Stock Market Volatility Jumps to 5-Month High as Trump's Trade War and AI Valuation Worries Return

Stocks on Wall Street advanced on Wednesday following the previous day's volatile session amid escalating trade tensions between the U.S. and China. 

The S&P 500 index increased 0.4%, the Nasdaq Composite advanced 0.6%, and gold and silver notched new record highs. 

China imposed port fees on U.S. ships arriving at their destinations in retaliation to the U.S. president's threat to impose additional 100% tariffs on Chinese goods. 

The fears of tit-for-tat tariff escalation led to tumultuous trading on Tuesday, and investors sought safe haven in precious metals and drove up high-tech stocks. 

Investors remained focused on the latest earnings releases, and Bank of America and Morgan Stanley reported better-than-expected quarterly results. 

Goldman Sachs and JPMorgan Chase reported strong quarterly results on Monday. 

PNC Bank, Regions Financial, American Express, and Charles Schwab are scheduled to release their results later in the week. 

U.S. Stock Movers

Bank of America Corp. gained 2.5% to $52.52 after reporting its third-quarter revenue and earnings, which exceeded market expectations. 

Revenue rose 11% to $28.1 billion, net income advanced to $8.5 billion from $6.9 billion, and diluted earnings per share increased to $1.06 from 89 cents a year ago. 

Provisions for credit losses edged down to $1.3 billion, compared to $1.5 billion in the quarter a year ago and $1.6 billion in the second quarter. 

Morgan Stanley jumped 3.5% to $160.88, and the investment bank and asset manager reported a rise in revenue and earnings in the third quarter. 

Revenue rose 18% to $18.2 billion from $15.4 billion, net income advanced 45% to $4.6 billion from $3.2 billion, and diluted earnings per share jumped to $2.80 from $1.88 a year ago. 

Net new asset flow in its wealth management unit jumped to $81 billion and generated a pre-tax margin of 30%. 

Total client assets across the wealth and investment management platform increased to $8.9 trillion. 

ASML Holding jumped 4% to $1,025.37, and the Dutch semiconductor equipment maker said the current fiscal year's revenues are likely to surpass those from fiscal 2025.  

Stock Market Volatility Jumps to 5-Month High as Trump's Trade War and AI Valuation Worries Return

Stocks on Wall Street advanced on Wednesday following the previous day's volatile session amid escalating trade tensions between the U.S. and China. 

The S&P 500 index increased 0.4%, the Nasdaq Composite advanced 0.6%, and gold and silver notched new record highs. 

China imposed port fees on U.S. ships arriving at their destinations in retaliation to the U.S. president's threat to impose additional 100% tariffs on Chinese goods. 

The fears of tit-for-tat tariff escalation led to tumultuous trading on Tuesday, and investors sought safe haven in precious metals and drove up high-tech stocks. 

Investors remained focused on the latest earnings releases, and Bank of America and Morgan Stanley reported better-than-expected quarterly results. 

Goldman Sachs and JPMorgan Chase reported strong quarterly results on Monday. 

PNC Bank, Regions Financial, American Express, and Charles Schwab are scheduled to release their results later in the week. 

U.S. Stock Movers

Bank of America Corp. gained 2.5% to $52.52 after reporting its third-quarter revenue and earnings, which exceeded market expectations. 

Revenue rose 11% to $28.1 billion, net income advanced to $8.5 billion from $6.9 billion, and diluted earnings per share increased to $1.06 from 89 cents a year ago. 

Provisions for credit losses edged down to $1.3 billion, compared to $1.5 billion in the quarter a year ago and $1.6 billion in the second quarter. 

Morgan Stanley jumped 3.5% to $160.88, and the investment bank and asset manager reported a rise in revenue and earnings in the third quarter. 

Revenue rose 18% to $18.2 billion from $15.4 billion, net income advanced 45% to $4.6 billion from $3.2 billion, and diluted earnings per share jumped to $2.80 from $1.88 a year ago. 

Net new asset flow in its wealth management unit jumped to $81 billion and generated a pre-tax margin of 30%. 

Total client assets across the wealth and investment management platform increased to $8.9 trillion. 

ASML Holding jumped 4% to $1,025.37, and the Dutch semiconductor equipment maker said the current fiscal year's revenues are likely to surpass those from fiscal 2025.  

