October 20th Market Overview

Happy Tuesday

This morning opened on the back foot and finished with most of the market green. One report about possible U.S.-Iran talks turned the mood. I’ll take a rally that doesn’t need the tech giants to show up. It cant always be AI and chip names propping up the market.

Let's dig in...

Today's Big Picture

1. An Iran Report Flipped the Market 
   Stocks opened lower, then turned on an unverified report that mediators had a plan to restart U.S.-Iran talks. Brent crude backed off a five-month high above $111 to around $109. Late in the day, about three of every four S&P 500 stocks were up, the broadest rally since June. Small caps led.
   

2. AI Stocks Bounced, AI Debt Didn’t 
   CoreWeave $CRWV hit its lowest price since May 2025 before the open, then bounced into the green. It borrowed heavily to build data centers, and insurance on that debt still trades at distress levels. Insuring Oracle $ORCL debt costs the most since at least 2021. Stock buyers have moved past last week’s AI scare, and the debt market hasn’t.
   

3. Pending Home Sales Hit a Record Low 
   Signed deals that haven’t closed yet fell to the lowest level since records began in 2001. Economists expected a small dip, and housing starts missed forecasts too. Blame mortgage rates, which have climbed from the 6s to the mid-7s since early September. Lawrence Yun, chief economist for the National Association of Realtors, thinks rates could be close to topping out.

Market Overview

Index Performance

Stock Spotlight

3M $MMM ( ▲ 5.75% )  
beat earnings estimates and raised its full-year outlook to as much as $9.15 a share. It also signed up Amazon $AMZN for server connectors that 3M says cut six months off building a data center.

General Motors $GM ( ▼ 7.07% )  
beat estimates and announced a $20 billion buyback, yet the stock went down. The middle of its new full-year outlook sat below what Wall Street wanted.

Equifax $EFX ( ▲ 11.65% )  
rallied after beating profit estimates, even though it trimmed its 2026 revenue outlook.

Northrop Grumman $NOC ( ▲ 4.68% )  
beat profit estimates by a wide margin and raised its 2026 profit forecast. Revenue came in just shy of expectations.

Big Name Updates

SpaceX $SPCX ( ▼ 0.58% )  
CEO Elon Musk pledged to give one share to every American kid next year. That’s about $10.3 billion in stock, based on the 70 million kids enrolled in the government’s Trump Accounts.

Meta $META ( ▼ 2.26% )  
has 10.9 million downloads of its new Muse AI agent since the Sept. 8 launch, per Sensor Tower. In the U.S., ChatGPT downloads fell over the past 30 days.

Eli Lilly $LLY ( ▲ 3.64% )  
was the best performer among the 10 biggest U.S. stocks and led health care to a record.

Boeing $BA ( ▼ 0.66% )  
won FAA approval for the 737 Max 10 after years of delays.

Other Notable Company News

RTX $RTX ( ▲ 0.29% )  
beat estimates and raised its 2026 profit forecast to a range of $7.65 to $7.75 a share.

GE Aerospace $GE ( ▼ 3.6% )  
fell despite a beat and raise, as free cash flow missed and supply snags slowed deliveries.

Hasbro $HAS ( ▲ 11.19% )  
beat estimates and raised its full-year revenue growth outlook.

BlackRock $BLK ( ▲ 0.17% )  
got upgraded to buy at TD Cowen, which raised its price target to $1,405.

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Sector Watch

Bond Market

The 10-year yield eased to about 5.12 as oil cooled off. A new ETF built around AI infrastructure bonds made its debut today, and hardly anyone showed up.

Policy Watch

Fiscal & Trade

• Trump announced an $8 billion “Harvest Fuel Relief Program” to help farmers pay for diesel, two weeks before the midterms.

• He’s also facing a new lawsuit over his tariffs on Canada.

International

Iran’s first vice president said his country has “no choice” but to assert control over the Strait of Hormuz. Houthi rebels also claimed new strikes on Saudi oil sites. A U.S. official said Trump has no plans to attack Iran before the midterms.

• France is under curfews after weekend riots, and the gap between French and German bond yields is widening again.
  

• Trump waived some Russia sanctions Friday so countries like India can buy Russian energy. The prospect of more Russian oil is keeping a lid on prices.

What to Watch

The AI company quietly automating every Walmart distribution center. 
23 billion in orders on the book.

It's just one of seven names in this free MarketBeat report.

SpaceX Earnings Tonight

SpaceX $SPCX reports after the bell, its second earnings report since going public in June. Capital spending hit $18.4 billion last quarter, up from $2.8 billion a year earlier. I want to see how fast the AI data-center business is growing to cover that bill.

Netflix Earnings Tonight

Netflix $NFLX also reports after the close, with Wall Street expecting 82 cents a share on $12.87 billion in revenue. This week it ousted two creative executives and cut 1,000 jobs. Listen for how it plans to get U.S. viewers watching more.

Thanks for reading - you are now the more informed 🙂

- John

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