Closing Recap

Thursday, October 16, 2025

U.S. stocks were up all morning long before fading late morning into lows this afternoon, led by a sharp decline in financials/banks. Regional banks (KRE) led the decline following disclosures of losses for both WAL and ZION tied to suspected loan fraud, sparking renewed concern over credit quality at regional banks. Zions reported a $50M charge-off at its California Bank & Trust unit, while Western Alliance said a borrower failed to provide collateral on pledged loans but maintained its 2025 outlook. This credit concern story weighed on sentiment as banks continued to sell down all afternoon (more details below). Tech strength helped the Nasdaq Comp limit losses early, thanks to another record high in the SOX semi-index, gains by CRM after guidance at its Dreamforce conference and a jump in ORCL after metrics at its financial analyst meeting (lifting data centers). But as broader markets gave up gains, tech followed as well, and all eleven S&P sectors closed lower. The Smallcap Russell 2000 Index fell over -2% after posting record closing highs the last two days. Transports a bright spot today as JBHT shares jumped after earnings and better guidance while UAL shares fell on results. The CBOE Volatility index (VIX) hit highs above 25 today, its highest level since May. Still, investors still await developments on the U.S.-China trade front as U.S. Treasury Secretary Scott Bessent emphasized on Wednesday that Trump was ready to meet his Chinese counterpart in South Korea later this month. Also, markets await any details on improved talks in Washington to reopen the government as the shutdown rolls into Day 17 tomorrow.

• U.S. October NAHB Housing market index 37 (consensus 33), the highest since April and versus 32 in September (previous 32); current single-family home sales 38 versus 34 in September; index of home sales over next six months 54 versus 45 in September; 38% of builders cut prices, averaging a 6% reduction, the largest in a year, while 65% used incentives to attract buyers.
• The U.S. budget deficit shrank by $41 billion to $1.775 trillion in the 2025 fiscal year, despite a $118 billion increase in revenues from tariffs. It was the first time the annual deficit had fallen since 2022. The smaller deficit was aided by a record $195 billion in net customs receipts for the fiscal year, an increase of $118 billion from the prior year as new Trump tariffs rolled in. Total receipts for fiscal 2025 were a record $5.235 trillion, up $317 billion, or 6%, from the $4.918 trillion in fiscal 2024.

• U.S. WTI crude oil futures settle at $57.46/bbl, falling -$0.81 or 1.39% while Brent crude fell -$0.85 or 1.37% to settle at $61.06 per barrel. U.S. and India have had productive discussions that have led India to already cut Russia oil imports by 50% according to a White House official today.
• Bitcoin prices tumbled over -2.5% below $108,500 as risk assets saw pressure midday, dragging down crypto miners. US 2-year Treasury yield decreased 8.4 bps to 3.42%, marking its lowest level since September 2022 while the 10-year yield slipped over 7-bps to below 4% (6 ½ month lows at 3.97%). Lots of rotation into havens as bonds and gold advanced as risk assets saw another sell the bounce today.

• In Food & Restaurants: Nestlé SA (NSRGY) shares surged after the food maker posted a stronger-than-expected increase in quarterly sales and announced plans to slash 16,000 jobs, just weeks after replacing its CEO. Goldman recapped the 12th annual guided tour of the National Association of Convenience Stores conference saying energy drinks dominated the conversation with MNST, CELH, and Red Bull driving innovation, new flavors, and targeting female consumers. JACK entered into a definitive agreement to sell Del Taco Holdings Inc. to Yadav Enterprises Inc. for $115M in cash.

• In Autos: NIO shares fell after Chinese media outlet Caixin reported that Singapore’s sovereign wealth fund, the Government of Singapore Investment Corporation, filed a lawsuit against NIO and its two executives. Ford (F) to recall over 59,000 US vehicles over fire risks, NHTSA said.

• In Energy: SEI announced that Amanda Brock has been named Co-Chief Executive Officer of the Company, effective October 16, 2025. She will serve alongside Bill Zartler, who will continue as Chairman and Co-CEO. Ms. Brock has also been appointed to the Solaris Board of Directors. MMS announced it has been awarded a new $31M contract by the Massachusetts Health Connector, an independent public authority. Under the four-year base contract, Maximus will provide enrollment and premium billing services.

