Dow, S&P 500, Nasdaq rise as tech rebounds, Supreme Court questions Trump tariffs
US stocks recovered from the previous day’s steep sell-off as the ADP payrolls report showed a return to job growth in the private sector last month. Investors were also eyeing a pivotal day for President Trump’s tariffs, while the federal shutdown became the longest in US history.
The S&P 500 (^GSPC) pushed up by 0.4%, and the tech-heavy Nasdaq Composite (^IXIC) rose 0.7%. The Dow Jones Industrial Average (^DJI) jumped 0.5%.
Tech (XLK) and Consumer Discretionary (XLY) stocks led the gains as shares of Tesla (TSLA) jumped ahead of the EV maker’s shareholder meeting on Thursday.
Stocks made a broad recovery amid several macroeconomic storylines playing out Wednesday. First, an ADP report showed private-sector employment increased by 42,000 in October — topping expectations after two months of declines. The labor data will likely feed into the Federal Reserve’s thinking amid an ongoing data blackout from the government shutdown.
The Fed’s newest voting member, Stephen Miran, told Yahoo Finance on Wednesday that he favors a cut at the central bank’s December meeting, even as a growing chorus of officials have suggested a potential pumping of the brakes.
Meanwhile, on the trade front, the Supreme Court heard arguments on Wednesday in a case questioning Trump’s legal authority to impose his sweeping tariffs — a landmark test of presidential power. The high court’s justices questioned the president’s authority to levy the duties on a broad basis, leaving their fate in seeming jeopardy.
Also, the US shutdown is now the longest ever after entering its 36th day on Wednesday. Economic pain from the stoppage continues to mount, with the hit estimated at $15 billion a week, as Trump administration officials warn of potential “mass chaos” for air travelers.
Fears of a stock bubble continue to stalk markets after Tuesday’s sell-off, with eyes now on Qualcomm (QCOM) for more clues to the AI trade as the chipmaker’s results are slated after the market close. Elsewhere in earnings season, McDonald’s (MCD) posted a US sales beat but flagged “consumer headwinds.”
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Stocks rise as tech rebounds, High Court questions Trump tariff power
Stocks jumped on Wednesday, partially recovering from losses in the prior session after better-than-expected private payroll data and questions from the Supreme Court over President Trump’s tariff powers.
The S&P 500 (^GSPC) rose 0.3%, while the tech-heavy Nasdaq Composite (^IXIC) rose 0.65%. The Dow Jones Industrial Average (^DJI) increased 0.4%.
Tesla (TSLA) shares rose nearly 4% as the EV giant awaited an important shareholder vote over CEO Elon Musk’s proposed compensation package.
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Robinhood earnings after bell set to test stock’s 280% rally
Robinhood (HOOD) is set to report earnings after the bell on Wednesday, with Wall Street expecting blockbuster results from the trading platform that has seen its stock serve as the S&P 500’s (^GSPC) top performer this year.
Analysts expect Robinhood to post adjusted earnings of $0.53 per share on $1.2 billion in revenue for the third quarter, nearly double the $637 million reported in the same period last year.
Shares of the Menlo Park, Calif.-based company have surged nearly 40% since joining the S&P 500 in September and are up 280% year to date, the best among constituents in the index. Robinhood stock was up 4% on Wednesday ahead of the announcement.
The stock’s rally has been fueled by new product launches this year, ranging from tokenized stocks in Europe to prediction markets and crypto staking, as Robinhood aims to grow customer wallet share.
Read more here.
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Bitcoin jumps to $104,000 amid market rebound
Bitcoin (BTC-USD) rebounded on Wednesday after slipping to its lowest level since June in the prior session.
The world’s largest cryptocurrency climbed above $104,000, trimming losses from Tuesday when it briefly slipped below $100,000.
Investors appeared to move risk-on again as private payroll data released on Wednesday morning came in better than expected, while diffeFed governors have been making the rounds this week on the prospects of a December rate cut.
