On Wednesday, solid results from SpaceX (SPCX.US) and Super Micro Computer (SMCI.US) reinforced bullish sentiment around AI-related trades, driving a broad return of risk appetite and lifting all three major indexes, with the Nasdaq gaining more than 1% and Bitcoin briefly approaching $85,000.
US Equities
At the close, the Dow Jones Industrial Average rose 360.21 points, or 0.69%, to 52,856.09; the S&P 500 added 44.60 points, or 0.58%, to 7,757.17; and the Nasdaq Composite climbed 278.04 points, or 1.05%, to 26,702.85. SpaceX rose 7.7%, Tesla (TSLA.US) gained more than 3%, while SK Hynix (SKHY.US) and Nvidia (NVDA.US) each advanced more than 2%. The Nasdaq Golden Dragon China Index closed down 2.35%, with Alibaba (BABA.US) falling 3.8% and XPeng (XPEV.US) dropping 5.5%.
European Equities
The Stoxx Europe 600 rose 0.8%, Germany's DAX gained 1.2%, the FTSE 100 added 0.2%, France's CAC 40 advanced 0.9%, and the Swiss Market Index rose 0.4%.
Forex
The US Dollar Index, which measures the greenback against six major currencies, edged up 0.08% to close at 101.780. At the New York close, the euro traded at $1.1223, down from $1.1237 the previous session; the pound was at $1.3384, up from $1.3383; the dollar stood at 158.29 yen, up from 158.20 yen; 0.8254 Swiss francs, up from 0.8248; 1.4052 Canadian dollars, down from 1.4057; and 9.8985 Swedish kronor, up from 9.8979.
Cryptocurrencies
Bitcoin rose more than 2%, trading at $84,781 as of publication. Ethereum gained more than 1.7% to $2,496.
Precious Metals
Spot gold rose 0.38% to $4,140.73 an ounce, while spot silver slipped 0.03% to $57.96 an ounce.
Crude Oil
Light crude for December delivery on the New York Mercantile Exchange fell 67 cents to settle at $97.15 a barrel, down 0.68%. London Brent crude for December delivery rose 3 cents to settle at $108.82 a barrel, up 0.03%.
Macro News
Media reports say the US has recently reduced troop levels at Middle East bases to guard against an escalation of actions toward Iran. According to two US officials and two people familiar with the matter, the US military has quietly been drawing down forces at multiple bases in the Middle East in recent days, including installations in Jordan, Qatar and Kuwait. The two US officials said that on Wednesday, heads of several US diplomatic missions in the Middle East were notified that their offices would begin reducing staffing levels. The State Department had previously clarified that the diplomatic evacuations were limited to Saudi Arabia. The report said that as Trump considers resuming large-scale military operations against Iran, further withdrawing US personnel from dangerous areas is one of the plans being developed by US military officials, and the related actions could occur around the midterm elections next month. Before war broke out in February this year, the US military had withdrawn most of its forces from the Middle East to guard against Iranian retaliation. Some personnel later returned to the bases and may now be evacuated again. The US plans to keep a small number of personnel at the relevant bases responsible for air defense and security. US Central Command said the US military regularly moves personnel and equipment to optimize mission readiness but would not disclose specific movement details. An Iranian official said that if strikes resume, US political targets will be listed as targets. According to reports, a senior Iranian security official said Iran believes the US and Israel could launch an attack at any time and no longer trusts America's diplomatic gestures. US Secretary of State Rubio's remarks in Athens further deepened Iran's assessment. Iran's political and intellectual elites generally believe that US Middle East policy is dominated by Israel, and that Israel will not allow the US to seek a diplomatic solution because US President Trump has always prioritized Israel. Iran now regards itself as already at war with the US and views America's economic blockade, maritime blockade and airspace restrictions as a continuation of military aggression. Domestic pressure in Iran to break the blockade through decisive action is rising. The official said Iran has issued instructions to combat units at all levels: if a new large-scale war breaks out, including the assassination of Iranian officials or the killing of civilians, Iran will regard US political targets, belligerent parties and their infrastructure as legitimate targets. The US plans to lend out about one-third of its heating oil reserve in a bid to curb rising oil prices. The US Department of Energy said Wednesday that the Trump administration proposes lending nearly one-third of the US emergency heating oil reserve of 1 million barrels in an effort to curb surging oil prices. Heating oil is similar in composition to diesel, and diesel prices have hit a record high of more than $6.50 a gallon due to Middle East supply disruptions caused by the Iran war. A source at the department said the government will assess whether further releases of heating oil from the reserve are needed. US Energy Secretary Wright said the government is "committed to doing everything possible to lower energy costs." The department said it will conduct a loan bidding process for fuel retailers and terminal holders to ensure fuel flows to areas facing shortages. Bailey defended speaking out over Trump's attacks on Powell. Bank of England Governor Bailey said he was right to act to defend then-Federal Reserve Chairman Jay Powell from Trump's attacks and would do so again. Bailey said he and other central bank governors spoke out because the US president began targeting Powell "as an individual" rather than the institution's policies. "I only commented when I believed it was an attack on him as a person and a friend," Bailey said. "I regard Jay as a friend, and he is a person of exceptional integrity. Saying 'I'm sorry, we will support our friend' was the right response at the time, and I know I would do it again." Bailey had previously said he was "very concerned" about Trump's attacks on Fed officials, warning that any trend weakening central bank independence could spill over to other parts of the world. Putin agrees in principle to resume Russia-US-Ukraine trilateral peace talks, possibly in Abu Dhabi. According to reports, the Kremlin said Russian President Putin told US envoy Witkoff on Wednesday that he "agrees in principle" to resume trilateral peace talks between Russia, Ukraine and the US around November 10 to end the Russia-Ukraine conflict, possibly in Abu Dhabi. Witkoff held a three-hour meeting with Putin in St. Petersburg that day and submitted the latest plan to end the Russia-Ukraine conflict. Trump envoy Kushner participated in the talks via video. Witkoff told Putin that the Oslo talks had made progress and hoped both sides would consider resuming the Russia-US-Ukraine trilateral negotiations and allow technical experts to participate in discussions on specific issues. He also submitted multiple documents on a peaceful resolution of the Russia-Ukraine conflict to Putin. In addition, Putin told Witkoff he hoped to discuss the possibility of Russia playing a mediating role between the US and Iran. Putin said Russia has built decades of special mutual trust with Iran and is willing to help resolve the current crisis.
