The S&P 500 Index ($SPX) (SPY) today is up 0.09%, the Dow Jones Industrials Index ($DOWI) (DIA) is up 0.54%, and the Nasdaq-100 Index ($IUXX) (QQQ) is down -0.25%.  December E-mini S&P futures (ESZ25) are up 0.06%, and December E-mini Nasdaq futures (NQZ25) are down -0.25%.

Stock indexes retreated early today as the US-China trade conflict escalated further. China sanctioned five US units of South Korean shipbuilder Hanwha Ocean Co., in the latest in a series of tit-for-tat moves. Both countries have slapped special port fees on each other's vessels.  The moves have implications for the global economy, as vessels are responsible for moving more than 80% of international trade.

Stock indexes have since recovered from their worst levels, with the Dow turning positive after Walmart rose more than +4% on plans to team up with OpenAI to enable shoppers to browse and purchase products on ChatGPT.  Also, ARM Holdings Plc is up more than +2% after The Information reported that the company is working with OpenAI on the Broadcom AI chip.

The escalation of trade tensions has sparked buying of precious metals as a haven today, as gold and silver rallied to new record highs. Also, global bond markets are the recipients of haven demand from the trade turmoil as bond yields declined worldwide.  The 10-year German bund yield dropped to a 3.25-month low of 2.58% and the 10-year T-note yield fell to a 3.5-week low of 4.00%. 

Today's minor economic news showed that the US Sep NFIB small business optimism index fell -2.0 to 98.8, weaker than expectations of 100.6.

Most stock indexes rallied to record highs last week on optimism that growth in the AI sector and spending on artificial intelligence will translate into corporate profits.  Stocks are also underpinned by hopes that a resilient US economy and additional Fed easing will continue to support the economy.

In a speech today at the NABE Annual Meeting, Fed Chair Jerome Powell said, “The outlook for employment and inflation does not appear to have changed much since our September meeting,” which investors have interpreted to support additional rate cuts.

The shutdown of the US government continues, weighing on market sentiment and delaying key economic reports.  The government shutdown means delays in the release of government reports, including the last two weeks of weekly initial unemployment claims, the Aug US trade report, and the Sep nonfarm payrolls report.  Last Friday, the Bureau of Labor Statistics (BLS) said that it will release the September consumer price report on October 24 if the government shutdown continues into Wednesday, when the Sep CPI report is scheduled for release.  The White House has warned that if the government shutdown lingered, it would trigger widespread dismissals of employees in government programs that don't align with President Trump's priorities.  Bloomberg Economics estimates that 640,000 federal workers will be furloughed during the shutdown, which would expand jobless claims and push the unemployment rate up to 4.7%.

The markets this week will focus on trade or tariff news and any attempts to reopen the government. Also, major banks, including JPMorgan Chase, Goldman Sachs, Citigroup, and Wells Fargo & Co., will begin releasing their earnings results as the Q3 earnings season begins. 

Rising corporate earnings expectations are a bullish backdrop for stocks.  According to Bloomberg Intelligence, more than 22% of companies in the S&P 500 provided guidance for their Q3 earnings results that are expected to beat analysts' expectations, the highest in a year.  However, Q3 profits are expected to have risen by +7.2%, the smallest increase in two years.  Also, Q3 sales growth is projected to slow to +5.9% from 6.4% in Q2. 

The markets are pricing in a 98% chance of a -25 bp rate cut at the next FOMC meeting on Oct 28-29. 

Overseas stock markets today are lower.  The Euro Stoxx 50 fell to a 1-week low and is down -0.34%.  China's Shanghai Composite closed down -0.62%.  Japan's Nikkei Stock 225 dropped to a 1-week low and closed down sharply by -2.58%.

Interest Rates

December 10-year T-notes (ZNZ5) today are up +2 ticks.  The 10-year T-note yield is up +0.5 bp to 4.037%.  Dec -T-notes rallied to a 3.5-week high today, and the 10-year T-note yield fell to a 3.5-week low of 3.998%.  The escalation of the US-China trade conflict hammered global equity markets today, sparking safe-haven buying of government debt securities.  Also, today's -2% slump in the price of WTI crude oil to a 5.25-month low has lowered inflation expectations, a supportive factor for T-notes. T-notes also have support amid concerns about the ongoing US government shutdown, which could lead to additional job losses, reduced consumer spending, and a weakened US economy, potentially allowing the Fed to continue cutting interest rates.  

