Stock Market Update

[BRIEFING.COM] The market opened to solid losses in major indices. The S&P 500 sports a 0.9% decline.

Weakness in chipmakers following fiscal Q1 guidance that failed to live up to more bullish expectations from leading chip equipment maker Applied Materials (AMAT 173.68, -12.32, -6.6%) has weighed on the broader equity market.

Total industrial production decreased 0.3% month-over-month in October (Briefing.com consensus -0.3%) following a downwardly revised 0.5% decline (from -0.3%) in September. The capacity utilization rate fell to 77.1% (Briefing.com consensus 77.3%) from a downwardly revised 77.4% (from 77.5%) in September. Total industrial production declined 0.3% yr/yr while the capacity utilization rate was 2.6 percentage points below its long-run average.

The key takeaway from the report is that industrial production in October was pressured by two extraordinary factors, but even excluding those factors, it was still relatively weak in October. The Boeing strike held down total industrial production growth by an estimated 0.2 percentage point in October while Hurricane Milton and the lingering effects of Hurricane Helen reduced industrial production growth by 0.1 percentage point.

The 10-yr yield hit 4.50% shortly after the data, but moved back to 4.48%. The 2-yr yield is up seven basis points to 4.36%.