Stock Market Update

The S&P 500 futures are up 24 points and are trading 0.4% above fair value, the Nasdaq 100 futures are up 170 points and are trading 0.8% above fair value, and the Dow Jones Industrial Average futures are up 30 points and are trading 0.1% above fair value.

There's a positive bias in early trading as investors digest another slate of earnings news. Taiwan Semiconductor Manufacturing (TSM) shows a big pre-open gain after better-than-expected earnings and guidance. Other semiconductor-related names trade higher in front of the open in sympathy. Dow component Travelers (TRV) is another winning standout among names that reported earnings results.

This morning's calendar features a policy announcement by the ECB at 8:15 ET and September Retail Sales data for the US at 8:30 ET. Weekly jobless claims are also released at 8:30 ET.

The 10-yr yield is up one basis point to 4.03% and the 2-yr yield is up one basis point to 3.95%.

In corporate news:

• Taiwan Semiconductor Manufacturing (TSM 203.99, +16.51, +8.8%): beats by $0.15, reports revs in-line; guides Q4 revs above consensus
• Elevance Health (ELV 437.50, -59.46, -12.0%): misses by $1.29, beats on revs; guides FY24 EPS below consensus
• Travelers (TRV 259.00, +16.05, +6.6%): beats by $1.59, beats on revs, net written premiums up 8%
• PPG Industries (PPG 132.01, +1.65, +1.3%): misses by $0.02, misses on revs; guides FY24 EPS below consensus; has reached a definitive agreement to sell 100% of its architectural coatings business in the U.S. and Canada at a transaction value of $550 mln to American Industrial Partners
• Discover Financial Services (DFS 144.32, -3.21, -2.2%): beats by $0.21, net interest income increased 10% yr/yr
• CSX (CSX 33.98, -1.49, -4.2%): misses by $0.03, misses on revs; sees Q4 revs down moderately
• Alcoa (AA 44.66, +2.59, +6.2%): beats by $0.32, misses on revs
• Kinder Morgan (KMI 24.50, -0.43, -1.7%): misses by $0.02, misses on revs; lowers FY24 EPS below consensus
• Lucid Group (KMI 2.71, -0.57, -17.1%): announces public offering of 262,446,931 common stocks and corresponding investment by an affiliate of PIF; sees Q3 revs above consensus
• Uber (UBER 79.14, -2.65, -3.2%): mulling bid for Expedia, according to FT

Reviewing overnight developments:

• Equity indices in the Asia-Pacific region were mostly lower on Thursday. Japan's Nikkei: -0.7%, Hong Kong's Hang Seng: -1.0%, China's Shanghai Composite: -1.1%, India's Sensex: -0.6%, South Korea's Kospi: flat, Australia's All Ordinaries: +0.8%.
  • In economic data:
    • Japan's September Exports -1.7% yr/yr (expected 0.5%; last 5.5%) and Imports 2.1% (expected 3.2%; last 2.3%); August Tertiary Industry Activity Index -2.9 (last 3.4)
    • Australia's September Employment Change 64.1K (expected 25.2K; last 42.6K); September Unemployment Rate 4.1% (expected 4.2%; last 4.1%); NAB Quarterly Business Confidence -6 (last -1)
  • In news:
    • Chinese markets fell in response to yet another press briefing held by officials that failed to meet loftier stimulus expectations.
    • China's Housing Minister said the year-end loan quota for unfinished projects will be 4 trillion yuan compared to the 2.23 trillion that has been allocated as of October 16.
    • Japan's Nikkei slipped in the wake of relatively disappointing trade data for September that featured the first decline in exports in 10 months.
    • Nikkei, meanwhile, revealed a poll that suggested the LDP is at risk of losing its majority in the lower house following the October 27 election.
    • Australia bucked the regional trend, reacting favorably to better-than-expected September employment data.
• Major European indices are moving higher, getting an AI charge after Taiwan Semiconductor (TSM) reported better-than-expected earnings results and guidance. STOXX Europe 600: +0.7%, Germany's DAX: +0.7%, UK's FTSE 100: +0.4%, France's CAC 40: +1.2%, Italy's FTSE MIB: +1.1%, Spain's IBEX 35: +0.1%.
  • In economic data:
    • Eurozone September CPI -0.1% m/m (expected -0.1%; last 0.1%) and 1.7% yr/yr (expected 1.8%; last 2.2%); Core CPI 0.1% m/m (expected 0.1%; last 0.3%) and 2.7% yr/yr (expected 2.7%; last 2.8%)
    • Italy's August Trade Balance EUR1.431B (expected EUR5.550B; last EUR6.817B)
    • Switzerland's September Trade Balance CHF4.946B (expected CHF4.850B; last CHF4.744B)
  • In news:
    • The ECB has a policy meeting today and is widely expected at 8:15 a.m. ET to announce a 25-basis points cut to its key interest rates. A rate cut today would mark the first consecutive rate cuts by the ECB in 13 years.
    • The final September CPI report for the eurozone provided the ECB with cover to cut rates, coming in at 1.7% yr/yr.
    • Nestle reduced its full year sales and profit guidance, according to Bloomberg.