European government bond yields are moving lower today.  The 10-year German bund yield dropped to a 3.25-month low of 2.583% and is down -2.5 bp at 2.611%.  The 10-year UK gilt yield fell to a 2-month low of 4.570% and is down -7.5 bp to 4.583%.

The German Oct ZEW expectations of economic growth survey rose +2.0 to 39.3, weaker than expectations of 41.1.

ECB President Lagarde said the Eurozone economy is "in a good place" as risks to the economic outlook are more balanced and the Eurozone economy has been relatively resilient to tariffs.

UK Aug employment rose by +91,000 in the 3-months ending August, which was weaker than expectations of +125,000.  The ILO unemployment rate rose +0.1 to a 4.25-year high of 4.8% in the 3-months ending August, showing a weaker labor market than expectations of no change at 4.7%.

Swaps are discounting a 2% chance for a -25 bp rate cut by the ECB at its next policy meeting on October 30.

US Stock Movers

Chipmakers are retreating today, weighing on the overall market.  Intel (INTC) is down more than -5% to lead losers in the Nasdaq 100, and Broadcom (AVGO) is down more than -3%.  Also, Marvell Technology (MRVL) is down more than -2%, and Micron Technology (MU), ON Semiconductor (ON), ASML Holding NV (ASML), and Texas Instruments (TXN) are down more than-1%.

The Magnificent Seven technology stocks are retreating today, a negative factor for the broader market.  Nvidia (NVDA) is down more than -3% and Tesla (TSLA) is down more than -2%.  Also, Amazon.com (AMZN) is down more than -1%, and Meta Platforms (META) is down -0.73%, Microsoft (MSFT) is down -0.57%, and Apple (AAPL) is down -0.051% 

Cryptocurrency-linked stocks are under pressure as the price of Bitcoin is down by more than -3%.  As a result, Coinbase Global (COIN), Galaxy Digital (GLXY), and Strategy (MSTR) are down more than -3%, and Riot Platforms (RIOT) is down more than -1%.

Goldman Sachs (GS) is down more than -3% after reporting Q3 equities sales and trading revenue of $3.74 billion, below the consensus of $3.94 billion. 

Albemarle (ALB) is down more than -2% after Bank of America Global Research downgraded the stock to neutral from buy. 

JPMorgan Chase (JPM) is down more than -1% despite raising its full-year net interest income estimate after CEO Dimon said he sees some softness in the US economy.

Salesforce (CRM) is down by more than -1% after Northland Securities downgraded the stock to market perform from outperform.

Navitas Semiconductor (NVTS) is up more than +21% after unveiling its 100 V GaN FETs, 650 V GaN, and high voltage SIC devices for Nvidia's 800 VDC AI factory architecture.  This will enable direct conversion from 13.8 kVAC utility power to 88 VDC within the data center power room.

Polaris Inc. (PII) is up more than +10% after saying it will separate Indian Motorcycle from its portfolio into a standalone company and enter into a definitive agreement to sell a majority stake to Carolwood LP. 

Wells Fargo & Co. (WFC) is up more than +6% to lead gainers in the S&P 500 after reporting Q3 revenue of $21.44 billion, above the consensus of $21.16 billion. 

Walmart (WMT) is up more than +2% to lead gainers in the Dow Jones Industrials after saying it was teaming up with OpenAI to enable shoppers to browse and purchase products on ChatGPT. 

Domino's Pizza (DPZ) is up more than +2% after reporting Q3 total domestic stores comparable sales growth of 5.2%, which is better than the consensus of 4.28%. 

ARM Holdings Plc (ARM) is up more than +2% after The Information reported that OpenAI is working with the company on the Broadcom AI chip.

Earnings Reports(10/14/2025)

Albertsons Cos Inc (ACI), Blackrock Inc (BLK), Citigroup Inc (C), Domino's Pizza Inc (DPZ), Goldman Sachs Group Inc/The (GS), Johnson & Johnson (JNJ), JPMorgan Chase & Co (JPM), Wells Fargo & Co (WFC).