North American Morning Briefing : Stock Futures Flat, Gold Prices Choppy

OPENING CALL

Stock futures were subdued Wednesday ahead of another round of big-name earnings, with gold prices volatile after posting heavy losses in the previous session.

Tesla is due to report after markets close with investors glued to Elon Musk’s conference call later.

Quarterly results will be even more closely watched given that most economic data releases have been suspended due to the government shutdown .

The Senate is set to hold a vote on extending funding Wednesday, although there is little sign the impasse will end soon.

Analysts are looking to Treasury Secretary Scott Bessent’s planned meeting with Vice Premier He Lifeng in Malaysia this week for assurances that a U.S.-China leader-level meeting is still on track .

Stocks to Watch

Barclays rose nearly 4% in London after it announced a share-buyback program and raised guidance for the year.

DraftKings said it had bought a federally licensed exchange as part of a new prediction-markets strategy. Shares rose more than 5% ahead of the opening bell.

Heineken forecast a decline in full-year beer volumes and said trade uncertainty had weighed on its U.S. performance. Still, its Amsterdam-listed shares gained.

Hermès International sank more than 4% in Paris after it reported growing sales in the third quarter but fell short of some analysts’ revenue expectations. L’Oréal also fell on disappointing sales.

Mattel dropped more than 5% ahead of the opening bell following a disappointing earnings report late Tuesday.

Netflix tumbled more than 7% in premarket trading after it reported earnings below analysts’ expectations.

Tesla is set to report earnings. Shares inched higher premarket.

Western Alliance, whose shares sold off last week on concerns about its exposure to bad loans, reassured investors on Tuesday when it reported a rise in quarterly profit. Shares gained more than 2% in premarket trading.

Watch For:

EIA Weekly Petroleum Status Report; earnings from Tesla, AT&T, GE Vernova, IBM, Thermo Fisher

Today’s Top Headlines/Must Reads:

– Is the Flurry of Circular AI Deals a Win-Win-or Sign of a Bubble?

– Democratic Donors Sit on Sidelines as Party Schism Persists

– The U.S. Is Trying to Drive a Wedge Between Argentina and China

MARKET WRAPS

Forex:

The dollar traded steady against a basket of currencies amid the uncertainty over U.S.-China tensions and the ongoing U.S. government shutdown.

ING said the greenback’s ability to extend this week’s gains looked limited .

Sterling fell after data showing U.K. headline inflation remained at 3.8% year-on-year last month. Economists in a WSJ survey expected inflation to rise to 4.0%.

ING said sterling could extend its losses as the inflation data strengthened the case for the BOE to cut interest rates further by year-end.

Bonds:

Treasury yields were steady or marginally lower amid mixed signals about progress in U.S.-China trade talks.

While Trump reiterated optimism over a deal, he also warned that a meeting with Chinese President Xi Jinping could face delays.

“U.S-China trade dynamics remain a critical driver,” DHF Capital said.

Meanwhile, there were some hopes that the U.S. government shutdown could be resolved this week but investors remained cautious, DHF added.

The Treasury’s $13 billion 20-year bond auction is likely to attract attention , though, even if the 20-year maturity isn’t investors’ favorite.

Russell Investments said 10-year Treasury yields remained near fair value even as they fell below 4%.

Its base case is that with the softening labor market, service inflation should be relatively tame, allowing the Federal Reserve to look through near-term noise and continue with another rate cut this month.

Energy:

Oil prices rose on the prospect of a U.S.-India deal that could see India gradually reduce imports of Russian crude oil, MUFG said. Despite the rebound, oil remained set for a third consecutive monthly loss on persistent oversupply fears, MUFG added.

ANZ said the U.S. Energy Department’s plans to partially refill its strategic oil reserves were supporting prices.

The U.S. plans to buy oil for delivery in December and January as it looks to boost reserves which are 60% full.

Metals:

Gold prices were volatile after tumbling Tuesday.

Spot gold fell as much as 6.3% during yesterday’s session as investors locked in profits, ANZ said. But it added that the long-term drivers of gold’s rise remained in place and will support prices.

Comex gold futures’ bullish momentum was likely taking a pause , RHB Retail Research said. The precious metal could retrace toward $4,000/oz before a rebound can emerge.

However, although a correction is in play, the overall technical setup remains bullish, RHB added.