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10-year yield hits 4.15% as Treasurys sell off
Treasurys sold off on Wednesday following some positive signals on the US economy from private payrolls data and US services PMI, and after the Treasury Department issued its quarterly refunding statement.
The 10-year yield (^TNX) climbed 6 basis points to hit 4.15%, its highest level in about a month. Meanwhile, the 30-year bond (^TYX) also rose 6 basis points to 4.73%. The 5-year yield (^FVX) reached 3.75%.
Treasury prices and yields have an inverse relationship, meaning higher yields correlate with falling bond prices.
On Wednesday, the Treasury Department said it would maintain bond sales for now but is considering increasing bond sizes in the future.
“Looking ahead, Treasury has begun to preliminarily consider future increases to nominal coupon and FRN auction sizes, with a focus on evaluating trends in structural demand and assessing potential costs and risks of various issuance profiles,” the statement read.
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Gorsuch leads conservative questioning of government over tariffs
Several of the Supreme Court’s conservative-leaning justices questioned a US government lawyer over President Trump’s authority to impose tariffs on trading partners, casting early doubt over their future.
Justice Neil Gorsuch, a Trump appointee, drew the most notice for his line of questioning to US Solicitor General D. John Sauer. Gorsuch posed a hypothetical in the case of a theoretical future Democratic president.
“Could the president impose a 50% tariff on gas-powered cars and auto parts to deal with the unusual and extraordinary threat from abroad of climate change?” Gorsuch asked.
Sauer responded that it was “very likely.”
Gorsuch also questioned Sauer over the president’s ultimate authority and when Congress could delegate it to the executive.
“What would prohibit Congress from just abdicating all responsibility to regulate foreign commerce — for that matter, declare war — to the president?” he asked.
Chief Justice John Roberts, along with Justices Amy Coney Barrett and Brett Kavanaugh — the latter two of whom were appointed by Trump — also at times posed skeptical questions. Kavanaugh asked why no president before Trump had invoked this authority, while Barrett questioned the across-the-board nature of the tariffs.
Prediction markets have grown much more bearish on the odds of Trump prevailing in this case.
Polymarket has odds of the Supreme Court ruling in favor at 23%, down from around 40% before the oral arguments. Odds on Kalshi took a similar dive. On PredictIt, bettors saw about 80-20 odds that the court would “strike down” the tariffs.
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Fed’s Miran: Cutting interest rates again in December would be ‘a reasonable action’
Newly appointed Federal Reserve governor Stephen Miran told Yahoo Finance’s Jennifer Schonberger on Wednesday that continuing to cut rates at the Fed’s December meeting would be “reasonable.”
Miran’s comments come after Chicago Fed president Austan Goolsbee, Federal Reserve governor Lisa Cook, and San Francisco Fed president Mary Daly suggested they are undecided about whether to cut interest rates in December,.
Schonberger reports:
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Rivian stock surges after Q3 beat, R2 midsize SUV on track for 2026
Rivian stock spiked more than 16% on Wednesday.
Yahoo Finance’s Pras Subramanian reports:
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AMD stock in focus after Q3 report fails to wow investors
AI chipmaker Advanced Micro Devices (AMD) saw its stock waver on Wednesday after the Nvidia rival reported third quarter earnings that topped analysts’ expectations and provided a strong fourth quarter outlook.
Citi analyst Chris Danely said investors may be focused on slowing growth in its AI business, as AMD’s data center segment saw revenue rise 22% in its third quarter.
That’s more than the 14% revenue increase recorded by the segment in the second quarter — but far below the revenue growth of more than 50% (and in some cases, 100%) seen in the five quarters before that.
AMD sells GPUs (graphics processing units, or AI chips) that are used in data center servers to train and run AI models.
But Danely lifted his price target on shares to $260 from $215, saying he expects AMD to raise its long-term revenue guidance at its analyst day next week.
The chipmaker recently inked big deals with OpenAI and Oracle.