Japan's Indexes Advanced After Powell Comments Raised Hopes for U.S. Rate Cuts

Japan's market indexes rebounded for the second consecutive day amid hopes of U.S. rate actions, but political uncertainty limited market gains. 

The Nikkei 225 Stock Average surged 1.8%, and the broader Topix increased 1.5% after comments from the Fed Chair Jerome Powell raised prospects of rate cuts at the next policy meeting. 

Powell confirmed that the economy is slightly stronger than previously estimated, but employment risks are rising. 

"While the unemployment rate remained low through August, payroll gains have slowed sharply, likely in part due to a decline in labor force growth due to lower immigration and labor force participation. 

In this less dynamic and somewhat softer labor market, the downside risks to employment appear to have risen," said Powell while delivering his comments at the NABE meeting in Philadelphia. 

Moreover, LDP leader Sanae Takaichi is facing higher hurdles in winning her bid for Japan's premiership, as opposition parties are looking for a way to put up a unified front.  

Japan Indexes and Stocks 

The Nikkei 225 Stock Average rose 1.8% to 47,683.10, and the broader Topix gained 1.5% to 3,182.03. 

SoftBank Group advanced 5% to ¥21,945.0, Tokyo Electron gained 2.2% to ¥29,070.0, and Advantest Corp. increased 2.2% to ¥17,365.0. 

Mitsui O.S.K. Lines increased 0.2% to ¥4,378.0, Kawasaki Kisen Kaisha Ltd. added 0.07% to ¥2,067.0, and Nippon Yusen KK fell 0.3% to ¥5,012.0. 

Japan's Indexes Advanced After Powell Comments Raised Hopes for U.S. Rate Cuts

Japan's market indexes rebounded for the second consecutive day amid hopes of U.S. rate actions, but political uncertainty limited market gains. 

The Nikkei 225 Stock Average surged 1.8%, and the broader Topix increased 1.5% after comments from the Fed Chair Jerome Powell raised prospects of rate cuts at the next policy meeting. 

Powell confirmed that the economy is slightly stronger than previously estimated, but employment risks are rising. 

"While the unemployment rate remained low through August, payroll gains have slowed sharply, likely in part due to a decline in labor force growth due to lower immigration and labor force participation. 

In this less dynamic and somewhat softer labor market, the downside risks to employment appear to have risen," said Powell while delivering his comments at the NABE meeting in Philadelphia. 

Moreover, LDP leader Sanae Takaichi is facing higher hurdles in winning her bid for Japan's premiership, as opposition parties are looking for a way to put up a unified front.  

Japan Indexes and Stocks 

The Nikkei 225 Stock Average rose 1.8% to 47,683.10, and the broader Topix gained 1.5% to 3,182.03. 

SoftBank Group advanced 5% to ¥21,945.0, Tokyo Electron gained 2.2% to ¥29,070.0, and Advantest Corp. increased 2.2% to ¥17,365.0. 

Mitsui O.S.K. Lines increased 0.2% to ¥4,378.0, Kawasaki Kisen Kaisha Ltd. added 0.07% to ¥2,067.0, and Nippon Yusen KK fell 0.3% to ¥5,012.0. 

China's Inflation Reports Confirm Entrenched Deflationary Forces

Stocks in China and Hong Kong edged higher, and investors awaited the start of earnings season and debated the prospects of additional stimulus.

The Hang Seng Index gained 1.2%, and the mainland-focused CSI 300 index inched up 0.03% after the release of two inflation reports. 

Consumer price inflation slowed to an annual 0.3% in September, and producer price inflation, the National Bureau of Statistics reported Wednesday. 

Prices declined at a slower pace than the annual fall of 0.4% in the previous month, but the deflationary trend is likely to persist for the foreseeable future. 

Core inflation, which excludes volatile food and energy prices, accelerated to 1% from 0.9% in August, the highest in nine months. 

Consumer goods prices fell 0.8%, while services prices advanced 0.8% in September.  

Food price decline deepened to 4.4% from 4.3%, the sharpest fall since January 2024 amid a broad-based fall across all categories. 

China's producer price inflation slowed but extended the deflationary trend to the 36th consecutive month amid overcapacity and weak consumer demand. 

