November 4th Market Overview

Happy Tuesday

Valuation day of reckoning? Palantir crushed earnings and fell anyway. Goldman and Morgan Stanley CEOs both said they see a correction coming. The consumer might be cracking and they aren’t buying pizzas right now.

I think we just hit the point where even perfect quarters aren't enough if you're trading at 200x. Worth noting when the people running Wall Street start hedging publicly. I’m not sound the alarms but my hand is on the handle personally.

We need to end the govt shutdown and continue to solidify trade agreements to get a Santa rally going or it could be a red Christmas.

Let's dig in...

Today's Big Picture

Wall Street CEOs Warn of Pullback

Goldman's David Solomon and Morgan Stanley's Ted Pick both see a correction coming in the next 12 to 24 months. Solomon says ten to twenty percent. The S&P 500 is trading near its most expensive level since 2000. These aren't perma-bears. These are the guys running the machine.

Palantir Beats and Still Drops

Palantir $PLTR fell even after crushing estimates. Revenue hit $1.18 billion with government sales up more than fifty percent. The stock trades at 200 times earnings. CEO Alex Karp called Michael Burry "bats shit crazy" for shorting Palantir and Nvidia $NVDA. Burry has over $900 million in puts on Palantir and $200 million on Nvidia.

Consumer Spending Cracks Spreading

Papa John's $PZZA collapsed after Apollo Global walked away from its takeover. The reason: weak consumer spending. Norwegian Cruise Line $NCLH missed revenue badly. Bernstein calls the holiday season "bleak." Bank of America says delayed SNAP benefits will hit November spending. This isn't one sector anymore.

Market Overview

Index Performance

Stock Spotlight

Sarepta Therapeutics $SRPT ( ▼ 33.6% ) 
tumbled after its late-stage study for Duchenne muscular dystrophy therapies missed the main goal. The stock lost more than a third of its value.

Berkshire Hathaway $BRK.A ( ▲ 2.66% ) 
climbed as investors sought safety during the selloff. Warren Buffett's conglomerate reported operating profit jumped more than a third, driven by a surge in insurance underwriting income.

Norwegian Cruise Line $NCLH ( ▼ 15.4% ) 
dropped after third-quarter revenue of $2.94 billion missed the $3.02 billion that analysts expected. The stock was on pace for its worst day since April.

Spotify $SPOT ( ▼ 2.25% ) 
beat on earnings and revenue. Monthly active users hit 713 million, above estimates. Premium subscribers reached 281 million. Shares still fell.

Uber $UBER ( ▼ 4.87% ) 
reported gross bookings rose to $49.74 billion and trips increased to 3.5 billion. The stock dropped despite the beat.

Big Name Updates

Tesla $TSLA ( ▼ 4.89% ) 
fell after Norway's $2.1 trillion sovereign wealth fund said it will vote against Elon Musk's pay package. The fund cited the award's size and lack of key person risk mitigation. Shareholder vote results come Thursday.

Nvidia $NVDA ( ▼ 3.85% ) 
CEO Jensen Huang said AI computing demand has climbed meaningfully over the past six months. He confirmed involvement in xAI's financing. Shares retreated with the broader tech selloff.

Apple $AAPL ( ▲ 0.38% ) 
iPhone 17 sales are exceeding expectations in China according to DigiTimes.

Yum Brands $YUM ( ▲ 7.22% ) 
reported earnings growth fueled by Taco Bell. The company announced it's reviewing strategic options for Pizza Hut, including a possible sale.

Starbucks $SBUX ( ▼ 1.54% ) 
formed a joint venture with Boyu Capital to operate its China business. Boyu pays roughly $4 billion for up to sixty percent while Starbucks retains forty percent.

Other Notable Company News

Cognizant $CTSH ( ▲ 0.11% ) 
signed a deal to roll out Anthropic's Claude AI to all 350,000 employees. Cognizant becomes one of Anthropic's three largest customers and will resell Claude to business clients.

Walmart $WMT ( ▲ 0.67% ) 
CEO Doug McMillon said the company is going "on offense" with AI. Every job at the retailer will change in some way as AI transforms operations for 2.1 million employees.

Molson Coors $TAP ( ▲ 0.9% ) 
plans to lean more on affordable brands like Miller High Life and Keystone Light. New CEO Rahul Goyal said low-income and Hispanic consumers have pulled back particularly hard.

Kimberly-Clark $KMB ( ▼ 2.02% ) 
will acquire Kenvue $KVUE for about $21 per share in a $40 billion deal. Evercore downgraded Kimberly-Clark immediately over Tylenol liability concerns.

DraftKings $DKNG ( ▼ 6.4% ) 
was downgraded to neutral at BofA. iGaming share has declined from twenty-seven percent to twenty-three percent over the past two years as FanDuel takes share.

Sector Watch

Bond Market

Money moved to safety, pushing Treasury yields lower. The dollar hit its highest level since August. The 10-year auction went fine despite the shutdown.

Policy Watch

Government Shutdown

Day 35. Tied for longest shutdown in U.S. history. One Republican senator told CNBC he's confident the government reopens this week. We'll see.

SNAP Benefits Crisis

• A federal court forced the administration to pay half of SNAP benefits using emergency funds

• payments are substantially delayed

• BofA says this hits November spending

• Low-income consumers getting squeezed hard

Treasury & Trade

Treasury Secretary Bessent defended using emergency powers for China tariffs. He called it a justified response to critical trade issues. Bessent said it would be "very unusual" for the Supreme Court to overrule tariffs, but they have backup plans.

Federal Reserve

Fed Governor Lisa Cook described December's meeting as "live." Mary Daly and Austan Goolsbee said they're weighing a slowing labor market against high inflation. Bitcoin fell to its lowest level since June on the uncertainty.

International

• Nippon Steel says its U.S. Steel $X investments will more than triple profits

• Nvidia and Deutsche Telekom announced a €1 billion German data center with 10,000 GPUs launching Q1 2026

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What to Watch

Musk's Pay Vote

Tesla $TSLA reveals shareholder vote results on Thursday. The package would give Musk an additional twelve percent stake if he grows Tesla to an $8.5 trillion valuation. Norway's wealth fund already voted no. This will be interesting.

AMD Earnings After the Close

Advanced Micro Devices $AMD reports after the bell. The stock has more than doubled this year but trades at stretched valuations like the rest of the AI trade. Investors want proof that capital expenditure translates to profit growth.

The Consumer

I'm watching for any real-world data on consumer spending. The delay in SNAP benefits is a real concern for lower-income households and the retailers that depend on them. Bernstein is already predicting a "bleak" holiday shopping season.

Thanks for reading 🙂

- John

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