A post-election rebound meets earnings and economic tests
Five things to know before the open on Wednesday, November 4.
Good morning. The election result is in, but the market's verdict is still moving. Stock futures have recovered from overnight losses, AMD is drawing buyers after earnings, and a busy U.S. data calendar is about to test the rebound.
1. Futures turn higher after the midterm sweep
U.S. stock-index futures rose Wednesday after Democrats won control of the House and Senate. Contracts tied to the Dow, S&P 500 and Nasdaq recovered from sharp overnight declines as investors weighed what divided government could mean for taxes, spending and AI regulation. The dollar weakened and Treasury yields fell. The overnight market reversal is the starting point, not a guarantee of where cash trading will finish.
2. AMD's data-center growth brings buyers back
AMD shares rose in premarket trading after its third-quarter report. Revenue reached $13.38 billion, up 45% from a year earlier, while data-center revenue rose 97% to $8.5 billion. The company forecast fourth-quarter revenue of about $17 billion, plus or minus 3%. Those figures give investors another measure of AI-computing demand, even as the election raises questions about the pace of data-center construction. Our earnings report separates the growth from the costs behind it.
3. Novo raises its forecast, with a profit caveat
Novo Nordisk now expects full-year adjusted sales and adjusted operating profit to range from a 2% decline to 2% growth at constant exchange rates, an improvement from its previous forecast of a 6% decline to no growth. Third-quarter sales were 79.2 billion Danish kroner, supported by GLP-1 demand and roughly 5.4 billion kroner of Wegovy pill sales. But reported operating profit fell 9% at constant exchange rates after impairment charges. The adjusted-versus-reported distinction is worth keeping in view.
4. Hiring and services data are next
The ADP private-employment report is scheduled for 8:15 AM ET, followed by the U.S. trade balance at 8:30 AM, final services PMI at 9:45 AM and ISM services at 10:00 AM. The reports will add evidence on hiring and business demand after the election-driven overnight swings. ADP measures private payrolls; it is not the government's jobs report.
5. Treasury's borrowing plans put bonds in focus
The Treasury's quarterly refunding announcement is due at 8:30 AM ET. Investors will be watching the planned mix and size of debt auctions, alongside the early move lower in Treasury yields. Any change in auction sizes will matter alongside investors' new expectations for spending and taxes under divided government.