Producer price inflation eased to 2.3% in September from 2.9% in the previous month, as policymakers worked behind the scenes to curb excess capacity in several key manufacturing sectors. 

On a monthly basis, producer prices remained flat from August, driven by a rise in demand ahead of the Golden Week holiday season. 

China Indexes and Stocks

The Hang Seng index increased 1.2% to 25,754.71, and the mainland-focused CSI 300 index edged up 0.03% to 4,537.73. 

Alibaba Group Holding increased 2.9% to HK $160.10, Tencent Holdings edged up 0.6% to HK $625.50, and Meituan gained 0.9% to HK $99.20. 

HSBC Holdings plc added 1.8% to HK $103.70, China Life Insurance jumped 3.2% to HK $22.64, and China Merchants Bank edged up 0.8% to HK $48.56. 

Xuanzhu Biopharmaceutical soared 135% to HK $26.50 after the company priced its initial public offering at HK $11.60 per share and sold 67.3 million shares. 

The biopharma company focused on digestive diseases, oncology, and non-alcoholic steatohepatitis raised net proceeds of HK$701 million. 

China's Inflation Reports Confirm Entrenched Deflationary Forces

Stocks in China and Hong Kong edged higher, and investors awaited the start of earnings season and debated the prospects of additional stimulus.

The Hang Seng Index gained 1.2%, and the mainland-focused CSI 300 index inched up 0.03% after the release of two inflation reports. 

Consumer price inflation slowed to an annual 0.3% in September, and producer price inflation, the National Bureau of Statistics reported Wednesday. 

Prices declined at a slower pace than the annual fall of 0.4% in the previous month, but the deflationary trend is likely to persist for the foreseeable future. 

Core inflation, which excludes volatile food and energy prices, accelerated to 1% from 0.9% in August, the highest in nine months. 

Consumer goods prices fell 0.8%, while services prices advanced 0.8% in September.  

Food price decline deepened to 4.4% from 4.3%, the sharpest fall since January 2024 amid a broad-based fall across all categories. 

China's producer price inflation slowed but extended the deflationary trend to the 36th consecutive month amid overcapacity and weak consumer demand. 

Producer price inflation eased to 2.3% in September from 2.9% in the previous month, as policymakers worked behind the scenes to curb excess capacity in several key manufacturing sectors. 

On a monthly basis, producer prices remained flat from August, driven by a rise in demand ahead of the Golden Week holiday season. 

China Indexes and Stocks

The Hang Seng index increased 1.2% to 25,754.71, and the mainland-focused CSI 300 index edged up 0.03% to 4,537.73. 

Alibaba Group Holding increased 2.9% to HK $160.10, Tencent Holdings edged up 0.6% to HK $625.50, and Meituan gained 0.9% to HK $99.20. 

HSBC Holdings plc added 1.8% to HK $103.70, China Life Insurance jumped 3.2% to HK $22.64, and China Merchants Bank edged up 0.8% to HK $48.56. 

Xuanzhu Biopharmaceutical soared 135% to HK $26.50 after the company priced its initial public offering at HK $11.60 per share and sold 67.3 million shares. 

The biopharma company focused on digestive diseases, oncology, and non-alcoholic steatohepatitis raised net proceeds of HK$701 million. 

US-China Trade Tensions Overwhelmed Positive Earnings Releases

Stock market indexes turned lower and erased gains of the previous session as US-China trade tensions escalated. 

The S&P 500 index decreased 1.1%, and the tech-heavy Nasdaq Composite fell 1.4% amid worries that rapidly escalating trade tensions between the two largest economies could spiral out of control. 

Gold edged up 0.2% to 4,135.60, and silver decreased 2.2% to $51.27 as investors continued to shift away into safe haven assets amid falling trust in the U.S. dollar-denominated assets. 

The U.S. crude oil prices dropped to a five-year low of $57.21 per barrel amid worries about shrinking global demand as economies in the U.S., Europe, and Japan struggle to advance and China's growth slows. 

U.S. Stock Movers 

JPMorgan Chase & Company declined 0.8% to $305.60, and the leading financial services provider reported better-than-expected quarterly results, driven by a surge in trading and investment banking revenue. 

