United States
Wall Street endured another bout of volatility overnight as fresh evidence of a cooling labour market rattled investors. The S&P 500 fell 1.1%, the Nasdaq 100 tumbled 1.9%, and the Dow Jones shed 0.8%, marking the second sell-off in three sessions. Job cut data showed the largest number of October layoffs in more than two decades, fuelling concerns that labour weakness may prompt further Federal Reserve rate cuts.
High-valuation tech names were hit particularly hard, with Nvidia and Tesla leading losses as the AI-focused index slumped nearly 3%. The tech-heavy decline erased recent gains driven by optimism around artificial intelligence and rate-cut expectations. Traders moved into bonds, pushing the 10-year Treasury yield down seven basis points to 4.09%, its sharpest fall in a month.
Federal Reserve officials gave mixed messages. Cleveland Fed President Beth Hammack warned inflation remains a greater risk than employment softness, while Chicago’s Austan Goolsbee cited discomfort with limited inflation data during the government shutdown. Fed Governor Michael Barr reaffirmed that the central bank’s work on inflation isn’t finished.
In corporate updates, Airbnb and Expedia both delivered upbeat holiday-quarter forecasts, while Qualcomm issued a strong earnings outlook that failed to impress investors. DoorDash plunged on plans for higher investment spending next year, Take-Two Interactive delayed the launch of Grand Theft Auto VI to November 2026, and Boeing secured a legal reprieve related to its 737 Max case alongside new jet sales in Central Asia. Microsoft, meanwhile, advanced its pursuit of “superintelligence” in AI research.
Europe
European equities extended losses after comments from Fed policymakers dampened optimism for rate cuts. The Stoxx 600 fell 0.7%, with industrials leading declines after Legrand dropped more than 12% as the data-centre boom that had driven recent profits showed signs of cooling.
Schneider Electric and Siemens also weakened, while Deutsche Post surged 8.6% on stronger earnings from tight cost control. Gains in IMI and Adecco helped limit broader losses. Lanxess plunged 12% after warning that earnings would hit the low end of guidance, while IMCD sank 7% on margin pressure.
The banking sector outperformed, rising for a fifth consecutive session, as BBVA, NatWest, and Lloyds all posted gains of over 1%. In contrast, financials were weighed down by a 4% fall in Deutsche Boerse after EU regulators opened an investigation into a suspected derivatives cartel.
Healthcare stocks offered some relief: AstraZeneca gained 3% after a strong quarterly beat, and Novo Nordisk rose 2% amid progress in its bid for obesity-drug developer Metsera. Novonesis rallied 7% after lifting its full-year outlook, while Smith & Nephew sank nearly 11% following disappointing sales and the absence of revised guidance.
Among consumer names, Diageo dropped 6.5% after cutting its outlook on weak demand in China and the US, while Zalando advanced 6.6% on improved top-line growth and a new share buyback. Energy stocks were mixed as Brent crude steadied around US$63.40 per barrel, with Shell and TotalEnergies slightly weaker, offset by gains in Repsol and Neste.
Australia
The ASX 200 snapped a multi-day losing streak on Thursday, closing 0.3% higher at 8,827.9, supported by a resurgence in gold miners and broader strength in materials. Six of the eleven sectors finished in positive territory as investors rotated into defensive and resource names following a volatile session on Wall Street.
Gold miners led the charge as bullion traded near US$3,980 an ounce, extending its rally from Wednesday’s 1.2% rise. Newmont climbed 2.8% to A$125.78, Northern Star added 2.8% to A$24.47, and Evolution Mining gained over 3%. Major miners also advanced despite a sixth straight daily fall in iron ore prices — BHP rose 1.6%, Rio Tinto 2.3%, and Fortescue Metals 2.1%.
Banks were mixed after National Australia Bank missed full-year earnings expectations with A$7.09 billion in cash profit, dragging its shares 3.3% lower to A$43.10. Westpac eased 1.2%, while Commonwealth Bank bucked the trend, gaining 1.3% to A$178.57.
Outside the majors, Light & Wonder jumped 8.2% after reporting a 78% increase in quarterly net income, driven by record iGaming revenue. Amcor added 5% after an earnings beat and reaffirmed full-year guidance, while Domino’s Pizza Enterprises climbed 4.7% following new debt facilities totalling A$1.05 billion. On the downside, James Hardie plunged 12.7% after its removal from the MSCI Australia Index, while DroneShield fell nearly 12% amid weakness across defence technology stocks.
Bond yields rose, with the Australian 10-year climbing 5.3 basis points to 4.37%, while the 3-year yield gained 3.1 bps to 3.66%.
Commodities and currencies
Gold edged higher to US$3,986.81 per ounce, extending its weekly advance as investors sought safety amid rising volatility. Brent crude slipped 0.2% to US$63.41 per barrel following the largest build-up in US inventories since July. Iron ore continued to decline, settling near US$102.65 per tonne, marking its longest losing run since August as Chinese steel demand waned.
In currency markets, the Australian dollar weakened 0.3% to US$0.6485, while the New Zealand dollar fell 0.4% to US$0.5638. The euro strengthened 0.5% to US$1.1545 amid softer US data, and the US 10-year Treasury yield fell to 4.09%, reflecting growing expectations for a December Fed rate cut.
Economic Calendar
US:
- Change in Nonfarm Payrolls Oct 00:30
- Unemployment Rate Oct 00:30
This article was written by James Woods, Rivkin Securities Pty Ltd. Enquiries can be made via [email protected] or by phoning +612 8302 3632.
