Market Volatility Soars Ahead Of Elections, Tech Earnings Mixed, Strikes And Hurricanes Knock Employment Down: This Week In The Markets

The U.S. stock market experienced a setback at the end of October, breaking a five-month winning streak as election uncertainties and mixed tech earnings dampened risk sentiment.

A key measure of market turbulence, the CBOE Volatility Index, or VIX, surged by 34% last month, marking the third-largest increase for an October in an election year.

Tech giants' earnings were underwhelming, except for Alphabet Inc. GOOGL and Amazon.com Inc. AMZN. None of the other “Magnificent Seven” companies posted positive weekly performance. As a result, the Roundhill Magnificent Seven ETF MAGS fell nearly 2% for the week. This marks the worst weekly performance in two months.

Among mega-cap companies, the top performers for the week were Charter Communications Inc. CHTR and Booking Holdings Inc. BKNG, both rising approximately 9%. Booking also marked the strongest weekly gains since August 2022.

The main laggards were Advanced Micro Devices Inc. AMD and Eli Lilly and Company LLY, down 9% and 8%, respectively, for the week.

On the macroeconomic front, the U.S. economy saw a surprising slowdown in job growth in October, with nonfarm payrolls increasing by just 12,000—nearly a four-year low and well below the expected 113,000.

Factors such as hurricanes and strikes likely contributed to the hiring slowdown, while unemployment held relatively steady, indicating no significant rise in layoffs.

The labor market report has strengthened expectations for Federal Reserve rate cuts. Markets are fully pricing in a 25-basis-point cut at Thursday's meeting and assigning an 85% probability to a similar cut at the Fed’s final meeting of the year in of December.

State Betting Odds

As the 2024 U.S. presidential election approaches, state-by-state betting odds reveal a tight race between Donald Trump and Kamala Harris, with key battleground states like Pennsylvania, Michigan, and Arizona showing narrow margins, making them pivotal in the final outcome.

Gold ETF Surge

The SPDR Gold Trust GLD saw $1.8 billion in inflows during October, its highest in over two years. Rising investment demand continues pushing gold toward record highs as investors turn to this safe-haven asset at a time of political upheaval and fiscal uncertainty.

Ford Halts F-150 Lightning Production

Ford Motor Co. F is pausing F-150 Lightning production from Nov. 18 to Jan. 6, responding to Tesla Inc. TSLA's Cybertruck sales surge. The move aims to recalibrate production with demand and improve profitability for the Michigan-based automaker.

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