Johnson & Johnson edged up 0.7% to $192.13, and the company's third-quarter results surpassed market expectations. 

Revenue in the third quarter rose to $23.99 billion, and adjusted earnings per share were $2.80.  

The drug and medical device maker raised its 2025 revenue outlook to a new range between $93.5 billion and $93.9 billion, about $300 million higher than the previous estimate. 

The company said it plans to spin off its orthopedic division, which makes knee, hip, and shoulder implants, generating $9.2 billion in revenue in 2024, about 10% of total revenue. 

Goldman Sachs Group decreased 1.2% to $777.0, and the investment banking and asset management services provider's third-quarter results surpassed market expectations. 

Revenue increased to $15.2 billion from $14.6 billion, net income advanced to $3.86 billion from $3.47 billion, and diluted earnings per share advanced to $12.25 from $10.91 a year ago. 

US-China Trade Tensions Overwhelmed Positive Earnings Releases

Stock market indexes turned lower and erased gains of the previous session as US-China trade tensions escalated. 

The S&P 500 index decreased 1.1%, and the tech-heavy Nasdaq Composite fell 1.4% amid worries that rapidly escalating trade tensions between the two largest economies could spiral out of control. 

Gold edged up 0.2% to 4,135.60, and silver decreased 2.2% to $51.27 as investors continued to shift away into safe haven assets amid falling trust in the U.S. dollar-denominated assets. 

The U.S. crude oil prices dropped to a five-year low of $57.21 per barrel amid worries about shrinking global demand as economies in the U.S., Europe, and Japan struggle to advance and China's growth slows. 

U.S. Stock Movers 

JPMorgan Chase & Company declined 0.8% to $305.60, and the leading financial services provider reported better-than-expected quarterly results, driven by a surge in trading and investment banking revenue. 

Johnson & Johnson edged up 0.7% to $192.13, and the company's third-quarter results surpassed market expectations. 

Revenue in the third quarter rose to $23.99 billion, and adjusted earnings per share were $2.80.  

The drug and medical device maker raised its 2025 revenue outlook to a new range between $93.5 billion and $93.9 billion, about $300 million higher than the previous estimate. 

The company said it plans to spin off its orthopedic division, which makes knee, hip, and shoulder implants, generating $9.2 billion in revenue in 2024, about 10% of total revenue. 

Goldman Sachs Group decreased 1.2% to $777.0, and the investment banking and asset management services provider's third-quarter results surpassed market expectations. 

Revenue increased to $15.2 billion from $14.6 billion, net income advanced to $3.86 billion from $3.47 billion, and diluted earnings per share advanced to $12.25 from $10.91 a year ago. 

Japan's Indexes Dropped 2% as Traders Unwound Takaichi Trade

Japan's market indexes fell sharply on Tuesday as traders unwound the so-called "Takaichi trade."

The Nikkei 225 Stock Average dropped 2.3%, and the broader Topix fell 2.2% amid rising political uncertainty and growing skepticism about LDP leader Sanae Takaichi's bid for the premiership.

Benchmark indexes in Tokyo soared more than 5% after the LDP elected Sanae Takaichi, and investors hoped that the newly elected leader's support for ultra-loose monetary policy and a fiscally expansionary stance would support higher highs in stocks. 

However, those expectations faced a wall of reality after the Komeito Party announced its plans to leave the ruling coalition after 26 years, voicing its deep skepticism about Takaichi's policies. 

Market sentiment was further dented after the U.S. president threatened additional steep tariffs on China, as both sides remained far apart in resolving differences. 

The Japanese yen strengthened to 151.83 against the U.S. dollar amid rising hurdles to Takaichi's bid to become Japan's next prime minister. 

Japan Indexes and Stocks 

The Nikkei 225 Stock Average dropped 2.3% to 46,971.84, and the broader Topix fell 2.2% to 3,128.01. 

Tech stocks extended losses amid worries about the U.S. trade policy. 

Tokyo Electron Ltd. dropped 2.4% to ¥28,575.0, Advantest Corp. fell 3.3% to ¥17,235.0, and Lasertec Corp. declined 1.9% to ¥19,840.0. 

Ocean freight shipping companies advanced after tensions in the Middle East eased following a ceasefire agreement between Hamas and Israel. 