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US services sector shows growth in October, but consumers still under pressure
The headline S&P US Services PMI rose to 54.8 in October from 54.2 in September but was lower than the 55.2 expected, according to economists tracked by Bloomberg.
The headline Purchasing Manager’s Index measures business activity in the services sector with data from over 1,300 US companies that employ the majority of American workers. A reading above 50 signals expansion in the sector, while readings below 50 signal contraction.
The latest survey noted that businesses are absorbing higher input prices to remain competitive as consumers push back on prices.
“While good news in terms of inflation, this lack of pricing power hints at weak underlying demand and lower profits,” wrote Chris Williamson, chief business economist at S&P Global Market Intelligence.
Williamson added that business expectations for the year ahead have fallen sharply due to spending caution from consumers and heightened political and economic uncertainty — partly due to tariffs.
Meanwhile, the ISM Services PMI came in at 52.4 for October, above the expected 50.8, with 11 industries reporting growth, including food services, retail, real estate, healthcare, and technology.
But ISM’s report noted that employment in the services sector continues to contract. ISM’s employment index for the services sector registered a reading of 48.2 in October, up from 47.2 in September.
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Supermicro stock falls 7%
AI server maker Supermicro (SMCI) saw its stock drop more than 7% in early trading on Wednesday after its earnings and revenue for the first quarter fell below analyst expectations.
Supermicro’s adjusted earnings per share of $0.35 were lower than the $0.41 projected by analysts, according to Bloomberg consensus estimates, but an increase from $0.07 in the year-ago period.
The company — which was embroiled in controversy last year related to allegations of accounting violations — reported revenue of $5.02 billion for the period, down from $5.94 billion during the first quarter of 2024 and less than the $6.09 billion expected by analysts.
To be sure, Supermicro’s quarterly revenue was in line with its own recently revised guidance.
Tuesday’s report marked the sixth consecutive quarter that Supermicro’s earnings and revenue have fallen short of analyst estimates, per Bloomberg data.
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Stocks steady after premarket sell-off
US stocks recovered from earlier losses in premarket trading as the ADP payrolls report showed job growth in the private sector in October.
The S&P 500 (^GSPC) and the Nasdaq Composite (^IXIC) were roughly flat at the market open as a sell-off in tech stocks eased. The Dow Jones Industrial Average (^DJI) rose 0.1%.
The market action comes as the US government shutdown enters its 36th day, making it the longest in the country’s history.
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ADP: Private payrolls rebounded in October, with employers adding 42,000 jobs
Private employers added 42,000 jobs to the US economy in October, according to ADP’s private payrolls report, rebounding from an upwardly revised loss of 29,000 jobs in September.
Forecasters were expecting the economy to add 30,000 jobs during the month, according to S&P Global Market Intelligence.
“Private employers added jobs in October for the first time since July, but hiring was modest relative to what we reported earlier this year,” said ADP chief economist Nela Richardson. “Meanwhile, pay growth has been largely flat for more than a year, indicating that shifts in supply and demand are balanced.”
Job growth was led by gains in the trade/transportation/utilities sector (+47,000) and the education/health services sector (+26,000). The biggest job losses were seen in information services (-17,000), professional/business services (-15,000), and other services.
Wages rose 4.5% year over year, unchanged from the month before.
ADP’s private payroll report is likely to get more attention than usual as the government shutdown — which officially became the longest federal shutdown in US history on Wednesday — has created a data vacuum. The Bureau of Labor Statistics’ monthly jobs report, for instance, continues to be delayed during the stoppage.
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Good morning. Here’s what’s happening today.
