Apple and Palantir have just delivered the kind of numbers most companies only dream about, and the market has answered with a shrug and a sell order. Apple posted record quarterly revenue under its new chief executive and Palantir nearly doubled its sales, yet both are lower before the open. On the day America votes in the midterms, that is the clearest sign yet that good news is no longer enough for the biggest winners of the AI era.
The wider picture is mixed rather than gloomy. Chipmakers are clawing back a little of Monday’s losses ahead of AMD’s results tonight, but oil has turned higher again after Iran said three tankers hit mines in the Strait of Hormuz, and bond yields on both sides of the Atlantic are climbing. Traders go into the cash open with plenty to think about and very little conviction.
The Situation Right Now
S&P 500 futures are down about 0.15% near 7,564, close to Monday’s cash close of 7,541.40, when the index fell 0.5%. Nasdaq 100 futures are up around 0.3%, helped by the chip rebound, while Dow futures are down about 0.8%, with Apple’s slide weighing on the price-weighted index. The Nasdaq Composite lost 1.1% on Monday as the memory chip sell-off rolled on, while the Dow managed a small gain.
Europe is in the red. The FTSE 100 is down about 0.6% near 10,697, Germany’s DAX is off around 0.6% and the Stoxx 600 is down roughly 0.4%. Asia was rougher still for technology: South Korea’s KOSPI and Taiwan’s main index both closed down about 3.6% as the chip selling spread overnight, although India’s Nifty 50 rose 1.6%. The VIX, Wall Street’s fear gauge, is up slightly at about 21.6.
What Changed Since This Morning?
Three things have shifted since breakfast. Oil has firmed, with Brent up from around $105.30 to about $106.50 after Iran’s Revolutionary Guard navy said three tankers struck mines near the southern shore of the strait. Independent confirmation is limited, but the headline was enough to unwind some of Monday’s huge drop, when Brent fell more than 7%.
Bonds have weakened. The UK 10-year gilt yield has climbed from about 5.20% this morning to roughly 5.27%, giving back much of Monday’s rally, and the US 10-year Treasury yield has edged up to about 4.94%. Dow futures have also slipped further, from a fall of about 0.4% at breakfast to around 0.8% now, as Apple’s pre-market losses deepened.
Gold and silver have kept falling. Gold futures are down about 1.4% near $3,916 an ounce and silver is down more than 3.5%, just above $49, even as the World Gold Council reported record central bank buying in the third quarter.
The Biggest US Market Story: The Bar Has Moved
Apple’s first results under John Ternus were, on paper, excellent. Revenue rose about 12% to roughly $114.5 billion, ahead of forecasts, with record iPhone sales and an all-time high for services. India set a quarterly record. The worries sit underneath: sales in Greater China grew but still came in below expectations, and supply shortages for the new iPhone Duo have no clear end date. Apple shares are down almost 4% in pre-market trading near $325.
Palantir’s story is even starker. Third-quarter revenue rose about 96% to $2.31 billion, US commercial sales overtook government revenue for the first time, and the company raised its full-year outlook to $8.53 billion. The shares are down about 8% before the open near $164, after already falling 3% on Monday.
The common thread is expectations. When a stock is priced for perfection, a beat is the minimum, not a reason to celebrate, and investors look for any crack in the story. For Apple it is China and supply. For Palantir it is simply how much growth is already in the price after a huge run. After a week in which the Nasdaq 100 shed around a trillion dollars on doubts about AI spending, investors are quicker to take profits than to give the benefit of the doubt.
That matters for the wider market because these are exactly the companies that have carried the indices. If record results cannot lift them, the burden falls on the rest of the market, and on tonight’s results from AMD, to show the AI trade still has fuel.
Stocks Moving Before The Open
The chipmakers hit hardest on Monday are steadier. Micron is up about 1.8% and SanDisk about 2.3% in pre-market trading after falls of 5.8% and 6.6% respectively. Intel is up around 1.9% after an 8.8% drop, Nvidia about 1.3% and Broadcom around 1.3%. Western Digital and Seagate, which both fell almost 8% on Monday, are up between 1% and 2%. AMD is up about 1.8% ahead of its results after the close, having lost 7.5% on Monday.
