Cloud cash flow divides the market as GDP and inflation data approach
Five things to know before the open on Thursday, October 29.
Good morning. Earnings are pulling the market in different directions before a busy U.S. data release. These are the five headlines for Thursday, October 29.
1. The cloud earnings split weighs on technology futures
Nasdaq-100 futures were lower ahead of the open as Alphabet fell in premarket trading while Microsoft gained. CNBC and Reuters reported that contrast following the companies' latest results. Both reported strong cloud growth, but their cash generation differed: Alphabet reported negative quarterly free cash flow of about $9.1 billion, while Microsoft generated about $18.6 billion. Early trading is not a closing result, and cloud revenue growth does not by itself measure the return on every AI investment. Our First Light market report has the overnight context.
2. GDP and PCE are still ahead, not already in the numbers
The Bureau of Economic Analysis schedules the advance estimate of third-quarter GDP and September personal income and outlays for 8:30 AM ET. The latter includes the PCE inflation measures. The official schedule and Macro Bullseye agree on the time. At this edition's 8:00 AM publication, those releases are still pending. Growth and inflation will give investors separate pieces of evidence after Wednesday's Fed rate hold; a forecast before the release is not an actual result.
3. Caterpillar grows revenue, but shares fall before the bell
Caterpillar reported third-quarter sales and revenues of $20.7 billion, up 17%, with profit per share of $7.13 and adjusted profit per share of $7.20. The company release and Reuters reported the revenue growth and adjusted result. CNBC and Reuters reported a premarket decline in the shares despite earnings that beat expectations. Reuters said the company maintained its full-year sales-growth outlook. The distinction matters: a completed quarter and expectations for the rest of the year can pull investors in different directions. Adjusted earnings exclude restructuring costs and are not the same measure as reported profit per share.
4. Samsung's record profit does not settle the payout question
Samsung reported consolidated third-quarter revenue of 195.3 trillion won and operating profit of 107.4 trillion won for the quarter ended September 30, using its own rounded figures. Its shares closed 4.13% lower in Seoul. Samsung's release, CNBC and The Korea Times reported the results and shareholder-return plans. The company announced a 30 trillion won third-quarter cash dividend, while final plans for an anticipated 55 trillion to 75 trillion won remainder of its estimated annual 2026 shareholder returns wait until late January 2027. That remainder is not another quarterly dividend or money already paid. See our primary-source-checked Samsung report.
5. Shell raises its buyback after adjusted earnings nearly double
Shell reported adjusted earnings of $10.81 billion, compared with $5.43 billion a year earlier, and announced a $5 billion share buyback for the next three months, up from $3 billion in the previous quarter. The company release and CNBC reported the results and repurchase program. Indicative refining margins reached $42 a barrel. Those adjusted earnings are not a crude-price quote or statutory net profit, and an announced buyback is not a completed repurchase. Our Shell report explains the measures.
The morning's reading habit: separate what has been reported from what is still forecast. Earnings, buyback plans, futures prices and the coming economic releases each answer a different question.