Economic data: MBA mortgage applications (week ended October 31); ADP employment change (October); S&P Global US services PMI (October final reading); S&P Global US composite PMI (October final reading); ISM services index (October); ISM services prices paid (October); ISM services new orders (October); ISM services employment (October)
Earnings calendar: Toyota (TM), Novo Nordisk (NVO), McDonald’s (MCD), AppLovin (APP), Qualcomm (QCOM), Arm Holdings (ARM), Robinhood (HOOD), DoorDash (DASH), Snap (SNAP), McKesson (MCK), Emerson Electric (EMR), Fortinet (FTNT), Sempra (SRE), Energy Transfer (ET), MetLife (MET), AllState (ALL), Cameco Corporation (CCJ), Fair Isaac (FICO), Humana (HUM), Targa Resources (TRGP), Fidelity (FIS), Iron Mountain (IRM), Atmos Energy (ATO), HubSpot (HUBS), Formula One Group (FWONK), Figma (FIG), Teva Pharmaceuticals (TEVA), IonQ (IONQ), Talen Energy (TLN), TKO Group (TKO), Performance Food Group (PFGC), Royal Gold (RGLD), Joby Aviation (JOBY), Duolingo (DUOL), Albemarle (ALB)
Here are some of the biggest stories you may have missed overnight and early this morning:
Trump tariffs’ big test in Supreme Court arrives
Wall Street pros to see their biggest bonus bump since 2021
Musk’s $1 trillion pay fight to dominate Tesla shareholder meet
Palantir’s epic run-up gives the market a reason to sell
McDonald’s US sales beat, but earnings miss the mark
Novo Nordisk cuts FY profit guidance as sales slow
Toyota reports profit drop as Trump’s taxes hurt Japan automakers
China ends levies on US farm goods after fentanyl duties cut
Global chip selloff erases $500B in value as fears mount
Latest stock pullback shows how stretched this market has become
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McDonald’s US sales top forecasts as it continues value push amid ‘challenging environment’
McDonald’s (MCD) stock rose modestly after the fast food chain reported better-than-expected same-store sales that topped forecasts for the second straight quarter. McDonald’s continues to lean into its value menu to win back customers in what the company calls a “challenging environment.”
Yahoo Finance’s Brooke DiPalma reports:
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Premarket trending tickers: Pinterest, SMCI and Lumentum
Pinterest (PINS) stock fell more than 17% before the bell after the image-sharing platform announced that tariff related pressures and struggling to find new avenues for growth have dampened its forecast.
SMCI (SMCI) stock fell 9% before the bell after releasing its third quarter earnings on Tuesday, with its forecast falling below Wall Street expectations.
Lumentum Holdings Inc. (LITE) stock rose 15% in premarket trading on Wednesday after reporting third quarter earnings which beat Wall Street estimates.
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Trump tariffs big test in Supreme Court kicks off today
Looking to experts for how the Supreme Court will rule on tariffs? They aren’t sure either, writes Yahoo Finance’s Ben Werschkul.
He reports:
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Novo Nordisk lowers full-year profit guidance
Novo Nordisk (NVO, NOVO-B.CO) cut its forecasts for full-year profit and sales on Wednesday, as its new CEO drives a push to regain ground lost amid fierce competition in the weight-loss drug market.
US-listed shares in the Ozempic and Wegovy maker rose almost 3% in premarket as investors digested the Danish drugmaker’s quarterly earnings release.
Reuters reported:
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Asian markets fall in response to tech sell-off
Asian markets fell in tandem with US gauges as the global market followed a tech sell-off trend. Investor appetite for sky-high AI spend appears to have hit a ceiling as fears of over-inflated AI valuations spread.
South Korea’s Kospi (^KS11) fell over 6% before pulling back to a 3% drop.
Japan’s benchmark, the Nikkei 225 (^N225) levelled off at losses of 2.8%
Hong Kong’s Hang Seng index (^HSI) slipped 0.5%.
The fall came following a day of heavy losses for major American gauges as AI tech darlings like Palantir fell despite solid earnings reports.
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Gold falters around the $4000 mark
Gold (GC=F) continues to struggle around the $4,000 mark following a record-setting run, as a strong dollar, combined with the Fed’s rate cuts, has dampened haven demand.
Bloomberg reports:
