Good morning. The Nasdaq rose 1.1% Monday as investors bought back chip and AI stocks, but the average S&P 500 stock fell: the equal-weighted version of the index slipped 0.3% (CNBC; Reuters). Overnight, S&P 500 futures are flat and Nasdaq-100 futures are down 0.3%, Seoul's Kospi closed down 3.7% as Asian chip stocks slid, and homebuilder confidence sits at its lowest since 2012 ahead of housing starts at 8:30 AM ET.
📊 The Overnight Snapshot
Market | Last | Change |
|---|---|---|
S&P 500 futures | 7,736.00 | ▲ 1.50 pts (+0.02%) |
Nasdaq-100 futures | 29,633.75 | ▼ 88.75 pts (−0.30%) |
Dow futures | 52,287 | ▲ 105 pts (+0.20%) |
S&P 500 | 7,690.73 | ▲ 0.41% (+31.29) |
Nasdaq Composite | 26,430.89 | ▲ 1.11% (+290.85) |
Dow | 51,966.03 | ▼ 0.07% (−36.38) |
Russell 2000 | 2,728.30 | ▲ 0.25% (+6.93) |
VIX | 18.44 | ▼ 1.55 pts |
US 10Y yield | 5.15% | ▲ 6 bp |
US 2Y yield | 4.77% | ▲ 3 bp |
WTI oil (Nov) | $104.03 | ▲ 0.4% (vs. $103.66 Mon settle) |
Brent oil | $110.33 | ▲ 0.7% (vs. $109.55 Mon settle) |
Gold | $4,140.30 | ▼ 0.5% (vs. $4,160.10 Mon settle) |
Bitcoin | $81,447 | ▼ 1.4% |
Ether | $2,388 | ▼ 1.7% |
Nikkei 225 (Tue close) | 64,075.42 | ▼ 1.3% (−841) |
Kospi (Tue close) | 5,552.74 | ▼ 3.7% (−215) |
Stoxx 600 (Tue, live) | 635.34 | ▼ 0.7% (−4.22) |
One-line read: US futures are flat to lower, and the chip selling moved to Seoul and Tokyo.
🌙 What Happened While You Slept
Tech Bounced. Most Stocks Didn't.
The Nasdaq Composite rose 1.11% to 26,430.89 Monday and the S&P 500 added 0.41% to 7,690.73, as investors bought back the chip and AI stocks they dumped last week (CNBC). The Dow slipped 0.07% to 51,966.03. The PHLX Semiconductor Index rose 1.6%, ending an eight-day losing streak in which it fell about 15.7%, its longest run of declines since October 2008 (Reuters). Micron gained 3.0%, Marvell 4.1%, Intel 2.4% after a JPMorgan upgrade and Nvidia 1.4% (CNBC). The biggest lifts came from Amazon, up 5.0% after Morgan Stanley named it a "top pick," and Tesla, up 3.8% (Reuters). CoreWeave, the center of last week's selloff, slipped 0.4% after giving up early gains that followed a Goldman Sachs upgrade, and its credit default swaps stayed at distressed levels (Reuters; CNBC).
The numbers: The rally was narrow. The equal-weighted S&P 500, where every member counts the same, fell 0.34% (CNBC). Seven of 11 S&P 500 sectors fell, led by utilities, down 2%, and real estate, down 1.2%, while consumer discretionary rose 2.7% (Reuters). Banks slid: Wells Fargo lost 2.5%, Citigroup 2.1% and JPMorgan 1.8% (CNBC). On the NYSE, falling stocks outnumbered rising ones 1.69 to 1, and the Nasdaq logged 361 new lows vs. 31 new highs (Reuters). Volume was light at 15.27 billion shares vs. a 20-day average of 17.26 billion (Reuters). The VIX, Wall Street's fear gauge, fell 1.55 points to 18.44 (CNBC).
Why it matters: An S&P 500 fund rose Monday even though its average member fell, because the index weights companies by market value and the gains came from heavyweights (Reuters). The S&P 500 is 1.6% below its Oct. 6 record close and up 12.3% this year (FRED; our math). "Investors are buying the correction dip that we had," Spartan Capital's Peter Cardillo told Reuters. Rosenblatt's Michael James was less sure, calling the market "far from out of the woods." A rebound with a short guest list.
What to watch: Nasdaq-100 futures are down 0.3% as of ~3:42 AM ET, giving back part of Monday's bounce (CNBC). SpaceX and Netflix report after today's close, and Meta and Tesla follow Wednesday.
