Stock Rally Fades Ahead of Inflation; Gold Slips: Markets Wrap
(Bloomberg) — The global stock rally stalled as investors weighed the potential impact of upcoming US inflation data while parsing a flood of mostly positive earnings news.
Futures on the S&P 500 and Nasdaq 100 erased early gains, suggesting Monday’s Wall Street rally of more than 1% is set to fizzle. A gauge of the dollar rose for a third day as the greenback advanced against all Group-of-10 peers. Gold and silver slid in a strong retreat from recent highs as the dollar strengthened.
The S&P 500 has logged its biggest two-day gain since June as the third-quarter earnings season gets into full swing, with about 85% of US firms beating profit estimates so far. While the US government shutdown has caused an economic data vacuum, creating uncertainty about the Federal Reserve’s policy path, drawdowns have been short-lived, as investors see them as opportunities to add risk to their portfolios.
“Another day, another dearth of US data, as the government shutdown continues, with no end in sight,” said Michael Brown, a senior research strategist at Pepperstone Group Ltd. “To my mind, the path of least resistance continues to lead to the upside, and dips remain buying opportunities.”
Among companies that reported on Tuesday:
General Electric Co. advanced in premarket trading after raising its full-year outlook for a second consecutive quarter as the jet-engine manufacturer cashes in on strong air-travel demand. Elevance Health Inc. shares gained after the health insurer posted third-quarter profit that was ahead of expectations. Peers UnitedHealth Group Inc., Centene Corp. and Molina Healthcare Inc. also rose. General Motors Co. surged after raising its full-year outlook and posting third-quarter results that topped Wall Street estimates on better-than-expected pickup truck sales and fresh relief from the Trump administration’s tariffs on auto parts. Halliburton Co. rose after the energy-services company reported third-quarter revenue that beat the average analyst estimate. The Coca Cola Co. gained after posting third-quarter sales growth that beat Wall Street expectations — a sign that consumers are snapping up the company’s beverages despite higher prices. RTX Corp. rose after the aerospace and defense company raised its full-year guidance, citing “ongoing” strong demand for its products. PulteGroup Inc. fell after the home builder reported a decline in third-quarter revenue and net new orders. The US Bureau of Labor Statistics is set to release September’s consumer price index on Friday, after a delay due to the government shutdown. The data, originally slated for Oct. 15, will give Fed officials a key reading on inflation ahead of their Oct. 30 policy meeting. The Treasury 10-year yield traded below 4%.
The data may take on greater importance due to the government shutdown-driven data drought, said Rick Gardner at RGA Investments. He still sees a Fed cut in October and noted that a key test will be Big Tech earnings, with investors looking for clarity on how spending on artificial intelligence is leading to profitability.
“While earnings will remain in focus, particularly any updates on demand trends, international exposure post-tariffs, and their impact on profitability and capex, I think this week’s key events will be the inflation releases in the UK and US,” said Susana Cruz, a strategist at Panmure Liberum, “Both are still running hot and expected to rise further. Any upside surprises there could easily derail the rally.”
The Stoxx Europe 600 index was little changed, hovering near a record high. Miners were the biggest decliners after prices of gold and silver slumped due to the stronger dollar.
What Bloomberg Strategists say…
“The abrupt turn lower in gold prices weighed on equity markets given their correlation of late, but stocks should be able to shake it off pretty quickly. …That correlation is only likely to hold up in the very short term however as the gold prices won’t have much impact on the long term profitability of the large majority of firms (miners being the obvious exception).”
— Conor Cooper, Macro Squawk. Click here to read the full analysis.
Among individual movers in Europe, Eurofins Scientific SE dropped 9% after third-quarter results. Edenred SE jumped as much as 15%, the most on record, after the digital platform for services and payments reported better revenue growth for the third quarter. Assa Abloy AB gained as much as 3.4% after the Swedish lock and entrance systems group reported reassuring results.
Japanese stocks were volatile and the yen dropped 0.5% after Sanae Takaichi won a parliamentary vote to become prime minister, opening the way for more fiscal spending.
The benchmark Nikkei 225 had nearly hit 50,000 earlier Tuesday, Pictet Asset Management Japan Ltd. head of investment strategy Jumpei Tanaka said, adding that “some profit-taking likely emerged as a reaction to that earlier rally.”
Some of the main moves in markets:
Stocks
S&P 500 futures were little changed as of 8:24 a.m. New York time Nasdaq 100 futures were little changed Futures on the Dow Jones Industrial Average were little changed The Stoxx Europe 600 rose 0.1% The MSCI World Index was little changed Currencies
The Bloomberg Dollar Spot Index rose 0.3% The euro fell 0.3% to $1.1609 The British pound fell 0.2% to $1.3379 The Japanese yen fell 0.8% to 152.03 per dollar Cryptocurrencies
Bitcoin fell 1.5% to $109,428.59 Ether fell 2.1% to $3,917.55 Bonds
The yield on 10-year Treasuries declined one basis point to 3.97% Germany’s 10-year yield declined one basis point to 2.57% Britain’s 10-year yield declined two basis points to 4.48% Commodities
West Texas Intermediate crude rose 0.8% to $57.98 a barrel Spot gold fell 3.1% to $4,221.93 an ounce This story was produced with the assistance of Bloomberg Automation.
–With assistance from Anand Krishnamoorthy, Eman Abouhassira and Jan-Patrick Barnert.
©2025 Bloomberg L.P.
