Iran Prepares For a New Strike – US Market Wrap

Stocks got hit as disappointing outlooks from Microsoft and Meta fueled concern that a nearly 45% surge in the megacaps that have powered the bull market might have gone too far. Oil jumped on a report Iran is planning a fresh attack on Israel.

A 1.9% slide in the S&P 500 wiped out the gauge’s advance for October, halting a streak of monthly gains that would have been the longest since 2021. The Nasdaq 100 dropped 2.4%. In late hours, Intel Corp. and Amazon jumped as sales beat estimates.

All megacaps retreated Thursday amid concerns on whether the cohort can sustain massive profit growth while investing billions of dollars in artificial intelligence. Those worries hit a market showing signs of exhaustion near record highs ahead of next week’s US election and the Federal Reserve decision.

Treasuries didn’t do much on Thursday, but finished lower for the month on bets the Fed won’t be too aggressive with rate cuts amid a strong economy. The dollar saw its best month since 2022. Traders are preparing for a surge in global currency volatility after the cost of hedging dollar moves over the next week climbed to the most expensive since 2020.

The yen jumped as much as 1%, extending gains seen after Bank of Japan Governor Kazuo Ueda said that currency markets have had a major impact on the economy, pointing to another potential rate hike in coming months. Chancellor of the Exchequer Rachel Reeves sought to reassure the financial markets after her budget on Wednesday triggered a selloff in UK bonds.
Gold retreated as some investors booked profit after the metal’s rally to a fresh record.