Preview of US Stock Market | All three stock index futures fell together, most tech stocks weakened in pre-market trading, and JP Morgan expects the stock market plunge to be near its end.

Pre-market Market Moves 1. On Thursday, October 22, U.S. stock index futures fell across the board in pre-market trading. As of press time, Dow futures were down 0.57%, S&P 500 futures were down 0.94%, and Nasdaq futures were down 1.60%. 2. As of press time, Germany's DAX index was down 0.71%, France's CAC 40 index was down 0.29%, the UK's FTSE 100 index was down 1.11%, and the Euro Stoxx 50 index was down 1.37%. 3. As of press time, WTI crude oil was up 2.34% at $99.42 per barrel. Brent crude oil was up 2.85% at $111.92 per barrel. Market News Trump denies negotiations with Iran, says situation will be resolved "soon." Trump said the United States holds a "very favorable" position on Iran "militarily and economically"; he described the current situation as "a small conflict with Iran." When asked by reporters whether he had given up negotiating with Iran, Trump replied: "No, I don't think we are currently negotiating. In any case, there will always be an outcome in the end, and it will be clear soon." He added: "Most people seem to think this will wait until after the election we'll see." French 10-year government bond yield surpasses U.S. Treasuries for the first time in 13 years. The French 10-year government bond yield rose 8 basis points intraday, surpassing the U.S. Treasury yield for the first time since 2013, reflecting growing investor concerns over France's continued fiscal deterioration and mounting debt burden. On Thursday, the U.S. 10-year Treasury yield stood at 5.08%. Increased stock market volatility prompted investors to buy back U.S. Treasuries, pushing U.S. Treasury yields lower. Attacks surge after severe PHP vulnerability exposed, Cloudflare (NET.US) detects millions of attempts. Cloudflare CEO Matthew Prince posted that after a severe vulnerability was disclosed in the widely used programming language PHP, the company detected millions of attempts to exploit it. Prince said: "In the 10 hours before the vulnerability was publicly disclosed, we detected thousands of exploitation attempts across our network. Within 45 minutes of the disclosure, that number jumped to tens of thousands; within two hours it reached hundreds of thousands, and now it has reached millions." On Wednesday, after the PHP vulnerability was disclosed, website operators around the world rushed to take emergency measures to protect their systems, leaving some government websites in Europe and elsewhere offline. World's largest sovereign wealth fund loses $30 billion amid bond market turmoil. Norway's sovereign wealth fund, the world's largest, said Thursday that its portfolio lost $30 billion in the third quarter as rising interest rates weighed on bond holdings' returns. The fund manages $2.3 trillion in assets. Its fixed-income investments returned -3.5%. Fund management said this was one of the main reasons for the overall performance decline. JPMorgan: The stock market plunge may be nearing its end. JPMorgan global market strategist Nikolaos Panigirtzoglou and his team believe that the recent decline in the semiconductor sector indicates that most long positions have been closed out, including those of momentum investors. Although short-term headwinds remain, the above position adjustments may have limited the room for further market declines. The JPMorgan team also discussed another issue that has recently worried the market: financing risks for neocloud companies. JPMorgan believes that financing does pose a problem to some extent, but given extremely strong demand for computing resources, the companies involved may be able to pass on the impact of higher financing costs to end customers. Even if financing becomes unfeasible, he does not believe the timing mismatch between capital expenditure and revenue will disrupt the entire industry's growth cycle. Anthropic launches all-weather AI agent Claude Duet. Anthropic announced Wednesday the launch of a new application called Claude Duet, positioning it as a "proactive agent." The tool can run continuously in the background, proactively prompt users about to-do items, and handle a variety of work tasks. Claude Duet is currently still in research preview, and users need to join a waitlist to gain access. This means the product cannot yet directly compete in the broader market with agent products such as Meta's newly launched Muse and OpenAI's Dots. Anthropic said Duet was developed based on its flagship model Opus 5.5. Individual Stock News Most large technology stocks fell in pre-market trading. According to a pre-market summary, IBM (IBM.US) fell more than 5%, Applied Materials (AMAT.US) fell more than 4%, and Marvell Technology, Inc. (MRVL.US) fell nearly 2%; Micron Technology, Inc. (MU.US), SanDisk (SNDK.US), SK Hynix (SKHY.US), Intel Corporation (INTC.US) and others fell about 4%; NVIDIA Corporation (NVDA.US) fell more than 2%. Meta (META), which had risen more than 7% at one point earlier on its Q3 results, turned lower in pre-market trading by about 2%. Meta reports Q3 results after the bell: revenue beats expectations, capital expenditure increased with a bet on AI. The company's third-quarter revenue reached $64.600 billion, up 26.00% year over year, beating analysts' expectations of $63.300 billion, with growth mainly driven by the advertising business. Dragged down by a one-time legal settlement expense of $9.890 billion, diluted earnings per share were $3.83, below market expectations; excluding that one-time expense, EPS would have reached $7.40. The company also raised its guidance, expecting fourth-quarter revenue of $73 billion to $76 billion, with the midpoint above market expectations; and raised the lower end of its 2026 capital expenditure guidance from the previous $130 