Stocks mixed with tech hit on China memory competition - Newsquawk US Market Wrap

• SNAPSHOT: Equities mixed, Treasuries closed, Crude up, Dollar up, Gold down.
• REAR VIEW: Saudi Energy Ministry expects it will take 2-3 years to increase oil pipeline capacity to 10mln BPD; SBUX said it is not buying CMG; LVMH earnings underwhelm; Fed's Hammack strikes usual hawkish tone; Trump announced an agreement with Putin to lift sanctions on Russian diesel exports; Houthis struck Riyadh airport & Trump reportedly considered joining the Saudis in striking the Houthis.
• COMING UP: Data: Japanese PPI (Sep), German Final Inflation (Sep), US ADP Employment Change Weekly, Existing Home Sales (Sep). Events: RBA Minutes; OPEC MOMR. Speakers: US President Trump; BoE’s Greene; ECB's Elderson, Lane; Fed’s Waller, Barkin, Collins. Supply: Australia, Netherlands, Italy, Germany. Earnings: UnitedHealth, JPMorgan, Goldman Sachs, Wells Fargo, Citi, Johnson & Johnson.
• WEEK IN FOCUS: US CPI, US Retail Sales, Start of Q3 Earnings, China CPI, UK jobs, RBA Minutes and Aussie jobs. Click here for the full report.
• WEEKLY US EARNINGS ESTIMATES: Earnings season begins with big banks the highlights. Click here for the full report.

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MARKET WRAP

Stocks were mixed on Monday, with the Nasdaq underperforming while the Dow outperformed and the S&P 500 was little changed. Most sectors finished in the green, led by Energy and Communication Services, while Technology and Consumer Discretionary lagged, weighing on the Nasdaq. Technology stocks were pressured by weakness in chip and memory names, particularly Micron (MU), after China's CXMT announced technological progress on a denser memory chip design, raising concerns over increased competition in the sector.

It was a relatively quiet session amid the US Columbus Day holiday, although much of the newsflow centred on geopolitical and energy developments over the weekend. Trump announced an agreement with Russian President Putin to lift sanctions on Russian diesel exports in an effort to lower diesel prices for Americans ahead of the midterms. Trump also touted a potential ceasefire agreement between Russia and Ukraine, although neither side confirmed a deal, while Russia struck a Ukrainian power plant, raising further doubts over the prospect of an imminent agreement.

Crude prices were choppy but ultimately settled higher as participants digested the geopolitical developments. Prices initially came under pressure following Trump's comments on Russian diesel exports, although losses were pared amid doubts over the agreement and European criticism of the proposed sanctions relief while tensions in the Middle East also remain high. However, crude eased from its highs following remarks from Russian Deputy PM Novak, who said there was scope to make additional diesel supplies available to global markets.

Meanwhile, tensions in the Middle East remained elevated after the Houthis struck Riyadh airport in Saudi Arabia, while reports suggested Trump was considering joining Saudi Arabia in strikes against the Houthis. Regarding US/Iran relations, Iranian Supreme Leader adviser Rezaei said the US had agreed to some of Iran's seven conditions, although Tehran considered the response inadequate, while further tanker attacks were reported in the Strait of Hormuz. On the supply footing, Saudi Energy Ministry expects it will take 2-3 years to increase oil pipeline capacity to 10mln BPD

Cash Treasury trading was closed for the holiday, while T-note futures were little changed, settling one tick lower on volumes below 1mln contracts. In FX, the Dollar outperformed, with DXY rising above last Monday's high to trade at its strongest level since April 2025. CHF lagged, while CAD outperformed alongside higher oil prices, and GBP may have found some support from Burnham's calls for closer UK-EU ties. EUR weakened as attention remained on French fiscal developments ahead of the parliamentary budget debate beginning Tuesday. Gold settled lower, with some additional pressure following reports that Kazakhstan had begun selling gold reserves, as elevated Treasury yields reinforced the case for rebalancing its reserve holdings.

CRUDE

WTI (X6) SETTLED USD 1.89 HIGHER AT 93.74/BBL; BRENT (Z6) SETTLED USD 1.93 HIGHER AT 106.65/BBL

The crude complex saw gains amid renewed Middle East uncertainty, but also as Ukraine/Russia tensions ramped up. On the latter, Trump announced a US/Russia energy deal on Friday after crude settlement, and offered further punchy rhetoric over the weekend. Following this, Ukrainian President Zelensky said today that Russia attacked Ukraine following Trump's announcement, and in the winter, if Russia does not agree to an energy ceasefire, Ukraine will respond; added Russia has violated the Trump energy ceasefire. Overnight, power outages were reported in Ukraine after Russian strikes in the east of the country, despite Trump's announcement. Into settlement, WTI and Brent came slightly off highs, as they ground higher all day, after Russia's Novak, on diesel supply deal with Trump, stated there are talks between governments of Russia and US on supply and that they have possibility to make additional supplies of diesel on global markets, and by year-end Russia may reach 3-3.5mln tons of diesel exports.

In the Middle East, Saudi Arabia's energy minister has vowed a "serious" response to the deadly attacks on its oil and gas facilities by Yemen's Houthis, and Trump said he would "make a decision" about the US joining Saudi Arabia's strikes on the Houthis. On supply, Saudi Aramco's CEO warned that global crude supply remains severely tight, and upside in benchmarks was seen as Saudi Energy Ministry expects it will take 2-3 years to increase oil pipeline capacity to 10mln BPD. Note, on 6th October, Saudi Energy Minister said 5.8mln BPD was flowing through the East-West pipeline, with operations resumed around five days after the hit.