Kawasaki Kisen Kaisha Ltd. added 2.2% to ¥2,063.50, Mitsui O.S.K. Lines Ltd. added 0.6% to 4,373.0, and Nippon Yusen KK advanced 0.7% to ¥5,010.0.  

Japan's Indexes Dropped 2% as Traders Unwound Takaichi Trade

Japan's market indexes fell sharply on Tuesday as traders unwound the so-called "Takaichi trade."

The Nikkei 225 Stock Average dropped 2.3%, and the broader Topix fell 2.2% amid rising political uncertainty and growing skepticism about LDP leader Sanae Takaichi's bid for the premiership.

Benchmark indexes in Tokyo soared more than 5% after the LDP elected Sanae Takaichi, and investors hoped that the newly elected leader's support for ultra-loose monetary policy and a fiscally expansionary stance would support higher highs in stocks. 

However, those expectations faced a wall of reality after the Komeito Party announced its plans to leave the ruling coalition after 26 years, voicing its deep skepticism about Takaichi's policies. 

Market sentiment was further dented after the U.S. president threatened additional steep tariffs on China, as both sides remained far apart in resolving differences. 

The Japanese yen strengthened to 151.83 against the U.S. dollar amid rising hurdles to Takaichi's bid to become Japan's next prime minister. 

Japan Indexes and Stocks 

The Nikkei 225 Stock Average dropped 2.3% to 46,971.84, and the broader Topix fell 2.2% to 3,128.01. 

Tech stocks extended losses amid worries about the U.S. trade policy. 

Tokyo Electron Ltd. dropped 2.4% to ¥28,575.0, Advantest Corp. fell 3.3% to ¥17,235.0, and Lasertec Corp. declined 1.9% to ¥19,840.0. 

Ocean freight shipping companies advanced after tensions in the Middle East eased following a ceasefire agreement between Hamas and Israel. 

Kawasaki Kisen Kaisha Ltd. added 2.2% to ¥2,063.50, Mitsui O.S.K. Lines Ltd. added 0.6% to 4,373.0, and Nippon Yusen KK advanced 0.7% to ¥5,010.0.  

China Indexes Flatlined, Gold and Silver Jumped to New Record Highs

In China, stocks wavered amid ongoing trade tensions with the U.S., while precious metals advanced to new record highs.

The Hang Seng Index decreased 0.5%, and the mainland-focused CSI 300 index fell 0.1% as investors hoped that the U.S. and China will find common ground on tariffs and trade restrictions before the end of this month. 

Chinese goods are facing about 55% tariffs in the U.S., and overall levies could surge to as high as 145% if the two sides fail to finalize a trade deal in the next three weeks. 

Moreover, China has started sourcing soybeans and other agricultural products from Argentina, Brazil, Peru, Australia, and Uganda and cut down its purchases from the U.S. by more than 90%. 

The Hang Seng Index is likely to extend its recent string of losses to the seventh day, as investors worry that the latest trade spat is likely to further dent China's trade with the U.S. 

In the nine months to September, China's exports to the U.S. have fallen by more than 33%, and Chinese manufacturers are developing markets in the ASEAN region, the European Union, Latin America, and Africa.  

Investors in Asia dumped the U.S.-dollar-denominated assets and shifted to gold, a safe-haven asset, amid lingering anxiety over a prolonged U.S. shutdown and a 25-basis-point rate cut later this month. 

Gold advanced 0.9% to $4,167.70 an ounce, and silver jumped 1.4% to $53.50 an ounce, and they reached new record highs amid rising trade tensions between the two largest economies of the world. 

China Indexes and Stocks 

The Hang Seng Index decreased 0.5% to 25,772.25, and the mainland-focused CSI 300 index fell 0.1% to 4,590.64. 

Tech stocks wavered in Hong Kong trading as investors awaited the start of the earnings season later in the week. 

Alibaba Group Holding Ltd. dropped 2% to HK $159.30, Tencent Holding decreased 1.4% to HK $630.0, and Meituan fell 0.2% to $99.65.  

Pop Mart International Group dropped 2.4% to HK $267.20, Nongfu Spring Co. eased 0.1% to HK $53.95, and Zijin Mining Group declined 1.1% to HK $33.82. 

