Preview of US Stock Market | The three major stock index futures rose together, and Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR (TSM.US) Q3 earnings exceeded expectations.

1. Before the US stock market on Thursday, the futures of the three major US stock indexes all rose. As of the time of publication, the Dow Jones futures rose by 0.23%, the S&P 500 Index futures rose by 0.35%, and the Nasdaq futures rose by 0.48%. 2. As of the time of publication, the Germany DAX index fell by 0.14%, the UK FTSE 100 index fell by 0.24%, the France CAC40 index rose by 0.92%, and the European Stoxx 50 index rose by 0.40%. 3. As of the time of publication, WTI crude oil rose by 0.50% to $58.56 per barrel. Brent crude oil rose by 0.71% to $62.35 per barrel. Market News "Few Monks, Much Porridge" Holiday Hiring: American Job Seekers Flocking to Temporary Positions for the Winter. According to research from the recruiting platform Indeed, many job seekers are turning to short-term holiday jobs as they struggle to find full-time work. Indeed data shows that as of the end of September, seasonal job searches have increased by 27% compared to the same period last year, and by a staggering 50% compared to 2023. While the demand from job seekers has significantly increased, the number of seasonal positions posted by employers has only increased by 2.7%, meaning that even temporary holiday positions are hard to come by. "The current state of the seasonal hiring market is a microcosm of the entire job market," said Indeed Senior Economist Cory Stahle in an interview. Stahle also mentioned that another sign of pressure on the job market is the increasing number of people working multiple jobs. Traders Bet Big on Fed's "Unconventional" 50 Basis Point Rate Cut, SOFR Option Open Interest Surges. Traders are heavily betting that the Federal Reserve will implement an unusually large interest rate cut before the end of the year. They believe that the Fed's policy may be more aggressive than what other market observers currently expect. Recent trading activity in options linked to the Secured Overnight Financing Rate (SOFR) shows that the market is accumulating bets that the Fed may cut rates by 50 basis points later this month or at the December meeting. This exceeds the two 25 basis point rate cuts currently priced in the interest rate swap market. Although the weeks-long government shutdown in the United States has delayed the release of employment data and other key economic indicators, once the shutdown ends, a large amount of information reflecting the latest economic conditions will be released. Record Performance Masks Concerns! Wall Street Executives Sound the Alarm on AI Bubble Risk. Major U.S. banks have reported record quarterly earnings - trading activity and receivables have hit new highs, driven in part by the artificial intelligence (AI) craze. However, several Wall Street executives have warned that the AI industry may be entering a period of excessive enthusiasm. As the earnings season kicks off this week, several bank executives have emphasized how they are using AI technology in their internal operations. From Bank of America Corp's virtual financial assistant "Erica" to JPMorgan's use of AI to further cut costs, executives have highlighted how they are incorporating AI. While they generally see the potential of AI positively, many have also expressed caution. This includes Citigroup's CFO Mason. Mason said in a conference call on Tuesday, "Looking at current stock valuations and price-to-earnings levels, it has to be acknowledged that some sectors clearly have bubbles and overvalued." Gold Bull Logic Reinforced! Government Shutdown Weakens Growth Narrative, U.S. Economy Could Lose $15 Billion per Week. A senior official at the U.S. Treasury Department said on Wednesday night that the ongoing federal government shutdown could cause the U.S. economy to lose up to $15 billion in economic output per week. This corrects an earlier erroneous statement by U.S. Treasury Secretary Scott Bezt, who previously stated that the losses were as high as $15 billion per day. However, Bezt used this incorrect estimate in two public appearances earlier on Wednesday, while urging Democrats to "be heroes" and stand with Republicans to end the shutdown. For gold prices, which have surged over 60% this year, outperforming the MSCI global stock market benchmark index and hitting multiple historical highs, this correction is a significant positive catalyst. Individual Stock News Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR (TSM.US) Adds Fuel to the "AI Faith"! Raises 2025 Guidance After Q3 Earnings Beat Expectations. Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR has raised its revenue growth forecast for 2025 to the mid-30% range, showing strong confidence in demand for AI components such as chips from NVIDIA Corporation. The financial report shows that Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR's revenue in the third quarter was $33.1 billion, a year-on-year increase of 40.8%, far exceeding market expectations. Earnings per share were $2.92, higher than the expected $2.60. With third-quarter profits surpassing expectations and jumping 39% to NT$452.3 billion (approximately $14.8 billion), Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR has also raised the lower end of its capital expenditure target for the year. The company has earmarked at least $40 billion for capacity expansion and upgrades in 2025, higher than the previous lower limit of $38 billion. In the third quarter, 23% of the company's revenue came from 3-nanometer chips, 37% from 