Elsewhere in the Middle East, Iranian Foreign Ministry spokesperson said exchanges of messages with the US continue via intermediaries, and Tehran is still reviewing US positions and will respond via intermediaries once the review is complete. On this, US reportedly accepted some of Tehran's 7 conditions in a response conveyed via the Qatari intermediary, but Iran deems this insufficient.

WTI traded between USD 89.61-94.36/bbl and Brent USD 102.33-107.33/bbl.

EQUITIES

CLOSES: SPX -0.05% at 7,807, NDX -0.71% at 30,665, DJI +0.41% at 51,867, RUT -0.39% at 2,796.

SECTORS: Energy +1.48%, Consumer Staples +1.22%, Communication Services +1.12%, Real Estate +0.87%, Health +0.68%, Financials +0.57%, Utilities +0.53%, Materials +0.12%, Industrials -0.07%, Consumer Discretionary -0.73%, Technology -0.90%.

EUROPEAN CLOSES: Euro Stoxx 50 +0.45% at 6,201, Dax 40 +0.72% at 25,268, FTSE 100 +0.99% at 10,656, CAC 40 +0.38% at 7,833, FTSE MIB +0.58% at 50,035, IBEX 35 +1.33% at 19,286, PSI +0.47% at 9,311, SMI +0.68% at 13,881, AEX +0.40% at 1,135

STOCK SPECIFICS:

• CCC Intelligent Solutions Holdings (CCC) is in advanced talks to be acquired by GTCR & Elliott & deal could be announced as soon as this week.
• IonQ (IONQ) to purchase Elisity in a transaction that is valued at up to $1.3bln.
• Salesforce (CRM) double upgraded at Bank of America to 'Buy' from 'Underperform'.
• Iren (IREN) quietly signed a multiyear cloud computing deal w/ Anthropic.
• Amazon (AMZN) in talks to acquire Decart AI in a deal valued c. $7bln.
• Bristol-Myers Squibb (BMY) announced Phase 3 ACTION-1 for RYZ101 met the primary endpoint.
• Solventum (SOLV) gathering initial bids for its Health Information Systems unit, and being pitched at a valuation of $5.5-7bln.
• Starbucks (SBUX) said it is not buying Chipotle (CMG) after takeover speculation.
• Meta (META) CEO said introducing Muse Wonder, our new family of frontier models with state of the art performance for personal and professional agentic work.
• Nvidia (NVDA) and Cisco (CSCO) introduced new pluggable optics form factor to scale AI factories; Nvidia and Cisco are working with TE Connectivity (TEL) and Amphenol (APH) to build a multi-source hardware ecosystem around USFP.
• Bumble (BMBL) reportedly in advanced talks to go private at a USD 1bln valuation, reports WSJ.

FX

The Dollar firmed on Monday in relatively quiet trade amid the Columbus Day holiday, with the US Treasury cash market closed and liquidity somewhat reduced. Much of the newsflow centered on geopolitical and energy developments over the weekend. Trump announced an agreement with Russian President Putin to lift sanctions on Russian diesel exports in an effort to lower diesel prices for Americans ahead of the midterms. Trump also touted a potential ceasefire agreement between Russia and Ukraine, although neither side confirmed a deal, while Russia struck a Ukrainian power plant, raising further doubts over the prospect of an imminent agreement. Meanwhile, tensions in the Middle East remained elevated after the Houthis struck Riyadh airport in Saudi Arabia, and Trump reportedly considered joining the Saudis in striking the Houthis. Regarding US/Iran relations, Iranian Supreme Leader adviser Rezaei said the US had agreed to some of Iran's seven conditions, although Tehran considered the response inadequate, while further tanker attacks were reported in the Strait of Hormuz.

In the US, Fed's Hammack reiterated her hawkish stance, arguing that further tightening is needed given the slow return of inflation towards target. However, she noted that the question for the Fed is now how quickly to make policy more restrictive, expressing a preference for smaller rate adjustments delivered relatively quickly. Attention this week largely centers on Wednesday's US CPI report, ahead of Fed Chair Warsh's speech at the IMF early Friday morning BST, with both events likely to shape expectations for the Fed's policy outlook. The DXY rose above last Monday's high of 102.53 to print a fresh 2026 peak of 102.57 at the time of writing, its highest level since April 2025.

Dollar strength weighed on G10 currencies, with CHF the clear laggard, while NZD and EUR also underperformed. For the Euro, attention remained on French fiscal developments. Bank of France Governor Moulin said the economy was holding up despite the energy shock, although uncertainty was at its highest since April, while the Bank of France maintained its Q3 growth estimate at 0.1%. Focus now turns to Tuesday's French parliamentary budget debate. ING noted that French fiscal concerns could continue weighing on the Euro into the new year, while the Fed's hawkish inflation stance should support the Dollar. The bank expects EUR/USD to trade within a 1.10-1.15 range over the coming months, although it retains a bullish outlook for the pair in 2027.

GBP was a relative outperformer, with Cable only marginally lower amid continued calls from Burnham for closer UK-EU ties. CAD losses were limited by higher crude prices, while JPY was marginally softer in subdued trade amid Japan's Sports Day holiday and the US Columbus Day holiday. Both antipodean currencies weakened against the Buck, although AUD outperformed NZD.