2026-10-14 09:28

Lead: Tonight at 20:30, the U.S. releases September CPI. On Tuesday, major U.S. indices edged lower despite a cautious start to earnings season.

On Tuesday, major U.S. indices posted modest declines as the earnings season’s opening failed to drive market strength. JPMorgan missed expectations on profitability, while Citigroup and Wells Fargo faced sell-offs after their earnings reports. Chip stocks came under pressure during the session but recovered most losses in the final hour, though Micron and Applied Materials still declined notably. Apple officially launched HomeView, its new smart home device, sending shares higher before settling with only a marginal gain. Tonight’s U.S. September CPI data will test market assumptions about a potential pause in rate hikes this month.

S&P Declines 0.02%, Seven Giants Five Up, Two Down

S&P 500 fell 0.02%, closing at 7805.45; Nasdaq dropped 0.15%, ending at 27204.38; Dow Jones declined 0.35%, finishing at 51670.10. Russell 2000 slipped 0.40% to 2783.37, while VIX rose 0.39 points to 15.27, up roughly 2.62%.

Market sectors continued to diverge. Energy gained ~1.7%, communication services ~0.9%, utilities ~0.6%, materials and discretionary consumption rose; healthcare dropped 1.33%, financials fell 0.41%, industrials, consumer staples, and real estate declined, while information technology remained nearly flat. Johnson & Johnson plunged 5.73%, significantly dragging down both the healthcare sector and the Dow.

Among the seven giants, Meta advanced 2.63%, NVIDIA rose 0.97%, Microsoft gained 0.43%, Alphabet A climbed 0.30%, Apple added 0.09%; Amazon dipped 0.37%, Tesla fell 0.74%.

The Philadelphia Semiconductor Index ended down 0.2%, closing at 12208.8, marking its fifth consecutive daily decline, with intraday losses exceeding 3% at one point. The Nasdaq Golden Dragon China Index closed slightly higher.

The U.S. Treasury bond market resumed trading, with long-end yields moderating. At New York close, 2-year yield stood at 4.791%, 10-year at 5.216%, and 30-year at 5.562%.

WTI crude oil December contract rose 0.43%, settling at $94.14 per barrel; Brent December contract dropped 0.90%, closing at $105.69 per barrel. COMEX gold futures declined 0.15% to $4184.20 per troy ounce. Around 9:00 AM Beijing time today, Bitcoin hovered near $83,300, Ethereum around $2,500.

Big Banks Post Profit Growth, But Stock Prices Don’t Buy In

JPMorgan Q3 net profit reached $15.3 billion, up 6% year-on-year, with EPS of $5.57, below analysts’ consensus of approximately $5.90. Management-level revenue totaled ~$50.9 billion, with equities trading income up 49% YoY, but fixed-income trading revenue down 4%.

Investment securities losses also weighed on performance. JPMorgan recorded a pre-tax net loss of $658 million from investment securities; even excluding this item, adjusted EPS was $5.75, still falling short of expectations. The stock ultimately declined ~0.9%. The results reflect ongoing growth in trading operations, but widening disparities across business lines are becoming increasingly evident.

Goldman Sachs reported Q3 net revenue of $18.68 billion, net profit of $5.29 billion, and EPS of $17.01. Strong equity trading performance wasn’t enough to lift shares, which still dipped ~0.2%. Wells Fargo’s net interest income missed expectations, sending shares down 3.1%; Citigroup dropped 5.6%.

On the first day of earnings season, year-on-year profit growth alone failed to sustain stock momentum. Investors remain focused on revenue composition, funding costs, and forward guidance—banking stocks were the first to feel the pressure of high expectations.

AI Funding Starts Selecting Projects, Chip Stocks Remain Divergent

Micron declined ~3.62%, Applied Materials dropped 6.69%. Ongoing technological advances at Yangtze Memory Technologies continue to fuel competitive concerns, pressuring memory and semiconductor equipment stocks. Meanwhile, NVIDIA and AMD rebounded intraday, helping narrow losses in the Philadelphia Semiconductor Index.

Beyond competition, financing conditions for AI infrastructure have emerged as a new market concern. According to Bloomberg, JPMorgan and Goldman Sachs led the arrangement of a $5 billion loan for Volta, but only committed to underwriting $1.3 billion in term loans; the remaining $3.7 billion in chip-focused loans lacked underwriting guarantees.

The financing supports Norway-based data centers and GPU procurement, offering investors an estimated yield of ~11%. While both banks continue organizing the deal, they are unwilling to bear the risk of unsold portions. Companies relying on debt to purchase GPUs and lease compute power now prioritize whether financing can be secured and whether rental income can cover interest costs.

Apple Launches HomeView, $299 Battle for Home Hub Access

Apple officially unveiled HomeView, featuring a 7-inch display and A18 chip, available in desktop and wall-mount versions, both priced at $299 in the U.S., launching November 13.

The device integrates Siri AI, FaceTime, home monitoring, and smart home control, capable of recognizing up to six users and switching between personalized calendars, messages, and interfaces. Apple simultaneously updated Apple TV 4K and HomePod mini, and introduced new smart home accessories in partnership with LG Electronics and Schneider Electric.

Apple is extending Siri AI into everyday household scenarios. What matters next is whether voice interaction drives device sales and how frequently users engage with home services. The market response was restrained: Apple shares hit a new intraday high of $348.15, but finished at $341.27, up just 0.09%, with a market cap of approximately $4.98 trillion.

Williams on Rate Hikes, U.S. Yields Retreat

New York Fed President Williams stated that another rate hike this year might still be appropriate, but based on current assessments, further hikes in 2027 are not necessarily required. He emphasized that future data could alter this outlook.

Markets had previously priced in extended tightening into next year, so this commentary eased some of those expectations. Long-end U.S. Treasury yields retreated, but tonight’s inflation data could still shift pricing around this month’s FOMC meeting.

Today’s Focus

Tonight at 20:30, the U.S. releases September CPI. Markets expect headline CPI to rise ~3.6% YoY, with Reuters survey pointing to 3.7%; core CPI is projected ~2.5% YoY. Beyond energy’s contribution to overall inflation, the trajectory of core service prices remains critical to determining the Fed’s next move.

ASML, Bank of America, and Morgan Stanley report earnings. For ASML, focus will center on new orders, demand for advanced-process equipment, and forward guidance. Bank of America and Morgan Stanley will continue to be scrutinized for net interest income, trading activity, and wealth management performance.

Source: TechFlow Column