Mid-Morning Look

Thursday, October 30, 2025

U.S. stocks were little changed overnight as investors digested the FOMC announcement the day prior (they cut rates by 25bps, but a rate cut in December is now a lower probability), and tech earnings while President Trump and Chinese leader Xi reached some parts of trade deals but was not as in depth as many had hoped. In earnings, an onslaught of results this morning, with META the highlight to the downside on weaker margins, increased capex and a bond offering hitting shares, while GOOGL results crush estimates in all segments, boosting those shares. Lots of big movers across various sectors (details below). Stocks pressured early with a little pullback in prior day winners (Tech) while the defensive sectors like REITs Staples, Utilities seeing a bounce today along with Financials. After several days of underperformance, Smallcap Russell 2000 is outperforming this morning. Through this morning, 280 of the S&P 500 companies reported thus far vs 290 LY (fiscal qtr ending Aug-Oct) with

84% beat vs 77% LY; the avg beat 23% vs 29% LY, avg miss -15% vs -12% LY; the avg yr/yr earnings growth 18% vs 16% LY and the median yr/yr earnings growth 10% vs 6% LY, as per Reuters data.

In trade news overnight, President Trump said he had agreed with President Xi Jinping to trim tariffs on China in exchange for Beijing cracking down on the illicit fentanyl trade, resuming U.S. soybean purchases and keeping rare earths exports flowing. Trump’s met face-to-face talks with Xi for the first time since 2019 last night. Trump said tariffs on Chinese imports would be cut to 47% from 57%, by halving to 10% the rate of tariffs related to trade in fentanyl precursor drugs. China agreed to pause export controls unveiled this month on rare earths, elements with vital roles in cars, planes and weapons that have become Beijing’s most potent source of leverage in its trade war with the United States. They also agreed to pause tit-for-tat port fees on shipping

Dollar index continuing higher here hitting new Oct highs and coming up on the 8/1 highs at 100.257. Treasury yields jumping the last 18 hours despite the Fed cutting rates again yesterday by 25 bps as the December FOMC policy meeting cut is now up in the air after Powell comments dampen expectations. The 10-yr yield +3bps to 4.09% and the 2-yr yield +4.3bps to 3.627% after both jumping notably yesterday. Bitcoin under pressure as Fed’s injects doubt into dovish policy path with prices falling -3% to $108,000 and Ethereum -4% below $3,800.

The European Central Bank (ECB) decided to keep their three key interest rates unchanged (as expected) saying inflation remains close to the 2% medium-term target and the Governing Council’s assessment of the inflation outlook is broadly unchanged. The economy has continued to grow despite the challenging global environment. However, the outlook is still uncertain, owing particularly to ongoing global trade disputes and geopolitical tensions. In Japan, The Bank of Japan (BoJ) maintained its policy stance in a 7-2 split, mirroring its September decision, with both Takata and Tamura dissenting in favor of a rate hike.

• In Food: UTZ posted Q3 sales $377.8M above ests $374.4M and raises 2025 Organic Net Sales growth guidance to approximately 3%; Kellanova (K) topped Q3 estimates for sales and profit, driven by resilient demand for its ready-to-eat breakfast items and snacks; HSY Q3 EPS/sales top consensus, raises annual sales forecast after upbeat quarterly results on strong confectionery and snacks demand as sees annual net sales growth of about 3%, up from prior at least 2%. SFM tumbles after softer than expected Q3 comp delivery and guided Q4 below the Street; Q3 EPS of $1.22 topped Street $1.17 with stronger gross margins and expense controls more than offsetting a weaker than expected top-line delivery.
• Keybanc noted five Apartment REITs reported 3Q25 results, including two NFFO beats (ESS, UDR) and three misses (AVB, IRT, MAA). Two increased ‘25 NFFO guidance (ESS, UDR), while one affirmed (IRT) and two decreased (AVB, MAA). Operating fundamentals have trended below prior projections due to softer pricing power, and occupancy and bad debt appear mixed vs. prior guidance. While the Apt. REITs have underperformed the REITs by 1,680 bps YTD, weakening trends may not be enough to exceed the low bar heading into 3Q25 earnings, but recent buyback activity may provide some support to shares.

• CAH +16%; posts Q3 EPS and revs handily above consensus and raised its earnings forecast for fiscal 2026 to a range of $9.65 to $9.85 per share, up from its previous forecast of $9.30 to $9.50.
• CHRW +18%; shares jump on results Q3 adj EPS $1.34 vs est $1.30, on revs $4.1B vs est $4.266B.
• GH +27%; delivered another robust 12% top line beat and raised its guide well in excess of the beat.
• GKOS +22%; shares rise as reported strong Q3 as Glaucoma revenue of $110.2M; reported Q3 sales/EPS beat and raised FY25 guidance by $9.5M and provided preliminary FY26 sales outlook bracketing consensus.
• GOOGL +5%; beat Street revenue consensus by 3% and Street Op Income by 7%; Google accelerated across all key revenue lines (Search, YouTube Ads, Cloud); AI driving accelerating query growth, which is translating into accelerating Paid Click growth (+7% Y/Y, the fastest since 2023) and expands margins.
• LLY +2%; raised its full-year profit and revenue forecast, betting on surging demand for its blockbuster GLP-1 drugs; guides FY EPS $23.00-$23.70 above its prior view of $21.75-$23.00 and ests $22.18).
• MTSR +21%; shares jumped after NVO said it has made an unsolicited bid for the drug maker after PFE in September made an offer for the company. Novo said it had offered $56.50 per share in cash for Metsera, corresponding to an enterprise value of $6B (above prior PFE bid of $47.50 or $4.8B).
• NOW +5%; posted a strong print with 20.5% CC cRPO growth 250bps above guidance; OM was ~300bps better due to sustained GenAI efficiencies, and management increased FY25 FCF margin guidance by 200bps and raised its subscription revenue outlook.

• CLF -12%; after the company 75M share Spot Secondary priced at $12.85.
• CMG -16%; shares tumbled as Q3 results included in-line EPS as lower than expected G&A expenses offset the Company’s SSS growth/store-level margin shortfall, while lowered its full-year SSS growth forecast to the negative LSD range, implying a low MSD decline in the Q4.
• EBAY -12%; as Q3 GMV came in nearly 3% above the high end of guidance as Focus Category growth accelerated five points, to +15% Y/Y, but gross profit margins contracted 90bps and PF operating margins contracted 10bps Y/Y as GAAP operating income fell by $19M Y/Y.
• FMC -43%; shares tumble following a large Q4 miss on increased generic price pressure in LATAM and Asia, an 86% dividend cut to preserve cash and sharply lowered its outlook for the year.
• IP -9%; as swings to quarterly loss, as the packaging firm recorded a $1B charge related to the sale of its cellulose fibers business; the company also reported revs of $6.22B missing the $6.5B estimate (follows weaker results from SW the day prior as shares sunk on Q3 miss).
• META -11%; posted Q3 beats for EPS, revs ($51B, up 25% Y/Y ex-FX) was solidly (3%) ahead of consensus, but shares slipped as operating margin came in at 40%, down from 43% last year and announced a significant increase in its investment spend plans for ’26 (both CAPEX and TotEx).
• SFM -21%; after softer than expected Q3 comp delivery and guided Q4 below the Street; Q3 EPS of $1.22 topped Street $1.17 with stronger gross margins and expense controls more than offsetting a weaker than expected top-line delivery; comps increased 5.9% below Street of +7.4% and guidance of +6.0-8.0%.