China Indexes Flatlined, Gold and Silver Jumped to New Record Highs A

In China, stocks wavered amid ongoing trade tensions with the U.S., while precious metals advanced to new record highs.

The Hang Seng Index decreased 0.5%, and the mainland-focused CSI 300 index fell 0.1% as investors hoped that the U.S. and China will find common ground on tariffs and trade restrictions before the end of this month. 

Chinese goods are facing about 55% tariffs in the U.S., and overall levies could surge to as high as 145% if the two sides fail to finalize a trade deal in the next three weeks. 

Moreover, China has started sourcing soybeans and other agricultural products from Argentina, Brazil, Peru, Australia, and Uganda and cut down its purchases from the U.S. by more than 90%. 

The Hang Seng Index is likely to extend its recent string of losses to the seventh day, as investors worry that the latest trade spat is likely to further dent China's trade with the U.S. 

In the nine months to September, China's exports to the U.S. have fallen by more than 33%, and Chinese manufacturers are developing markets in the ASEAN region, the European Union, Latin America, and Africa.  

Investors in Asia dumped the U.S.-dollar-denominated assets and shifted to gold, a safe-haven asset, amid lingering anxiety over a prolonged U.S. shutdown and a 25-basis-point rate cut later this month. 

Gold advanced 0.9% to $4,167.70 an ounce, and silver jumped 1.4% to $53.50 an ounce, and they reached new record highs amid rising trade tensions between the two largest economies of the world. 

China Indexes and Stocks 

The Hang Seng Index decreased 0.5% to 25,772.25, and the mainland-focused CSI 300 index fell 0.1% to 4,590.64. 

Tech stocks wavered in Hong Kong trading as investors awaited the start of the earnings season later in the week. 

Alibaba Group Holding Ltd. dropped 2% to HK $159.30, Tencent Holding decreased 1.4% to HK $630.0, and Meituan fell 0.2% to $99.65.  

Pop Mart International Group dropped 2.4% to HK $267.20, Nongfu Spring Co. eased 0.1% to HK $53.95, and Zijin Mining Group declined 1.1% to HK $33.82. 

China TUESDAY

China Indexes and Stocks 

The Hang Seng Index decreased 0.5% to 25,772.25, and the mainland-focused CSI 300 index dropped 0.4% to 

China TUESDAY

China Indexes and Stocks 

The Hang Seng Index decreased 0.

U.S. Movers: Bassett Furniture, Costco, Delta Air Lines, PepsiCo

Bassett Furniture Industries decreased 1.8% to $16.50 despite the company reporting improved sales and net income swinging to a profit.

Revenue in the third quarter rose to $80.1 million from $75.6 million, and net income per share increased to a profit of 9 cents, compared to a loss of 52 cents a year ago. 

PepsiCo increased 0.7% to $139.80 after the beverage and snack company reported better-than-expected results in the third quarter. 

Net revenue increased 2.6% to $23.9 billion from $23.3 billion, net income attributable to shareholders eased to $2.6 billion from $2.9 billion, and diluted earnings per share decreased to $1.90 from $2.13 a year ago. 

“Our reported net revenue growth accelerated and reflects the resilience of our international business, improved momentum within North America Beverages, and the benefits of our portfolio reshaping actions,” said Chairman and CEO Ramon Laguarta. 

The company guided 2025 organic revenue to increase in "low single digits" and core constant currency earnings per share to match the prior year's level. 

Delta Air Lines increased 5.9% to $60.50, and the international carrier's third-quarter results surpassed market expectations, and it issued a strong outlook.

Total operating revenue in the third quarter increased by 6%, reaching $16.7 billion, up from $15.7 billion; net income rose by 11% to $1.41 billion, compared to $1.27 billion; and diluted earnings per share increased to $2.17 from $1.97 a year ago. 

The airline guided fourth-quarter revenue to rise between 2% and 4% from a year ago and adjusted earnings per share between $1.60 and $1.90. 

Costco Wholesale Corp. advanced 1.4% to $928.10 after the membership warehouse club operator reported monthly sales data.

Sales in the five-week period ended October 5 rose 8% to $26.58 billion, and the U.S. same-store sales advanced 5.1% in the period.