Oil majors are edging higher with crude, with Exxon Mobil and Chevron each up a little under 1% after falling 3% to 4% on Monday. Airlines are giving back some of Monday’s gains, with Delta down about 1% after a 4% rise. Tesla is slightly lower, while Meta is a touch firmer.
FX & Dollar
Currency markets are quiet. The dollar index is barely changed near 101.84, the euro is around $1.1181 and the pound is steady near $1.3411. The dollar is near ¥158.23, keeping the yen close to the levels where Japanese officials have previously warned about excessive moves. With the Bank of England expected to raise rates on Thursday, the pound has held up well against the euro, which is near 83.3p.
Bonds
Yields are rising. The US 10-year Treasury yield is about 4.94% and the two-year, which tracks expectations for Federal Reserve policy, is near 4.62%. The 30-year yield is above 5.3%. Markets still lean towards another Fed rate rise in December, so firmer oil is unwelcome.
Gilts are under more pressure. The UK 10-year yield is up about seven basis points to around 5.27% and the two-year is near 4.86%, while German yields are up about four basis points near 3.34%. Australia’s central bank raised rates to 4.85% overnight, its fifth increase this year, a reminder that inflation fighting is still the global theme, and Thursday’s Bank of England decision is next.
Commodities
Brent is near $106.50 and West Texas Intermediate, the US benchmark, around $98.50, both up roughly 2% after Monday’s slump. Iran’s parliament speaker said Tehran had given a strong response to Washington and the next move is theirs, while a senior Iranian official said no deal is close unless the Strait of Hormuz reopens first. Oil is swinging between hope from the talks and fear from the water.
Gold futures are near $3,916 and silver just above $49, both lower, and copper is down about 3%, a weak signal for industrial demand. Bitcoin is up about 0.5% near $77,000.
Today’s Remaining Catalysts
The US cash market opens at 14:30 UK time. JOLTS job openings data, a measure of how many vacancies US employers have, is due at 15:00 UK, and it matters more than usual with Friday’s jobs report ahead. AMD reports after the US close, the biggest single test for the chip sector this week.
The midterm elections dominate the evening. The first polls close around 23:00 to midnight UK time, and the results will shape how much of the President’s agenda can pass through Congress. Wednesday brings ADP private payrolls, Thursday the Bank of England, and Friday the October jobs report.
Levels Traders Are Watching
For the S&P 500, Monday’s close of 7,541 is the first reference, with 7,500 the round number below. On the Nasdaq Composite, Monday’s close near 25,164 matters. For Apple, Monday’s close near $338 and the pre-market area near $325 frame the reaction, and for Palantir it is $178 against roughly $164. In oil, $105 and $110 for Brent are the markers. In bonds, 5% on the US 10-year and 5.25% on the UK 10-year stand out, and in currencies, $1.34 for the pound and ¥158 for the dollar against the yen. These are reference levels, not targets.
Where This Leaves Us
The bias going into the open is cautious. The evidence is that the market is punishing even record results from its favourite growth names, oil has turned higher on fresh Gulf headlines and yields are rising, all on a day when the election adds an extra layer of uncertainty. The modest chip rebound is the one bright spot, and it is fragile until AMD reports.
The opportunity for patient traders is to watch how Apple and Palantir trade in the first hour rather than react to pre-market moves, since big gaps on results days often see sharp swings once the cash session starts. The risk is that rising yields and firmer oil feed fears of a December Fed hike, pulling the wider market lower. The view would turn more positive if the chip rebound holds through the session and Treasury yields ease back below 4.9%, and more negative if Brent pushes back above $110.
Markets to watch are Apple, Palantir, the Nasdaq 100, Brent crude, the US 10-year yield and the UK 10-year gilt. For beginners, the lesson is that share prices move on what happens against expectations, not on whether a number is good or bad on its own, and that is why a record quarter can still see a stock fall. If you want a clear view of how your own trading habits hold up on days like this, the Samuel & Co Trading Assessment is a sensible next step.
