U.S. stocks were mixed on Thursday as Wall Street digested a volatile earnings week and reacted to fresh signals from the Federal Reserve and an apparent trade truce between the U.S. and China. The Dow Jones Industrial Average rose 0.2% after a brief dip, while the S&P 500 slipped 0.5% and the Nasdaq Composite fell 0.9% as tech weakness weighed on broader sentiment.
Investors are waiting for key earnings from Apple (AAPL) and Amazon (AMZN) after the closing bell, following a volatile set of results from other “Magnificent Seven” stocks. Alphabet (GOOG) provided a bright spot with a strong quarter, but Meta (META) and Microsoft (MSFT) dragged the Nasdaq lower after investors reacted to higher spending forecasts and cautious guidance.
Market Movers:
- Meta (META) -12% – Shares plunged after the company disclosed a $16 billion one-time tax charge and outlined a surge in 2025 capital expenditures, now forecast at $70–$72 billion. Despite a revenue beat, investors were rattled by higher R&D costs and warnings of “notably larger” spending growth in 2026.
- Alphabet (GOOG) +5% – The Google parent jumped after reporting quarterly revenue of $102.3 billion, its first-ever quarter above $100 billion. Cost discipline and strong cloud performance helped drive a 35% EPS jump, reinforcing confidence in its AI strategy.
- Microsoft (MSFT) -2% – Shares slipped despite a top- and bottom-line beat as management warned of elevated AI infrastructure costs next year. The company noted its OpenAI investment reduced quarterly net income by $523 million.
- Cigna (CI) -14% – The health insurer fell sharply after warning of margin pressure in its pharmacy benefit management segment, citing reimbursement challenges in Medicare and Medicaid. Peer stocks like UnitedHealth (UNH) and CVS Health (CVS) also declined in sympathy.
- Sprouts Farmers Market (SFM) -25% – The grocery chain dove after issuing weak guidance for the holiday quarter, forecasting flat same-store sales growth and missing profit expectations for 2025.
Fed Uncertainty Tempers Optimism
The Federal Reserve’s latest comments added even more uncertainty in markets. Chair Jerome Powell restated that another rate cut in December is “not a foregone conclusion,” signaling a more cautious stance amid mixed inflation and labor data. His analogy — “When you’re driving in the fog, you slow down” — demonstrates the Fed’s reluctance to move too quickly, dampening investor bets on near-term easing.
The remarks caused a brief pullback in bond yields, while traders trimmed expectations for two cuts by early 2026. Markets are now pricing a longer plateau for rates, pressuring growth stocks and high-valuation sectors that benefited from easing speculation earlier in the month.
Trade Truce Adds Relief, but Questions Remain
Markets also absorbed news from South Korea, where Presidents Trump and Xi Jinping reached a one-year trade truce that will temporarily halt China’s planned rare earth export controls. The deal includes a halving of U.S. tariffs on fentanyl-related goods and a pledge from Beijing to resume U.S. soybean purchases.
The rare earth sector saw choppy trade following the announcement. U.S. producer MP Materials (MP) briefly dropped before rebounding to a 1% gain, while USA Rare Earth (USAR) and NioCorp (NB) swung between losses and gains as investors assessed the longer-term implications of the temporary reprieve.
Gold Shines as Investors Hedge
Gold prices extended gains, climbing 0.4% to around $4,015 per ounce, after a World Gold Council report showed record third-quarter demand driven by “fear of missing out” buying. ETF inflows and coin purchases surged as investors sought hedges against market volatility and lingering geopolitical risk. The report noted that “investors remained firmly in the driver’s seat,” highlighting how elevated valuations and policy uncertainty continue to push traders toward alternative assets.
Looking Ahead
All eyes now turn to Apple and Amazon, which will report earnings after the close and could reset sentiment for both tech and the broader market. Analysts are watching for updates on Apple’s China exposure and Amazon’s cloud margins as key indicators of consumer and enterprise demand heading into year-end. With the Fed’s next move uncertain and trade tensions only partially eased, volatility is likely to remain elevated. The coming days could determine whether markets extend their October rebound — or finally pause after a relentless rally in big tech.