U.S. stock markets slumped in late October, snapping a five-month winning streak as election uncertainty and mixed results from tech companies weakened risk sentiment.
The CBOE Volatility Index (VIX), a key measure of market turmoil, rose 34% last month, marking the third-largest October gain in an election year.
With the exception of Alphabet Inc. and Amazon.com Inc., the tech giants’ earnings were overwhelming. Notably, none of the other Magnificent Seven companies posted positive weekly results.
The best performing large-cap stocks this week were Charter Communications and Booking Holdings, both up about 10%. The main laggards were Advanced Micro Devices and Eli Lilly, each down about 8%.
On the macroeconomic front, the U.S. economy saw job growth surprisingly slow in October, with nonfarm payrolls increasing by just 12,000 jobs, the lowest in nearly four years and down from the expected 113,000. It was significantly lower than that.
While factors such as hurricanes and strikes likely contributed to the slowdown in employment, the unemployment rate has remained relatively stable, indicating that layoffs have not increased significantly.
Expectations for the US Federal Reserve (Fed) to cut interest rates have increased in response to the labor market report. Markets have fully priced in a 25 basis point (bp) rate cut at Thursday’s meeting, and there is an 85% chance of a similar rate cut at the Fed’s final meeting of the year in December.
bet on elections
As the 2024 US presidential election approaches, state-by-state voting odds reveal a close race between Donald Trump and Kamala Harris, with key battleground states such as Pennsylvania, Michigan, and Arizona close behind. This will hold the key to the final result.
gold continues to shine
SPDR Gold Trust saw inflows of $1.8 billion in October, the highest in more than two years. Rising investment demand continues to push gold prices towards record highs, as investors turn to this safe-haven asset in times of political concern and financial uncertainty.
Ford takes the reins of EV pickup
Ford will temporarily suspend production of the F-150 Lightning from November 18 to January 6 in response to a surge in sales of Tesla’s Cybertruck. The move is aimed at realigning production to meet demand and improving profitability for the Michigan-based automaker.
Benzinga is a financial news and data company headquartered in Detroit.