🔑 3 Things to Know Before the Open
Homebuilders are the gloomiest since 2012. The NAHB/Wells Fargo Housing Market Index fell three points to 29 in October, its lowest reading since June 2012 (NAHB). Economists polled by Reuters expected 31. A gauge of buyer traffic fell five points to 18, its lowest since April 2012 outside the pandemic's onset, and 43% of builders cut prices, the highest share in NAHB's 2020–2026 data (NAHB). "Mortgage rates have climbed well above 7% in recent weeks," NAHB Chairman Bill Owens said. The average 30-year mortgage rate was 7.40% last week, the highest since November 2023 (Freddie Mac via FRED). Builder stocks fell: D.R. Horton lost 2.9%, PulteGroup 2.3% and the iShares US Home Construction ETF 1.7% (CNBC). An ETF of mortgage real estate investment trusts hit its lowest level since April 2020 (CNBC). September housing starts come at 8:30 AM ET; August's ran at a 1.275 million annual rate, down 2.6% from July (Census Bureau), and economists polled by Reuters expect 1.305 million (Reuters). Pending home sales follow at 10:00 AM ET (NAR). Why it matters: On a $400,000 loan, 7.40% works out to about $2,770 a month in principal and interest (our math, Freddie Mac rate). If you own a home, those builder discounts on new houses are the competition your resale price is up against.
SpaceX and Netflix report after the close. SpaceX posts third-quarter results after the close, with an audio webcast at 4:30 PM ET (SpaceX). Its shares rose 1.3% to $147.96 Monday (CNBC). Netflix also reports after the close, with its call at 4:45 PM ET; analysts expect earnings to grow 40% from a year earlier (LSEG via CNBC). Netflix's stock has struggled after its last five reports, and last week the company said it would cut about 1,000 jobs, or 6% of its workforce (CNBC). United Airlines reports after the close too, with its call Wednesday at 10:30 AM ET; analysts expect revenue growth of more than 15% but lower earnings per share than a year ago (LSEG via CNBC). Before the open: GE Aerospace (webcast 7:30 AM ET), General Motors (call 8:30 AM ET) and RTX (call 8:30 AM ET) (GE Aerospace; CNBC; RTX). For GM, analysts expect earnings per share to jump nearly 30% on flat revenue (LSEG via CNBC). Why it matters: About 70 S&P 500 companies report this week (CNBC). United's fuel bill, GM's car buyers and Netflix's subscribers are three different reads on how $100 oil and 7% loans are landing on companies that sit in an S&P 500 fund.
US crude rose 2.2% to $103.66. US crude for November delivery rose 2.2% to settle at $103.66 a barrel Monday, after Yemen's Iran-aligned Houthis said they attacked Saudi energy, airport and military targets, including an Aramco site in Yanbu; Saudi authorities did not confirm the claims (Reuters). Brent slipped 0.3% to $109.55 after touching $110.70, its highest since May 20 (CNBC; Reuters). The November contract expires today; the more-active December contract was up 0.6% at $99.14 as of ~3:42 AM ET, and Brent was up 0.7% at $110.33 (Reuters; CNBC). Markets are also weighing President Trump's Friday order waiving key Russia-related sanctions and tariffs, though he said Saturday that he has yet to announce a final decision (Reuters). Treasury yields rose: the 10-year added 6 bp to 5.15% and the 2-year 3 bp to 4.77% (US Treasury), as easing AI worries cooled last week's rush into bonds (Reuters). Fed officials are in their quiet period before the Oct. 27–28 meeting (Bloomberg). Fed funds futures put an 83% chance on no change in October and a 90% chance on a higher target by the Dec. 9 meeting (CME FedWatch, as of ~3:40 AM ET). Why it matters: Regular gasoline averaged $4.33 a gallon in the week of Oct. 12 (EIA via FRED). Pricier oil feeds inflation, inflation keeps a Fed hike on the table, and the Fed's rate sets what savings accounts pay and new loans cost.
📈 Chart of the Day
Builder confidence is at a 14-year low. For context, a reading above 50 means more builders call sales conditions good than poor; the index was 37 a year ago and 90 at its November 2020 peak. Notice where it is now: 29, a level last seen in June 2012, though still far above the 2009 low of 8. Source: NAHB/Wells Fargo Housing Market Index (seasonally adjusted), NAHB Table 2, January 2007 to October 2026, released Oct. 19, 2026. October is preliminary.
