Wall Street is experiencing a moment of calm as U.S. stocks and gold prices show only slight movements while hovering near their all-time highs. The S&P 500 dipped by 0.1%, marking a slight retreat from its recent peak following an impressive run with eight gains in the past nine trading days. Similarly, the Dow Jones Industrial Average fell by 126 points, or 0.3%, as of 10:05 a.m. Eastern Time, while the Nasdaq Composite slipped by 0.1%.
In the commodities market, gold prices pulled back from their recent record highs after a significant rally throughout the year. Meanwhile, Treasury yields remained stable in response to shifting expectations surrounding the Federal Reserve’s interest rate policies aimed at bolstering the economy.
A notable bright spot was Delta Air Lines, whose shares surged by 6.5% after exceeding analysts’ profit expectations for the summer months. The Atlanta-based airline also forecasted a full-year profit that surpassed prior estimates. Delta’s President, Glen Hauenstein, highlighted a notable increase in sales trends over the past six weeks, particularly within the domestic business travel sector, which also buoyed the stock prices of competitors: United Airlines rose by 4%, American Airlines by 2.2%, and Southwest Airlines by 1.8%.
This earnings season is gaining importance as companies’ financial results offer crucial insights into the state of the economy, especially with the U.S. government shutdown delaying key economic reports. This marks the second consecutive week without the release of the unemployment claims update, a critical metric that typically guides Wall Street.
Investors remain cautious, particularly as valuations in the S&P 500 have surged approximately 35% since April, raising concerns over whether corporate profit growth will be adequate to sustain these elevated stock prices. The excitement surrounding artificial intelligence-related stocks has added to these apprehensions.
In contrast, Tesla shares fell by 1.8% following news that the National Highway Traffic Safety Administration is conducting a preliminary evaluation of the company’s “Full Self-Driving” system amid safety concerns.
In a significant corporate development, Akero Therapeutics saw its stock leap by 16.6% after Novo Nordisk, known for the weight-loss drug Wegovy, announced plans to acquire the South San Francisco-based biotech firm for as much as $5.2 billion contingent on regulatory approval of Akero’s leading product candidate.
MP Materials, a rare earths mining and processing company in California, climbed 5.1% after China enacted restrictions on the export of these essential materials, used in everything from consumer electronics to jet engines. Costco Wholesale’s stock increased by 2.4% following a report of an 8% revenue uptick in October compared to the previous year.
Internationally, stock markets displayed mixed results across Europe and Asia, with Shanghai’s index rising by 1.3% after trading resumed from a holiday. Japan’s Nikkei 225 gained 1.8% for a significant uptick, while technology leader SoftBank Group surged by 11.4% following the announcement of a $5.4 billion acquisition of the robotics division of Swiss engineering firm ABB.
In the bond markets, the yield on the 10-year Treasury slightly increased to 4.14%, up from 4.13% the previous day.
