Stock Market Update

Equity futures are pointing to a mixed start, with S&P 500 futures six points above fair value and the Nasdaq 100 futures 119 points below fair value, as selling in the semiconductor space and AI trade has resumed.

Corporate developments remain active following earnings from Dow component Travelers (TRV 367.18, -16.71, -4.35%), updated guidance from Semtech (SMTC 150.00, +5.79, +4.01%), and Tesla's (TSLA 373.70, +11.26, +3.11%) Roadster unveiling. Separately, technology shares rebounded across much of Asia, while European trading has a positive bias despite hotter inflation data.

The September import and export price reports are due at 8:30 ET, followed by industrial production and capacity utilization at 9:15 ET. Those releases will provide the next read on inflation pressures and manufacturing activity.

Today's remaining economic calendar:

• 8:30 AM ET: September Import Prices; prior 0.7%
• 8:30 AM ET: September Import Prices ex-oil; prior 0.8%
• 8:30 AM ET: September Export Prices; prior 0.6%
• 8:30 AM ET: September Export Prices ex-ag.; prior 0.7%
• 9:15 AM ET: September Industrial Production; Briefing.com consensus 0.4%; prior 0.0%
• 9:15 AM ET: September Capacity Utilization; Briefing.com consensus 76.5%; prior 76.3%
• 4:00 PM ET: August Net Long-Term TIC Flows; prior -$27.9B

In corporate news:

• Alcoa (AA 41.23, +0.81, +2.00%) exceeded third-quarter earnings expectations but missed revenue estimates. Its fourth-quarter outlook includes unfavorable effects from higher raw-material costs and planned maintenance in the aluminum segment.
• Netflix (NFLX 70.30, -2.31, -3.2%) names Peter Rice Chief Content Officer, replacing Bela Bajaria, who is leaving Netflix after nearly 10 years
• Tesla (TSLA 373.70, +11.26, +3.11%) unveiled its redesigned Roadster, featuring SpaceX-developed compressed-gas thrusters and a suction system used during the demonstration, although the near-term revenue impact is limited.
• Travelers (TRV 367.18, -16.71, -4.35%) reported better-than-expected third-quarter earnings and revenue. Its combined ratio improved to 86.8%, helped by higher favorable prior-year reserve development and partly offset by higher catastrophe losses.
• Semtech (SMTC 150.00, +5.79, +4.01%) raised its third-quarter earnings and revenue guidance above consensus and outlined a fiscal 2030 framework targeting $3.2 billion in net sales.

Reviewing overnight developments:

Asian markets finished mostly higher as record TSMC earnings and stronger AI-related demand helped ease some concerns about the investment boom, according to Nikkei.

In news:

• Nikkei reported that South Korean shares drew renewed foreign buying after seven consecutive declines.
• Beijing's efforts to support equities competed with persistent China-EU trade tensions, while concerns about elevated AI valuations, Chinese competition in memory chips, and heavy capital spending remained unresolved, according to Nikkei.

In economic data:

• South Korea's September Unemployment Rate 2.6% (prior 2.7%); Import Price Index 17.6% yr/yr (prior 15.9%) and Export Price Index 40.9% yr/yr (prior 42.7%)

--- Equity Markets ---

• Japan's Nikkei: +1.4%
• Hong Kong's Hang Seng: +0.5%
• China's Shanghai Composite: +0.2%
• India's Sensex: +0.6%
• South Korea's Kospi: +2.1%
• Australia's All Ordinaries: +1.1%

European markets trade mostly higher, with broad strength outside the U.K. as lower oil prices and easing concerns surrounding AI investment and interest rates offset hotter inflation data.

In news:

• German auto shares are showing strength, while U.K. banks are under pressure amid reports of potential tax increases.
• Investors are monitoring renewed EU-China trade tensions and the possibility of European restrictions on Chinese imports.

In economic data:

• Eurozone September CPI 0.6% m/m (expected 0.6%; prior 0.4%) and 3.8% yr/yr (expected 3.8%; prior 3.2%); Core CPI 0.2% m/m (expected 0.2%; prior 0.2%) and 2.5% yr/yr (expected 2.5%; prior 2.4%); HICP excluding energy and food 2.2% yr/yr (expected 2.2%; prior 2.1%) Eurozone August Trade Balance -EUR16.1 bln (prior EUR10.7 bln)
• Italy's September CPI 0.7% m/m (expected 0.7%; prior 0.5%) and 4.2% yr/yr (expected 4.2%; prior 3.3%); HICP 2.1% m/m (expected 2.0%; prior 0.1%) and 4.2% yr/yr (expected 4.1%; prior 3.2%)
• Italy's August Trade Balance EUR1.773 bln (expected EUR7.500 bln; prior EUR8.247 bln)

--- Equity Markets --- 

• STOXX Europe 600 : +0.7%
• Germany's DAX : +1.0%
• U.K.'s FTSE 100 : +0.1%
• France's CAC 40 : +0.4%
• Italy's FTSE MIB : +1.1%
• Spain's IBEX 35 : +1.1%