U.S. stock futures experienced a downturn on Tuesday, following a rally seen on Monday. Futures for major benchmark indices showed a decrease across the board as investors reacted to various economic signals and corporate news.
The bond market remained closed for Veterans' Day, according to the Securities Industry and Financial Markets Association (SIFMA). This closure impacted market activity and investor focus.
Key Takeaways
- U.S. stock futures fell on Tuesday after Monday's rally.
- The Senate passed a spending bill, moving it to the House.
- The Federal Reserve may cut interest rates in December.
- Several companies reported varied third-quarter earnings.
Market Performance Overview
Futures for key indices indicated a negative start to the trading day. The Dow Jones futures were down 0.08%, while the S&P 500 futures saw a 0.24% decrease. The Nasdaq 100 futures experienced the sharpest decline, falling 0.42%, and the Russell 2000 futures were down 0.25%.
Exchange-Traded Funds (ETFs) tracking these indices also reflected the premarket sentiment. The SPDR S&P 500 ETF Trust (SPY) was down 0.18% at $680.22. Similarly, the Invesco QQQ Trust ETF (QQQ), which tracks the Nasdaq 100, declined 0.32% to $621.24 in premarket trading.
Quick Fact
The CME Group's FedWatch tool currently projects a 63.7% likelihood of the Federal Reserve implementing an interest rate cut during its December meeting, indicating significant market anticipation.
Legislative Developments and Economic Outlook
The U.S. Senate recently passed a spending bill with a 60-40 vote. The measure garnered support from nearly all Republicans in the chamber and eight Democrats. This bill now advances to the House of Representatives and will require President Donald Trump's signature to become law.
Professor Jeremy Siegel provided insights into the current economic climate, describing an economy that is "holding in" despite significant uncertainty. He highlighted the ongoing government shutdown as a primary concern.
"The shutdown has the potential to shave 1.5 to 2 or more percentage points off Q4 GDP, depending on its duration," Professor Siegel warned.
He noted that while the economy's "engine has refused to stall," the near-term "fiscal and trade outlook remains clouded by this uncertainty." This complex environment is further compounded by mixed labor data and potential volatility stemming from an upcoming Supreme Court ruling on tariff authority.
Economic Context
Financial markets are not complacent, with volatility metrics indicating that market participants are actively hedging their portfolios. Despite prevailing caution and "bearish head fakes," Professor Siegel maintains a constructive view on equities, citing persistent AI capital expenditure and the Federal Reserve's "accommodative rate cut path" as key supports.
Company-Specific News: Earnings and Strategic Moves
Several individual stocks saw notable movements in premarket trading following various corporate announcements.
Nvidia Faces Downturn
Nvidia Corp. (NASDAQ:NVDA) shares slipped 1.31% in premarket trading. This occurred after SoftBank disclosed it had sold its entire stake in the U.S. chipmaker for $5.83 billion. Despite this, NVDA has maintained a strong price trend over the short, medium, and long terms.
BigBear.ai Holdings Exceeds Expectations
BigBear.ai Holdings Inc. (NYSE:BBAI) surged by 20.32% after reporting strong third-quarter results. The company's revenue reached $33.14 million, surpassing estimates of $31.82 million. It also reported a loss of three cents per share, beating expectations for a seven-cent loss per share. BBAI shows a stronger price trend over the long term, though weaker in the short and medium terms.
Rocket Lab Soars on Revenue Beat
Rocket Lab Corp. (NASDAQ:RKLB) shares climbed 9.50%. The company posted revenue of $155.05 million, exceeding the consensus estimate of $151.75 million. Its third-quarter loss of three cents per share also beat analyst estimates of an 11-cent loss. RKLB has maintained a strong price trend across short, medium, and long terms.
Paramount Skydance Misses Earnings, Plans Layoffs
Paramount Skydance Corp. (NASDAQ:PSKY) gained 4.92% despite missing its third-quarter earnings. The company announced expected additional merger savings of $1 billion and a new round of layoffs affecting about 1,600 employees. Paramount also plans to increase the price of its Paramount+ streaming service in the first quarter of next year. The stock shows a weaker short-term price trend but strong long and medium-term trends.
LivePerson Raises Guidance
LivePerson Inc. (NASDAQ:LPSN) jumped 12.79% after reporting better-than-expected results and raising its fiscal year 2025 sales guidance. The company now projects FY2025 sales between $235.00 million and $240.00 million, an increase from its previous outlook. LPSN currently maintains a weaker price trend over all timeframes.
Outset Medical Tumbles
Outset Medical Inc. (NASDAQ:OM) shares tumbled 25.68% after reporting worse-than-expected third-quarter financial results. The company also cut its fiscal year 2025 sales guidance below estimates. OM has shown a weaker price trend across short, medium, and long terms.
Commodity and Cryptocurrency Markets
In the early New York session, crude oil futures were trading higher by 0.53%, hovering around $60.45 per barrel. Gold Spot US Dollar also saw an increase of 0.65%, reaching approximately $4,142.84 per ounce, though still below its last record high of $4,381.6 per ounce.
The U.S. Dollar Index spot was slightly higher at the 99.6220 level, up 0.03%. Meanwhile, Bitcoin (CRYPTO: BTC) was trading lower by 1.33% at $105,059.27 per coin.
Global Markets Mixed
Asian markets closed with mixed results on Tuesday. India's NIFTY 50, South Korea's Kospi, and Hong Kong's Hang Seng indices recorded gains. In contrast, Japan's Nikkei 225, Australia's ASX 200, and China’s CSI 300 indices all declined. European markets, however, showed higher trading in early sessions.
Upcoming Economic Data
Investors will monitor several key economic releases on Tuesday. These include a speech by Fed governor Michael Barr at 10:25 a.m. ET and the release of October’s NFIB optimism index at 6:00 a.m. ET.