Company News
IBM revenue beat expectations as delayed orders accelerated a recovery, with software business up 8.3%. IBM (IBM.US) reported third-quarter revenue that exceeded analyst expectations. The company said most infrastructure business orders delayed earlier this year have now been signed. The results showed that for the quarter ended September 30, revenue rose about 5% year over year to $17.1 billion. Infrastructure business revenue, including mainframe servers, rose 4% to $3.7 billion, both above analysts' average estimates. IBM Chief Financial Officer Kavanaugh said about two-thirds of the mainframe and related software deals delayed earlier this year have now been signed. In July, IBM said that amid chip and server supply shortages caused by the AI boom, customers temporarily shifted spending to chips and servers, hurting its mainframe and software businesses. IBM's closely watched software business posted third-quarter revenue growth of 8.3% to $7.8 billion, above Wall Street's expectation of $7.64 billion. For the full year, IBM now expects free cash flow to increase by more than $1 billion, above its previous forecast of about $1 billion. Tesla's profit fell for a second straight quarter, while free cash flow did not turn negative. Tesla (TSLA.US) reported on Wednesday that profit fell year over year for a second consecutive quarter as the company continued to devote substantial resources to autonomous vehicles, humanoid robots and other emerging technologies. Tesla said third-quarter net income fell to $787 million from $1.4 billion a year earlier, a decline of about 44%. Revenue was $28 billion, roughly flat from a year earlier. Market expectations had projected third-quarter net income of $785 million and revenue of $27.88 billion. Musk had previously warned that Tesla's profit would be affected as the company invests resources in AI-driven autonomous driving technology and humanoid robot development. However, revenue from these new businesses remains very limited. Tesla's third-quarter free cash flow was positive at $1.53 billion, versus market expectations of negative $4.921 billion. Meta's capital spending could reach $145 billion, and it will also issue new non-voting shares. Meta Platforms (META.US) raised its capital expenditure forecast and announced plans to create a new class of non-voting stock. Both moves indicate that the social media giant is further expanding its already massive AI investments. Meta said in its quarterly earnings report on Wednesday that 2026 capital expenditure is expected to reach $135 billion to $145 billion, up from a previous range of $130 billion to $135 billion. At the same time, Meta plans to distribute the new class of shares to existing investors through stock dividends. Under the plan, existing shareholders will receive corresponding new shares, effectively amounting to a 2-for-1 stock split. Meta said it expects the new shares to begin trading in January next year. The company said the new class of stock will be used to raise capital, compensate employees and fund potential acquisitions. These moves show Meta is confident that its AI investments will ultimately generate returns. Meta's third-quarter revenue was $64.6 billion, above market expectations of $63.334 billion. Meta also expects fourth-quarter revenue of $73 billion to $76 billion, compared with analysts' previous average estimate of $73.6 billion. SpaceX beat expectations but sparked debt concerns, with credit risk indicators continuing to rise. SpaceX (SPCX.US) posted third-quarter net income of $4.4 billion, far exceeding market expectations of $1.88 billion, while revenue rose 161% year over year, sending its shares up as much as 12.4% intraday on Wednesday. But the company said it will continue to invest heavily, triggering concerns about a larger scale of future borrowing. The spread on SpaceX's 6.6% coupon bonds maturing in 2046 widened by 9 basis points to 264 basis points; the price of five-year credit default swaps (CDS) rose at one point to 232.6 basis points, repeatedly hitting new highs this month. SpaceX Chief Financial Officer Bret Johnsen said the company will focus investment on computing power for its superintelligence division and its Starlink broadband and mobile businesses, and is in talks with multiple sources of debt capital for financing. The company issued $25 billion in bonds in June, and there were earlier reports that SpaceX was in talks to raise $40 billion to buy Nvidia chips. Johnsen said the company plans to maintain an investment-grade credit rating.
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