PMI for October (consensus: 42.5 points, September: 40.6 points). This indicator reflects the dynamics of the manufacturing sector in the region and is a leading indicator for the national index from ISM. Despite the expected improvement, a reading below 50 indicates a continued slowdown in business activity and continued pressure on the manufacturing sector.

The publication of the U.S. income and expenditure statistics (Personal Income and Personal Spending), as well as the Personal Consumption Expenditures (PCE) price index for September will not take place due to the ongoing shutdown. The suspension of the Bureau of Economic Analysis (BEA) deprives the market of key benchmarks on the dynamics of income, consumption and inflation, increasing uncertainty about further actions of the Fed.

Before the main session opens, Exxon Mobil (XOM), Chevron (CVX), AbbVie (ABBV), Linde (LIN), Charter Communications (CHTR), Aon (AON ) and Dominion Energy (D) will present financial results.

Futures on US indices show positive dynamics. We assess the balance of risks as positive with average volatility. We focus on S&P 500 fluctuations in the range of 6800-6900 points (from -0.3% to +1.1% to the previous session's closing level).

- Amazon (AMZN) shares are up more than 10% on the premarket. The company significantly exceeded analysts' expectations both in terms of revenue and profit. The main positive drivers for these indicators were the active growth of the AWS cloud division and strong revenue dynamics of the retail segment.

- Apple's (AAPL) quarterly results beat consensus, sending its stock up more than 2% before the open of major trading. Record revenue in the services segment helped offset slightly weaker-than-expected iPhone sales. A confident guidance for the company's most important pre-holiday period for sales suggests revenue growth of 10-12%. This supported positive investor sentiment.

- Western Digital (WDC) quotes are adding more than 10% before the start of the main session. The storage device maker's quarterly results were strong. Management provided an optimistic outlook, pointing to a recovery in demand from cloud providers and an improvement in the industry as a whole.

- Cloudflare (NET) securities are up more than 8% on the premarket. The company posted its second consecutive quarter of accelerating revenue growth (+31% YoY) and a significant improvement in profitability, reducing its GAAP net loss by 91% YoY.

- Reddit (RDDT) shares are gaining more than 12% after the company released its quarterly report that beat analysts' forecasts. The company's revenue grew 68% YoY. A solid outlook for the fourth quarter and increased revenue from data licensing for training AI models convince investors of the platform's long-term monetization prospects.

- First Solar (FSLR) shares are up nearly 5% before the open of major trading. Although its revenue and earnings for the last quarter were slightly below consensus, investors focused on strategically important news. The company announced the construction of a manufacturing site in the U.S., which was seen as a sign of long-term growth prospects.

- Netflix (NFLX) shares reacted by rising more than 3% on the announcement of a 10-to-1 stock split to increase accessibility to retail investors, which is seen by the market as an optimistic signal from management.

- Dexcom (DXCM) shares tumbled about 13% in the pre-trading session. Although the glucose monitoring systems maker's quarterly results beat average expectations, the fourth-quarter earnings guidance was weaker than consensus, disappointing investors.

Trades on October 30 on American stock exchanges ended in the negative. S&P 500 corrected by 0.99%, NASDAQ 100 fell by 1.47%, Dow Jones fell by 0.23%, and Russell 2000 lost 0.76%. Pressure on quotes was exerted by ambiguous quarterly results of the "Magnificent Seven" companies, restrained reaction of investors to the news about the trade truce between the U.S. and China, as well as cautious actions and statements of the Federal Reserve System with the subsequent rise in the yields of treasuries.

The real estate industry (XLRE: +0.57%) led the growth, while the consumer durables sector (XLY: -2.26%) was the outsider.

The financial results of major technology companies were in the focus of trading participants, which increased market volatility.

- Shares of Meta (META: -11.34%) were the day's top outsider due to plans to significantly increase operating expenses in 2026.

- Alphabet (GOOGL: +2.45%) quotes reacted positively to accelerating growth in its cloud business and an increase in large enterprise contracts.

- Microsoft (MSFT: -2.92%) ended the session lower despite strong Azure results (+39% y/y), as the most important takeaway for investors was the conservative outlook for the current quarter.

The reports of the companies mentioned above confirmed the trend of large-scale capital expenditures in the field of artificial intelligence, which intensified the discussion about the timing and sustainability of the return on these investments.

The market reacted neutrally to the unsurprising outcome of talks between US President Donald Trump and Chinese President Xi Jinping, who agreed on a year-long trade truce. This mitigates short-term risks of conflict escalation, but fundamental contradictions between the countries remain, supporting overall uncertainty.

- Cardinal Health (CAH: +15.5%) beat revenue and profit expectations for the quarter under review and raised its full-year guidance for earnings per share and free cash flow. The strong performance of the Pharmaceuticals segment was driven by sales growth.

- Eli Lilly (LLY: +3.8%) reported a better-than-forecast increase in sales volumes of its key drugs Zepbound and Mounjaro due to strong demand. This allowed the company to improve its full-year revenue and profit guidance.

- Chipotle Mexican Grill 's (CMG: -18.2%) key performance fell short of average market expectations. The company lowered its comparable sales guidance for the third time in a row, citing weaker demand from consumers with annual incomes below $100 thousand.

- eBay (EBAY: -15.9%) reported better-than-expected earnings for July through September, but its own profit forecast for the next three months came in below consensus, and the number of active buyers was unchanged from the previous quarter.

- Despite strong financial results, shares of Cigna Group (CI: -17.4%) declined significantly. Investors were concerned about the lack of customer growth compared to the previous quarter.

- Roblox (RBLX: -15.5%) reported mixed quarterly results. Its key metrics, including bookings and daily active users (DAU), beat forecasts, but average revenue per user (ABPDAU) came in below expectations, adding to investor concerns about the platform's monetization rate.

This article was AI-translated and verified by a human editor