⚡ Quick Hits
Steel: Cleveland-Cliffs jumped 16.3% to $14.10 after its third-quarter profit beat analysts' estimates (Reuters; CNBC).
Downgrade: Ameriprise Financial fell 4.1% to $480.41 after Bank of America cut it two notches to underperform, citing large teams of financial advisers leaving (CNBC).
Regional banks: Fifth Third earned $0.90 a share, or $1.13 adjusted, while integrating Comerica, and its stock rose 0.3% (Fifth Third; CNBC). After the close, Zions reported $1.78 a share vs. $1.48 a year earlier as net loan charge-offs fell to $3 million from $56 million; its shares were up 0.5% in late trading (Zions; CNBC).
France: Paris stocks fell about 1% and the euro slipped after weekend riots led the government to impose curfews in parts of Paris and other cities (Reuters). France's 10-year borrowing costs are near their highest since 2002 (CNBC). Early Tuesday, the CAC 40 was down 0.5% and Europe's tech stocks 1.4% (CNBC).
Asia: Asian chip stocks fell despite Monday's US rebound: SK Hynix closed down 4.2% and SoftBank Group 6.0% (Yahoo Finance; CNBC). In Seoul, AI infrastructure company Elice Group sank nearly 30% below its IPO price on its first day (Reuters). Indonesia's Jakarta Composite was up 3.8% late in its session after the exchange announced plans to drop companies with highly concentrated ownership from the index (Yahoo Finance; CNBC).
IPO: The anchor portion of Indian telecom company Jio Platforms' IPO, which aims to raise up to $3.2 billion, drew bids of about $26.3 billion, more than 30 times the shares on offer, according to a source familiar with the matter (CNBC).
Anniversary: Monday was the 39th anniversary of Black Monday, the 1987 crash that remains the biggest one-day decline in the Dow's history (Reuters). This year, the Dow's Oct. 19 was a 0.07% dip.
Crypto: Bitcoin near $81,447 as of ~3:52 AM ET (−1.4% vs. its 24-hour open); Ether near $2,388 (−1.7%) (Coinbase).
🧠 Explain Like I'm Busy
How can the S&P 500 rise when most stocks fall?
The regular S&P 500 weights each company by its stock market value, so a 1% move in a giant counts for far more than a 1% move in a small member. The equal-weighted S&P 500 holds the same companies but gives each roughly the same slice, about 0.2% each (our math: 1 divided by about 500). On Monday, the first rose 0.41% and the second fell 0.34% (CNBC). Think of a room's average income when a billionaire walks in: the average jumps, but nobody else got a raise. When the two versions split like this, a handful of big names is carrying the index.
🗓️ Today's Catalysts (all times ET)
Day | Event | Why it matters |
|---|---|---|
Tue Oct 20 | GE Aerospace before the open, webcast 7:30 AM (GE Aerospace); GM, call 8:30 AM (CNBC); RTX, call 8:30 AM (RTX) | Jet engines, defense and car buyers before the bell. |
Tue | Housing starts and building permits for September, 8:30 AM (Census Bureau) | Whether builders' gloom is showing up in construction. |
Tue | Pending home sales for September, 10:00 AM (NAR) | Contracts signed on existing homes at 7%+ mortgage rates. |
Tue | SpaceX after the close, webcast 4:30 PM (SpaceX); Netflix, call 4:45 PM, and United Airlines after the close (CNBC) | Rockets, streaming and jet fuel in one evening. |
Wed Oct 21 | AT&T before the open (CNBC); Meta (call 4:30 PM) and Tesla (webcast 5:30 PM) after the close (Meta; Tesla); Lam Research and Texas Instruments also report (Reuters) | The week's big AI and chip test. |
Thu Oct 22 | Weekly jobless claims, 8:30 AM (Labor Department); Procter & Gamble and American Airlines before the open (CNBC) | Layoffs, shoppers and fuel costs. |
Fri Oct 23 | American Express reports, ~7:00 AM (American Express) | A read on how card spenders are handling higher prices. |
Oct 27–28 | FOMC meeting (Federal Reserve) | Rates decision; target now 3.75%–4.00%. |
Wed Nov 11 | Veterans Day: bond market closed (SIFMA); stock market open (NYSE) | No Treasury trading that day. |
That's the desk. See you tomorrow (Wednesday) at 6 AM ET.
— The Overnight Desk Team
Note: The Overnight Desk Team may hold positions in assets discussed. Nothing here is investment advice. · Sponsor: No one paid for any mention in this issue.