• BK Q3 adj EPS $1.91 vs. est. $1.77; Q3 revs rose 9% y/y to $5.08B vs. est. $4.97B; Q3 Net Interest Income (NII) $1.24B vs. est. $1.18B); Q3 assets under custody and administration rose 11% in the quarter ended Sept. 30 to $57.8 trillion from a year earlier.
• BMO said it will sell 138 U.S. branches to FCNCA, transferring $5.7B in deposits and $1.1B in loans. BMO will take a $75M goodwill charge and plans to open 150 new branches over five years.
• CBSH Q3 EPS $1.06 vs. est. $1.10; Q3 net Income $141.518M vs. vs. est. $146.9M; Q3 revs $440.96M vs. EST $447.8M; Q3 net interest income $279.457M; and Q3 credit loss provision $20.061M.
• KEY reports Q3 adj EPS $0.41 vs. est. $0.38; revs rose to $1.9B from $695M a year earlier, surpassing analyst forecasts of a rise to $1.88B; said revenue growth was driven by net interest income tailwinds and adjusted noninterest income growth of 8%, which he said continues to grow faster than expenses.
• SCHW reports Q3 adj. EPS of $1.31, beating analysts’ estimates of $1.25 on better revs $6.14B vs. est. $6.01B and said total client assets at $11.59 trillion, rising 17% y/y growth; Q3 total net new assets $134.4B, est. $130.25B.
• SNV Q3 EPS $1.46 vs. est. $1.40; Q3 revs $615.39M vs. est. $598.4M; Q3 Net interest income grew $15.1M, or 3% q/q and $34M, or 8% y/y; Average loans increased 1% from the prior quarter, driven by growth in structured lending and commercial real estate lines of business.

• In FinTech: FI was downgraded to Hold from Buy at Deutsche Bank in Q3 FinTech preview citing deteriorating fundamentals, increasing competition, and a looming reinvestment cycle and said they are most optimistic on V, XYZ, and KLAR, while we are most concerned about FI, FOUR, and PYPL. While the firm continues to anticipate relative macro stability, says it is impossible to ignore the deluge of headlines pointing to potential cracks emerging across the global economy, particularly lower-income consumers. In news, PYPL shares slipped after COIN said its Coinbase Business will simplify vendor payments, eliminate chargebacks, and offer seamless API integrations.
• In Digital Asset Treasury sector (DATCO): B Riley initiated BMNR Buy and $90 PT, SBET Buy and $32 PT, FGNX Buy and $8 PT, NAKA Buy, and $2 PT and SQNS Buy and $13 PT in DATCO sector (digital asset Treasury companies) saying DATCOs hold Cryptocurrencies as their primary assets, operating like closed-end funds. DATCOs exploit market opportunities through capital allocation: When their stock prices exceed the value of their crypto holdings (trading at a premium to NAV), they issue new shares to buy more crypto, thus increasing assets per share.

• In Towers: Citigroup lowered price tgts on tower stocks, AMT to $225 from $250, CCI to $110 from $124, SBAC to $235 from $265 (but stay Buy rated on all) after removing leasing revenue from SATS and contributions to future growth beginning in 2026 as the broker says sees significant uncertainty over how EchoStar will handle future payments.

• KVUE shares fell as the consumer health company faces new legal challenges over talc-related cancer claims. A lawsuit filed in the High Court of England represents over 3,000 individuals who allege that Kenvue’s baby powder caused ovarian cancer, mesothelioma, and other diseases between 1965 and 2023
• MRK announces phase 3 keynote trial met secondary endpoint of overall survival in all-comers population of patients with platinum-resistant recurrent ovarian cancer.
• PRAX shares surged more than 200% early after announces positive topline results from two pivotal phase 3 studies of Ulixacaltamide HCl in the essential3 program for essential tremor.
• In Medtech: GRAL and Samsung C&T signed a binding Letter of Intent for a strategic collaboration to bring GRAIL’s Galleri multi-cancer early detection (MCED) test to key Asian markets. SCT and SEC have also agreed to invest $110 million into GRAIL.
• In Life Sciences: TMO said it is collaborating with OpenAI to help improve the speed and success of drug development/it is embedding OpenAI APIs (Application Programming Interfaces) into areas such as product development, service delivery and customer engagement
• In Medical Research: TEM signed a multi-year partnership with WHWK to use its real-world multimodal data for biomarker-driven cancer research.

