Incumbent British PM Rishi Sunak Vows to Weather “Profound Economic Crisis

Despite today’s mixed market behavior, yesterday U.S. equities rallied for a third straight day as more top earnings were posted including those of the biggest names in the tech sector. However, U.S. tech stocks tumbled in after-hours trading after the industry’s stalwarts reported disappointing results, undermining hopes that this year’s $5.5 trillion selloff had reached its bottom. Google parent Alphabet (GOOGL) fell as much as 7.4% after its Q3 revenue came in below expectations, while software giant Microsoft Corp. (MSFT) lost a whopping 8.1% (its stock is additionally shedding 7.68% at the time of writing today) following a disappointing revenue forecast. Texas Instruments (TXN), a bellwether for the semiconductor industry, tumbled 6.1% after giving a forecast that was weaker than analyst estimates. Today, Investors will get another read on the outlook for the tech industry as Facebook parent Meta delivers earnings today. Daimler-Benz also reports. Meanwhile, U.S. President Joe Biden will hold a bilateral meeting with Israeli President Isaac Herzog.

The falling bond yields helped lift shares of American Express (AXP), however, to rise 3%, and shares of other credit card providers were up as well. Boeing (BA) shares also added 3%, and today they have further advanced by 1.47%. Nike (NKE) shares soared 4% (today’s addition so far is another 0.8%) after rival Adidas (ADS.DE) severed ties with celebrity rapper Kayne West, who was a major revenue producer for the German athletic wear maker.

Shares of Coca-Cola (KO) and General Motors (GM) are also performing nicely, as their quarterly results exceeded expectations. Shares of more widely-held tech stocks, including Apple (AAPL), Salesforce (CRM), and Tesla (TSLA), climbed. PayPal (PYPL) shares jumped following a deal with Amazon (AMZN) that lets Amazon shoppers pay for purchases with PayPal’s Venmo service.

Commoditywise, crude oil prices traded slightly higher as Brent crude futures rose 1.69% to trade at $94.93 per barrel, while U.S. WTI crude futures rose 1.83% to $86.75 a barrel at the time of writing. The American Petroleum Institute, yesterday, reported crude inventory in the U.S. rose 4.5 million barrels during the week ended 21st October. The Energy Information Administration’s weekly report on petroleum inventories in the U.S. will be released any minute now at 10:30 a.m. EST.

As of 4:10 p.m. CET, European stocks are trading little changed. The Pan-European Stoxx Europe 600 Index is sliding just 0.06%, the British FTSE 100 is trading nearly unchanged, while the German DAX is advancing by 0.35%, and the French CAC 40 Index rose 0.25%. Incumbent Prime Minister Rishi Sunak named an experienced Cabinet to lead the UK through what he called a “profound economic crisis”. Sunak confirmed Jeremy Hunt would remain Chancellor of the Exchequer as the new premier vows to fix the economic mistakes made by predecessor Liz Truss. But Downing Street was unable to confirm if Hunt would maintain his plan to outline the government’s spending and tax strategy on Oct. 31. That fiscal statement is seen as crucial ahead of a Bank of England interest-rate decision a few days later.

Elsewhere, Asian markets traded higher earlier today. Japan’s Nikkei 225 rose 0.67%, China’s Shanghai Composite Index advanced by 0.78%, while Hong Kong’s Hang Seng Index climbed 1 and Australia’s S&P/ASX 200 rose 0.2%. The index of coincident economic indicators in Japan increased to 101.8 in August from a final reading of 100.1 in July, while the index of leading economic indicators climbed to 101.3 in August compared to a final of 98.9 in July. In Q3 2022, the annual inflation rate in Australia rose to 7.3% from 6.1% in the prior quarter.