Correction to Euro Entry in Forex Section

ING said the euro could fall to $1.16, but levels below that will be harder to justify unless Friday’s U.S. inflation data comes in higher than expected. The North American Morning Briefing: Investors Brace for Earnings Blitz on Oct. 21 incorrectly said that levels above $1.16 will be harder to justify.

   TODAY'S TOP HEADLINES 

Southwest Airlines Earnings Are Incoming. Time to Show Policy Changes Are Working.

Southwest Airlines stock has been on a turbulent round-trip this year but for the shares to fly higher into the year the carrier’s earnings late Wednesday need to show the benefits of its strategy shift.

The low-cost carrier began charging baggage fees in May for the first time in its 54-year history, along with several other new measures to boost revenue including assigned seating.

IBM Reports Earnings Today. Software Growth Can Boost the Stock.

International Business Machines stock may still have further to go despite its big rally this year. The company will report earnings after Wednesday’s market close.

According to FactSet, the consensus among analysts is for IBM to report revenue of $16.1 billion with adjusted earnings per share of $2.45 for the third quarter. Analysts’ estimate for the current quarter’s revenue is $19.2 billion, with EPS of $4.33.

Pop Mart Sales Top Market Expectation, Signals Sustained Momentum

Pop Mart reported stronger-than-expected third-quarter results, signaling sustained sales momentum which belied its shares’ recent weakness.

Pop Mart said late Tuesday that its third-quarter revenue more than tripled compared with the same period a year earlier, as sales from the Americas rocketed 1,265%-1,270%. The surge in revenue was a further acceleration from the first-half of the year and topped market expectations.

BlackRock Among Biggest Investors in Meta’s Giant Data-Center Debt Deal

BlackRock was among the biggest investors in the $27 billion private-debt deal backing construction of Meta Platforms’ data center in Louisiana, highlighting the scale of the artificial-intelligence buildout and its insatiable demand for capital.

BlackRock bought more than $3 billion of bonds issued last week to finance the data center, which is called Hyperion, according to people familiar with the matter. The project is 80%-owned by private-credit manager Blue Owl Capital, while Facebook parent Meta owns the remaining 20% stake, according to S&P Global Ratings. The bond sale was arranged by Morgan Stanley.

OpenAI’s new browser puts Google in the hot seat, and Alphabet’s stock drops

Could Alphabet Inc.’s Google Chrome be in trouble?

Shares of Alphabet Inc. GOOGL GOOG fell as much as 4.8%, before paring some of those losses, after OpenAI unveiled an artificial-intelligence browser during an event Tuesday – leading investors to wonder if the new product could take market share from Chrome.

David Zaslav’s Future Hangs in Balance as Warner Goes Up for Sale

It is David vs. Goliath in the fight for the future of Warner Bros. Discovery.

Warner Discovery Chief Executive David Zaslav is in the fight of his professional life to stop the company from being swallowed by Paramount, the rival entertainment giant controlled by David Ellison. Ellison has financial backing from his father Larry Ellison, the world’s second-richest man.

U.S. Futures, Global Markets Mixed; Sterling Slips After U.K. Inflation Data

U.S. futures and global markets were mixed ahead of another heavy earnings session, while gold recovered after falls in the prior session. Sterling fell on lower than forecast U.K. inflation data.

-U.S. futures for the S&P 500 were up 0.1% and futures for the Dow Jones Industrial Average were flat after the DJIA closed at a new record Tuesday and the S&P hit its third historic closing high after strong earnings reports.

Uncle Sam Is Taking Stakes in Companies. This New Activism Is Here to Stay.

Uncle Sam is becoming America’s most powerful investor, taking big stakes in companies to bolster supply chains and make money for taxpayers. Both goals have bipartisan support, which suggests this new shareholder activism will far outlast President Donald Trump’s administration.

Under this unfolding form of American state capitalism, the U.S. is pushing the boundaries of its legal authority to invest billions of dollars in a growing number of companies in return for stock. A third driving force is to beat China, whose control over some materials and manufacturing processes has exposed critical national security weaknesses for the U.S. amid trade tensions.

China’s ‘slow bull market’ is developing momentum as Goldman Sachs joins the party

As China’s equity market CN:SHCOMP trundles higher, talk of a “slow bull market” is developing momentum.

The concept is simple: the Chinese government would like the market to rise but prefers an orderly ascent rather than the wild ride which has often characterized its market behavior.

U.K. Inflation Unexpectedly Holds Steady

(MORE TO FOLLOW) Dow Jones Newswires

10-22-25 0638ET