billion to $135 billion, while keeping the upper end unchanged at $145 billion, further increasing investment in AI computing power and data centers. Tesla, Inc. (TSLA.US) delivers mixed results after the bell: revenue slightly below expectations, capital expenditure sharply cut. The company's third-quarter revenue was $28.05 billion, below analysts' expectations of $28.13 billion; adjusted earnings per share were $0.48, above expectations of $0.44; quarterly free cash flow was $1.53 billion, significantly better than the nearly $5 billion shortfall the market had originally feared. But the key variable in focus was capital expenditure: Tesla, Inc. cut its full-year 2026 capital expenditure target directly from "more than $25 billion" to about $20 billion (a reduction of about 20%), and actual capital expenditure this quarter of $4.73 billion was also far below the market estimate of $7.95 billion. The chief financial officer called it "efficient management of capital deployment," but investors worry that the contraction in capital expenditure will affect the pace of investment in long-term stories such as AI, humanoid Siasun Robot&Automation, and robotaxis. Amid AI bubble concerns, Texas Instruments Incorporated (TXN.US) delivers solid results: Q3 revenue and profit both beat expectations, Q4 guidance unexpectedly strong. Analog chip maker Texas Instruments Incorporated reported fiscal 2026 third-quarter results, with revenue of $6.06 billion, above analysts' expectations of $5.90 billion, up 27.7% year over year and 2.6% above expectations; GAAP earnings per share were $2.62, 8% above analysts' expectations of $2.43. In addition, the company's revenue guidance for the next quarter (midpoint $6.05 billion) was unexpectedly strong, 5.6% above analysts' expectations. Procter & Gamble Company (PG.US) Q1 results beat expectations across the board: organic sales growth of 4%, volume recovery reverses growth structure. Procter & Gamble Company reported fiscal 2027 first-quarter results. The report showed Q1 net sales of $23.3 billion, up 4% year over year, above expectations of about $22.8 billion; core earnings per share were $2.00, up 1% year over year, above expectations of $1.89. The company had previously guided core EPS to decline 5% or more year over year for the quarter, but it actually rose instead of falling. The market's most closely watched organic sales growth reached 4%, far exceeding the consensus estimate of about 2% (even the most optimistic investment banks, UBS Group AG and Evercore ISI, forecast only 2.6%3%). American Airlines Group Inc. (AAL.US) Q3 revenue of $16.3 billion sets a record, but a 67% surge in fuel costs is the biggest drag, with a net loss expected for the full year. American Airlines Group Inc. released its fiscal 2026 third-quarter (ended September 30) results on October 22. The report showed total revenue for the quarter was $16.34 billion, up 19.3% year over year, setting the company's highest record excluding post-pandemic years and exceeding the upper end of its previous guidance range. Nevertheless, the airline expects a loss for 2026, abandoning its previous guidance range that allowed for either profit or loss, because persistently high jet fuel prices have outpaced fare increases, continuing to squeeze the company's profit margins. Several major U.S. banks discover unauthorized AI agents accessing accounts. Sources said several major U.S. banks are discovering unauthorized third-party artificial intelligence agent programs operating within customer accounts, with some agents even attempting to execute operations that appear independent of user instructions. Because it is difficult to distinguish humans from unauthorized Siasun Robot&Automation, banks have been forced to block the technology and quickly revise their terms of service. It is reported that Morgan Stanley (MS.US), Bank of America Corp (BAC.US), JPMorgan (JPM.US), Wells Fargo & Company (WFC.US) and other banks are racing to contain agent risks. People familiar with the matter said some banks have detected unauthorized access. According to people familiar with the matter, Morgan Stanley has begun blocking third-party agents from accessing its platform. JPMorgan, Bank of America Corp and Citi (C.US) are also restricting agent access. SpaceX (SPCX.US) and Tesla, Inc. (TSLA.US) are reportedly aiming to reach a merger deal in the first half of next year. According to people familiar with the matter, the parties are pushing for Tesla, Inc. and SpaceX to announce a merger in the first half of 2027 so that the merger can be completed during the current Trump administration. U.S. midterm elections will be held in less than two weeks. If Democrats control either chamber of Congress, Musk and his companies could face investigations, and it could also weaken the influence of a president increasingly entering lame-duck status. At the same time, if the selloff in chip and AI stocks continues, investor support may weaken, potentially affecting whether this ambitious deal can move forward. Meta's personal AI agent Muse surpasses 10 million users one month after launch. Meta CEO Mark Zuckerberg said Wednesday that Muse, Meta's new personal AI agent app, has attracted more than 10 million users since its launch in September. On Meta's third-quarter earnings call, Zuckerberg said Muse's growth momentum "remains strong," with shopping currently the most common use case. He said more than a quarter of Muse users make purchases through the app, with an average transaction value of more than $200. Key Economic Data and Event Preview 20:30 Beijing time: U.S. initial jobless claims for the week ended October 17 22:00 Beijing time: Eurozone October consumer confidence index preliminary reading Earnings Preview Friday morning: Western Digital Corporation (WDC.US), Bloom Energy (BE.US) Friday pre-market: American Express Company (AXP.US), SLB (SLB.US)