October 21st Market Overview

Happy Wednesday

Stocks rose, with the Nasdaq out front. SpaceX’s earnings kept lifting chip stocks all day and pushed AT&T, Verizon and T-Mobile lower. Then a Saudi oil field was attacked this afternoon, and stocks barely moved. That tells me buyers aren’t easily spooked right now, everyone’s waiting for earnings season to start.

Let's dig in...

Today's Big Picture

1. SpaceX Lifted Chip Stocks and Hit Phone Companies 
   Nvidia added more to the Nasdaq than any other stock today, and SpaceX came in second. Other chipmakers rallied after SpaceX said its AI business grew ninefold. Phone carriers fell instead, since SpaceX plans to launch Starlink Mobile, a cellphone service, in early 2028. Musk told analysts it could eventually bring in several hundred billion dollars a year.
   

2. A SpaceX-Tesla Deal Needs Tesla Holders to Say Yes 
   Musk wants to merge SpaceX and Tesla, but he owns just under a fifth of Tesla. A deal needs backing from holders of more than half its shares. Altimeter Capital’s Brad Gerstner expects SpaceX to pay $420 to $550 a Tesla share, against about $386 this afternoon. It would be the biggest merger in history, likely valuing Tesla above $1.5 trillion.
   

3. Netflix Hit a Two-Year Low After a Soft Forecast 
   Netflix expects $13.44 billion in fourth-quarter revenue, just short of the $13.51 billion analysts wanted. It cut its 2026 ad sales target to $2.7 billion from $3 billion, since new ad tools are running late. The stock is on track for its lowest close since August 2024, about half its June 2025 record. Netflix still sees sales growing by double digits next quarter.

Market Overview

Index Performance

Stock Spotlight

AT&T $T ( ▼ 6.13% )  
beat on profit and revenue but added 379,000 phone customers, about 8,000 fewer than expected. CEO John Stankey says a Starlink rival won’t happen overnight, since nearly all traffic is where AT&T has already built.

United Airlines $UAL ( ▲ 4.03% )  
rose on record revenue of $17.9 billion, even though fuel costs pushed its profit forecast below estimates. CEO Scott Kirby says airlines must cut money-losing flights, and some carriers are “next up in the firing line.”

Roivant Sciences $ROIV ( ▲ 4.38% )  
rose after its pill Lisraya hit its main goals in two late-stage trials for an eye disease.

Big Name Updates

Berkshire Hathaway $BRK.B ( ▲ 0.54% )  
hit a record high, 17 months after Warren Buffett said he’d step down as CEO. Greg Abel, who took over in January, bought back about $4.5 billion of stock in the second quarter.

Meta $META ( ▲ 1.43% )  
was ordered to pay a $25 billion penalty in a New Mexico case over Cambridge Analytica.

Abbott $ABT ( ▼ 1.85% )  
is spinning off its nutrition business (Similac, Pedialyte), which brings in about $8.5 billion a year. Shares fell after heart and diabetes sales came in soft.

Other Notable Company News

Intuitive Surgical $ISRG ( ▼ 2.18% )  
fell after earning $3 a share on $3.05 billion in third-quarter revenue.

Zoom Communications $ZM ( ▲ 2.34% )  
rose after Oppenheimer upgraded it with a $130 price target. The bank says its AI tools are catching on faster than expected.

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Sector Watch

Bond Market

Treasury yields barely moved ahead of next week’s Fed meeting. Mortgage rates dipped for the first time in over two months, and applications still fell.

Policy Watch

Fed

Traders see about nine-in-ten odds of another rate hike in December. BlackRock’s Rick Rieder expects the hike but disagrees with it. He says higher rates are squeezing housing, car loans and credit cards while barely touching big tech’s AI spending.

Fiscal & Trade

• Citadel’s Ken Griffin called the tariff fights with U.S. allies a disaster.
  

• He also said rising Treasury yields are the bond market’s warning to Congress to fix the budget. The deficit reached $2 trillion in fiscal 2026.

International

Saudi Arabia said an Aramco oil field was attacked this afternoon, and oil rose on the news. There’s no word yet on damage, and stocks barely reacted.

• France now pays more to borrow for 10 years than at any point since 2002. Weekend riots added to worries about its budget.
  

• Carrefour, France’s biggest grocer, cut its profit targets and blamed the unrest.

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.

Tesla Earnings Tonight

Tesla $TSLA reports after the bell, and spending is the number I care most about. Analysts expect $7.9 billion in capital spending, up from $2.25 billion a year ago, as it leans into AI. That would leave Tesla burning about $4.3 billion more cash than it brings in.

Meta Earnings Tonight

Meta $META reports after the close too. Barclays thinks strong results from the big AI spenders could calm a bond market that’s nervous about AI debt. Watch whether Meta lifts its spending plans, and how much of that it plans to borrow.

SpaceX Share Unlock Thursday

Up to 1.3 billion SpaceX $SPCX shares unlock Thursday, the biggest batch yet, letting early holders sell. Past unlocks barely dented the stock. I’d watch whether it holds $150, with $172 the level that capped it in July and October.

Thanks for reading - you are now the more informed 🙂

- John

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