Remy Blaire welcomes Michael Reinking, Senior Market Strategist at the NYSE, to discuss the current state of the U.S. stock market. The segment opens with a focus on the mixed opening for U.S. stock futures, highlighting a recent rally in tech stocks driven by optimism surrounding the potential end of the government shutdown, which has significantly affected consumer confidence and the broader economy.
Michael provides insights into the market dynamics, noting that the previous week saw considerable weakness in major tech names. However, a technical bounce occurred, fueled by positive sentiment regarding the government shutdown. He mentions the recent ADP jobs report, which indicates a slowdown in hiring during the latter half of October, raising concerns about the strength of the economy. This report prompts discussions about the implications for the market and investor sentiment.
The conversation shifts to negative developments within the tech sector, including CoreWeave’s earnings report, which reveals a reduction in capital expenditure forecasts and delays in construction. Additionally, Michael discusses SoftBank’s decision to liquidate positions in NVIDIA, which adds further pressure on tech stocks.
“We had CoreWeave earnings last night, where they took down some of their CapEx numbers for next year.” – 01:44
As the segment progresses, Remy and Michael look ahead to key upcoming events, including an AMD event scheduled for later in the day and several tech earnings reports throughout the week, with NVIDIA’s earnings at the end of the month being particularly noteworthy. They delve into the ongoing debate about whether AI represents a bubble, acknowledging that this conversation is likely to continue for the next several months.
The discussion also covers the anticipated economic data that will emerge following the end of the government shutdown. Michael expresses caution, suggesting that the data may be inconsistent but could provide the Federal Reserve with enough justification to consider a rate cut in December. He emphasizes the cautious approach being taken by some members of the Federal Reserve, who are seeking more data before making significant policy decisions.