• In Airlines: UAL reported Q3 RASM of -4.3% worse than the consensus -2.9% while revenue growth came in at 2.6% vs. consensus 3.3% and costs were well-managed/that said, Q4 outlook implies strong RASM/Revenue acceleration on a tough year ago comp.

• In Chemicals: PPG upgraded from Neutral to Overweight at JP Morgan as thinks that PPG’s public market value has decreased more than its business fundamentals have weakened both over the past year and the past five years; thinks there is room for PPG’s earnings growth to accelerate in 2026.
• In Rare Earth/Lithium sector: ABAT shares fell after saying the U.S. Department of Energy has terminated its grant for the setting up of a facility for the manufacturing of battery cathode grade lithium hydroxide. LAC was downgraded to Underweight from Neutral at JP Morgan with a $5 price target. CRML said they will raise $50 million through a private investment in public equity (PIPE) deal with an institutional investor and use net proceeds to fund its Tanbreez rare earth deposit in Greenland. DFLI shares fall after prices $55.4M public offering at $1.35 per share. Bloomberg reported the US Defense Department canceled a tender to buy cobalt, in a fresh sign of the challenges facing Western countries trying to bolster domestic supplies of the battery metal.

• In Media & Telecom: TKO was upgraded to Buy from Neutral at Seaport Global with a $214 price target, turning more constructive after recent share pullback and believes the company will see executional growth ahead thanks to site license fees, sponsorships, and multisport market takeovers. RUM and Perplexity launch subscription bundle that include Rumble Premium and Perplexity Pro; users will get the bundle for $19.99 per month when they sign up before December 31, directly on Rumble
• In Telecom: TMUS was upgraded from Equal Weight to Overweight at Wells Fargo and raise tgt to $260 saying relative valuation multiple premium, particularly vs AT, has compressed the past 12 months, while EBITDA and FCF/share growth will only accelerate in 2026+ from 2025 levels.

• In Software: CRM shares rose after telling investors at the company’s annual Dreamforce conference that it expects revenue of more than $60 billion in 2030. It also guided for an organic y/y revenue growth rate above 10% in 2026 through 2030. They also unveiled $7 billion share buyback program over next six months. SNOW and PLTR announced a new partnership that integrates Snowflake’s AI Data Cloud with Palantir Foundry and Palantir Artificial Intelligence Platform (AIP).
• In IT Sector: Indian IT service names INFY and WIT both active after earnings this morning; Deutsche Bank previewed the IT Service sector saying believes the overall demand environment in IT Services is likely to remain muted in the near term, with no line of sight to a recovery in short-cycle discretionary projects and the firm sees CTSH and G as the relatively best-positioned names in its coverage group heading into CYQ325 earnings, while it thinks DAVA and GLOB have the most downside risk
• Computer Hardware: HPE shares fell after issuing weaker-than-expected guidance for 2026 at its Analyst Day as expects FY26 adj EPS $2.20-$2.40, with revenue growing between 5%-10% which compared to estimates of $2.43 and revenue growth of 17%. CRCT shares were downgraded to Sell from Neutral at Goldman Sachs to reflect its evolving stance on the company’s growth trajectory and risk/reward profile.
• In Networking & Equipment: FFIV shares tumbled, adding to prior day losses after yesterday noted federal networks targeted by ‘significant cyber threat’ using vulnerabilities in F5 products.

• TSM Q3 profit beat analysts’ estimates. Revenue surged 30% from a year earlier to 989.92 billion New Taiwanese dollars s. NT$977.46B expected; Q3 net income: NT$452.3B, vs. NT$417.69B, boosted by strong demand for its AI semiconductors, which manufactures for chip makers like NVDA; said is now expecting mid-30% revenue growth for the year vs. 30% rise forecast previously.
• MU price tgt raised to $245 from $225 at UBS saying their latest round of industry checks points to a very robust demand environment being met by acute and worsening DRAM supply shortages. For DRAM, UBS has seen an additional uptick in legacy DDR demand projections from US hyperscalers w/ DDR bit demand now doubling Y/Y. UBS also upgraded Samsung Electronics (SSNLF) to Buy given it believes the memory industry is entering acute shortages from now and into 2026.