It was a huge week in terms of earnings reports and economic news. The news was led by reports from five of the mega-caps. Overall, the reports from the mega-caps were a mixed bag. Alphabet (GOOG) and Amazon.com (AMZN) closed 3.4% and 5.4% higher. Apple (AAPL), Meta Platforms (META), and Microsoft (MSFT) closed with losses ranging from 1.1% to 4.2% following their reports. The S&P 500 declined 1.4%, the Nasdaq Composite declined 1.5%, and the Dow Jones Industrial Average settled 0.2% lower. The Russell 2000 eked out a 0.1% gain on the week.
The semiconductors group showed weakness throughout the week. Advanced Micro Devices (AMD) was a notable loser, dropping 9.2% after reporting earnings and giving disappointing guidance for the next quarter. Broadcom (AVGO) lost 2.4% during the week due to a news report contending that Apple (AAPL) may sever ties with Broadcom and shift to in-house Wi-Fi chips by 2028. The PHLX Semiconductor Index (SOX) settled 4.1% lower for the week.
October nonfarm payrolls increased by 12,000 which was well below consensus of 120,000. The 3-month average for total nonfarm payrolls decreased to 104,000 from 148,000. The unemployment rate, however, was unchanged from September at 4.1%. Treasury yields fell immediately following the weak creation of jobs. The key takeaway from the report is that it has reinvigorated the market’s view that the Fed will stay on a steady rate-cut path that will include cutting rates by 25 basis points at this week’s Fed meeting and again at the December meeting.