Market review from UTEX — week 41
New jobs came in three times below forecasts. The market no longer expects a rate hike in October.
Major U.S. indices closed the week mixed: the SPY lost 0.22%, while the Nasdaq gained 0.68%. Top gainers among the largest companies: Applied Materials (+11%), Lam Research (+10%), KLA (+10%), Palo Alto Networks (+7%), CrowdStrike (+7%). Top decliners: AstraZeneca (-5%), Netflix (-5%), Johnson & Johnson (-5%), GE Aerospace (-5%).
A particular disappointment was Nike's weak report — the stock lost more than 5% over the week, and NKE is down 54% for the year.
The jobs report showed a sharp slowdown in hiring. Instead of the expected 85,000–90,000 nonfarm jobs, the U.S. economy created only 29,000 jobs in September. The official unemployment rate unexpectedly rose to 4.2% (vs. a forecast of 4.1%).
Against this backdrop, expectations for a Fed rate hike at the next meeting on October 28 fell to 20% from 70% a week earlier.
On Tuesday, Marvell Technology will hold an investor day significant for the AI sector, where the company will update its long-term financial targets. Management plans to disclose financial details of a multibillion-dollar partnership with Google for the supply of custom AI accelerators, as well as projects for Microsoft, Amazon, and Meta.
On Wednesday, the minutes of the September Fed meeting will be released. The new earnings season kicks off on October 13, and there is still time to sum up results and prepare for the release of fresh company results.
There will be very few reports; one can highlight Constellation Brands, RPM International, Levi Strauss, PepsiCo, and Delta Air Lines.
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