5-nanometer chips, and 14% from 7-nanometer chips. Advanced technology accounted for 74% of the company's total revenue. Charles Schwab Corp (SCHW.US) Net New Assets Reach $134.4 Billion, Beating Market Expectations. Charles Schwab Corp's net new assets in the third quarter reached $134.4 billion, a significant 48% increase year-on-year, exceeding analysts' previous forecast of $130.2 billion. Daily trading revenue increased by 30% to $7.42 trillion, surpassing the expected $7.25 trillion. The number of new brokerage accounts opened has exceeded one million for the fourth consecutive quarter, maintaining organic growth momentum. CEO Rick Wosst emphasized that the uptake in wealth management solutions and a favorable macroeconomic environment have driven revenue and earnings per share to new highs. Additionally, the company's stock buyback program is progressing steadily, with 28.9 million shares repurchased in the third quarter at a cost of $2.7 billion, plus support from a $20 billion buyback authorization. Nestle (NSRGY.US) Exceeds Sales Expectations in Q3 and Plans Global Layoffs of 16,000 People Over the Next Two Years. Nestle announced better-than-expected sales growth in the third quarter, driven mainly by revenue growth in its confectionery and coffee products due to price increases. Internal growth (RIG), a measure of sales volume, rose by 1.5% in the third quarter, far exceeding analysts' expected growth of 0.3%. Nestle stated that organic sales (excluding currency changes and acquisitions) grew by 4.3% in the third quarter, higher than analysts' expected 3.7% growth. The company has maintained its outlook for 2025, emphasizing that organic sales growth should improve compared to 2024, and the underlying operating profit margin is expected to reach or exceed 16%. This is the first time the global packaged food company has reported sales since CEO Philipp Navratile took over. Strong Demand from High-End Passengers! United Airlines (UAL.US) Reports Q3 Earnings Exceeding Expectations, Expects Q4 Revenue to Reach New Highs. United Airlines reported better-than-expected earnings in the third quarter. The airline expects profits to grow by the end of the year, driven by loyal customers and demand for its premium seats. The financial report shows that United Airlines' third-quarter revenue increased by 2.6% year-on-year to $15.23 billion, slightly lower than the market's expected $15.28 billion. Adjusted earnings per share were $2.78, better than the expected $2.66. United Airlines and competitor Delta Air Lines, Inc. have both been actively promoting premium products in recent years, trying to differentiate themselves from budget airlines and capitalize on the resurgence in demand for luxury travel experiences. Expensive AI Chips Squeeze Profit Margins, Hewlett Packard Enterprise Co. (HPE.US) Falls Short of Profit and Cash Flow Guidance for the New Fiscal Year. Hewlett Packard Enterprise Co. has forecasted lower profits and cash flow for the next fiscal year than analysts expected, reflecting profit margin pressure in the era of artificial intelligence. Hewlett Packard Enterprise Co. expects adjusted earnings for the fiscal year ending October 2026 to be between $2.20 and $2.40 per share. The company said in a statement on Wednesday that its free cash flow will be between $1.5 billion and $2 billion. Analysts' average profit forecast is $2.41 per share, with free cash flow of $2.41 billion. As one of the largest computer equipment manufacturers, Hewlett Packard Enterprise Co. is positioning its network business as a key pillar of future expansion. The company recently acquired Juniper Networks, Inc. for approximately $13 billion. Walmart Inc. (WMT.US) Rides the AI Wave to "Soar" Again! Could Join the Trillion-Dollar Market Value Club. As Walmart Inc. announced a partnership with OpenAI to push the stock price to a record high, Mizuho Securities analyst David Bellinger said the company could join the "trillion-dollar market value elite club." Walmart Inc. is the latest company to announce a partnership with OpenAI. Walmart Inc. said that customers will be able to shop and purchase items directly through the ChatGPT platform using the "instant checkout" feature. Although this service does not currently cover fresh food, users can still purchase packaged foods, clothing, and other items from Walmart Inc. and its Sam's Club stores. Additionally, customers can engage in conversational-style interactions with ChatGPT on the Walmart Inc. main site and Sam's Club site through the search bar. Important Economic Data and Events Preview 8:30 PM Beijing Time: U.S. Initial Jobless Claims (in thousands) for the week ending October 11, U.S. Philadelphia Fed Manufacturing Index for October, U.S. Producer Price Index (PPI) YoY for September, U.S. Retail Sales MoM for September. 12:00 AM the following day Beijing Time: U.S. EIA Crude Oil Inventories Change (in thousands of barrels) for the week ending October 10. 9:00 PM Beijing Time: Fed Governor Waller speech, Fed Governor Bostic speech on "stablecoins," Fed Governor Mester speech at the 2025 International Financial Association Annual Meeting. 10:00 PM Beijing Time: Fed Governor Bowman online speech at the 2025 Fed Stress Testing Conference. 4:15 AM the following day Beijing Time: Fed Governor Mester speech at the Semaforum 2025 Fall World Economic Summit. 6:00 AM the following day Beijing Time: FOMC voting member and Minneapolis Fed President Kashkari speech. Earnings Preview Friday morning: Interactive Brokers Group, Inc. Class A (IBKR.US) Friday before the market opens: American Express Company (AXP.US), SLB (SLB.US)