Stocks Rise as Verizon Has Worst Day Since 2002; Oracle Up, Chips Fade

It's Friday, October ninth. This is Trade and Ticker, the lunch report. Here's your midday check on U.S. stocks.

Three things still matter into the afternoon. First, the A-I trade, which bounced at the open and has now split in two, with cloud and software names higher and chip stocks giving back their early gains. Second, a historic selloff in the big wireless carriers after SpaceX's airwaves deal. Third, the consumer, after a sentiment report this morning showed Americans gloomier and expecting more inflation, just ahead of next week's inflation report and the start of bank earnings.

Here's the picture at midday. Stocks are higher across the board after two down days, and this time the Dow is leading. As of about one-fifteen Eastern, the Dow is up about seven-tenths of a percent, or roughly three hundred sixty points. The S-and-P and the Nasdaq are each up about half a percent. Small companies are up about half a percent too. Health care and real estate are the strongest corners of the market, and communication services is the weakest, dragged down by the phone companies.

Rates and oil are calm. The ten-year Treasury yield is up just slightly, at about five-point-two-five percent. Brent crude is down about half a percent, near one hundred four dollars a barrel, and U.S. crude is near ninety-one dollars. Gold is up more than one percent.

The big story is wireless. Verizon is down more than nine percent and is on pace for its worst day since two thousand two. T-Mobile is down about thirteen percent, and A-T-and-T is down about ten percent. SpaceX agreed to buy a nationwide block of low-band airwaves from Grain Management, in a deal the Wall Street Journal valued at about eight billion dollars. Those airwaves would help SpaceX's Starlink phone service reach inside buildings and compete with the carriers head on. A-S-T SpaceMobile, which is building its own satellite-to-phone network, is down about fifteen percent. The tower companies are going the other way. Crown Castle is up nearly thirteen percent, American Tower is up more than seven, and S-B-A Communications is up about six, on the idea that more competition means more equipment on towers. SpaceX itself has cooled off and is up about one percent. Federal Communications Commission Chair Brendan Carr told CNBC this morning that more competition is good news for consumers.

In tech, the morning bounce in chips has faded. A widely followed basket of chip stocks is down nearly eight-tenths of a percent after opening higher. Nvidia is down a bit, and A-M-D is down almost two percent. Buyers moved into cloud and software instead. Oracle is up about four and a half percent after saying its big New Mexico data center campus is on schedule, and Mizuho named it a top pick. Microsoft and Amazon are each up more than two percent, Palantir is up more than three, and Lumentum is up nearly seven percent. Tesla is up about two percent. Apple is the drag among the giants, down more than one and a half percent on the report of iPhone order cuts.

Humana is still one of the day's biggest winners, up about twelve percent after its Medicare Advantage star ratings bounced back, and it picked up an analyst upgrade. Alignment Healthcare is down about fourteen percent. Delta Air Lines is down almost two percent after cutting its full-year profit forecast on fuel costs, though C-E-O Ed Bastian told CNBC he is not seeing any slowdown in travel demand. United and American are lower too.

On the economy, the University of Michigan's first read on October consumer sentiment fell to forty-six-point-three, from forty-eight-point-one in September. That is the second-lowest reading on record. The gauge of current conditions fell more than twelve percent, as high prices and borrowing costs hit plans to buy big-ticket items. And year-ahead inflation expectations rose to four-point-seven percent, the highest since May. That keeps pressure on the Fed to keep raising rates.

After the close today, there are no notable earnings. The bigger story is next week. Monday is Columbus Day. The stock market is open, but the bond market is closed. Then earnings season starts for real on Tuesday morning, with JPMorgan Chase, Goldman Sachs, Wells Fargo, and Citigroup, plus UnitedHealth and Johnson and Johnson. The September consumer price index arrives Wednesday. Bank stocks are higher today, with Wells Fargo up nearly two percent and JPMorgan up about half a percent.

Watch three things into the close. First, whether chip stocks stay under water while the rest of tech climbs, which would show the worries about OpenAI's revenue haven't gone away. Second, whether the phone company selloff deepens into the final hour. Third, oil into the weekend, with Hurricane Isaias expected to make landfall on the northern Gulf Coast late tonight or early Saturday, and about sixty-three percent of Gulf oil production already shut in.

That's the midday picture. We'll be back this evening with a company deep dive on the day's biggest stories, including the SpaceX shock to the wireless carriers, Delta's fuel problem, and Humana's star ratings comeback. Thanks for listening. I'm Trade and Ticker.