Mid-Morning Look

Thursday, October 23, 2025

U.S. stocks open the trading day high, bouncing off losses Wednesday as investors digest another busy round of earnings, and prepare for the first notable economic data point in three weeks tomorrow, the consumer price index (CPI) inflation report. Earnings are plentiful as roughly 20% of the S&P report this week, with highlights overnight/this morning including big gains for AA in metals space, DOW in chemicals, LVS in casinos, LC in lending, HON in multi-industry among big winners early. Shares of TSLA slip on earnings results, IBM falls on slowing cloud rev growth, MOH tumbles on miss/lower guide hitting managed care. Regarding trade news, stocks slipped yesterday after reports the White House is considering a curb on software exports to China in response to Beijing’s move to restrict rare earth shipments, reigniting fears of a fresh set of retaliatory trade sanctions. President Trump also maintained optimism he can work out deal with President Xi, however, he has also warned that additional 100% tariffs will go ahead on 1-Nov if no deal is reached. Gold prices a solid 2% rebound this morning, Treasury yields rebound and Bitcoin prices also move higher with lots of volatility in crypto/gold this week.

In energy markets, oil prices jumped to 2-week highs after overnight, US Treasury for the first time launched sanctions directly targeting Rosneft and Lukoil, Russia’s two largest oil companies, lifting oil prices. This morning, news wires reported Chinese state oil majors have suspended purchases of seaborne Russian oil after the United States imposed sanctions on Moscow’s two biggest oil companies. The move comes as refiners in India, the largest buyer of seaborne Russian oil, are set to sharply cut their crude imports from Moscow, to comply with the U.S. sanctions imposed over the Kremlin’s invasion of Ukraine.

• In Industrials Metals: in steels, RS Q3 LIFO adj operating EPS of $3.64, below consensus $3.68, and a guidance range of $3.60-$3.80. Sales were above our estimate on volume/share gains (pricing/mix neutral), but LIFO gross margins were 60 bps below view at 28.3% and 29.9% in 2Q25. CMC was downgraded from Buy to Hold at Jefferies due to valuation following the recent rally to a YTD high and a lower capital return trajectory due to recent announced acquisitions. In aluminum, KALU rises on results and raised guidance while AA reported a narrower Q3 EPS loss, while revs of $3B just missed estimates saying results were hurt by lower alumina prices and lower trading activity.
• In Auto earnings today: TSLA shares slipped on mixed Q3 earnings results as they beat both revenue and gross margin expectations, but disappointing in other areas (e.g. the automotive non-GAAP gross margin and non-GAAP EPS). Auto retailer AN Q3 revenue up 7% to $7 bln, beating analyst expectations while adjusted EPS for Q3 rises 25% to $5.01, surpassing analyst estimates as the company reports record profits in After-Sales and Customer Financial Services with gross profit of $597M and a gross margin increase of 100bps; SAH worse fate as shares fell after Q3 profit misses estimates. In Auto suppliers, VC posted EPS beat but revs miss and backed FY25 guidance of $3.70-$3.85B saying guidance does not contemplate any potential impact of Nexperia supply disruptions.

• AVY +3%; was upgraded from Neutral to Buy at UBS and JP Morgan as they think both RFID and adj EPS growth could inflect higher in 2026 supported by a new WMT RFID roll out into bakery, meat, and deli sections of the store which UBS thinks can add >10% growth to AVY RFID sales over the next 2 years
• DOW +11%; rises on smaller Q3 operating EPS loss (-$0.19) though revenue $9.97B missed est. $10.23B; Company achieved sequential EBIT growth through cost reductions and operational improvements.
• GSAT +7%; shares jumped a report in the Information said the chair of Globalstar, James Monroe, has talked to associates about the possibility of selling his satellite company for more than $10B, said people who heard him make the remarks (current market capitalization is $5.3B). https://tinyurl.com/58pcktrj
• HON +5%; raised its full-year profit outlook to $10.60-$10.70 from $10.45-$10.65 and reported Q3 earnings that topped Wall Street expectations, boosted by the company’s aerospace unit ahead of a planned breakup, though did cut FY25 revenue view to $40.7B-$40.9B from $40.8B-$41.3B.
• LC +16%; reported Q3 operating EPS of $0.37, well above expectations, with core PPNR beating due to strong origination fees with loan volume increasing 37% y/y to $2.62B; strong credit also drove the beat with NCOs improving meaningfully; guidance was also positive.
• LVS +10%; as reports Q3 adj. EPS of $0.78 topping estimates of $0.60 on better revs $3.33B vs $3.03B expected as Macau revenue up 7.6% to $1.91B and Singapore revenue surges 56.3% to $1.44 bln, both topping forecasts; raised annual dividend to $1.20 and expands stock buyback to $2B.
• RGTI +8%; along with gains in IONQ, QBTS, QUBT after the WSJ reported certain companies are discussing the government becoming a shareholder as part of agreements to get funding earmarked for promising technology companies, according to people familiar with the matter https://tinyurl.com/yeyjtpd4
• VKTX +12%; after results last night and Cantor reiterated its Overweight rating and $105 price tgt saying Viking “crystallized five critically important data catalysts in the next 24 months” and the company affirmed cash on hand of greater than $700M was sufficient to get through all of them.
• VTYX +89%; said its oral drug VTX3232 cut key inflammation markers tied to heart disease in patients with obesity and cardiovascular risk; said its drug lowered hsCRP by about 80% in the first week; levels of IL-6, a protein linked to heart risk, also dropped below the threshold for cardiovascular risk.
• WST +11%; boosted FY adjusted EPS outlook to $7.06–$7.11 from $6.65–$6.85 and also raised its yearly sales forecast to $3.06–$3.07B from $3.04–$3.06B which followed handily top/bottom line beats for Q3.

• MOH -18%; shares tumbled after lowered EPS guidance for the third time this year and expect 2026 EPS to be flat at $14, which is 40% below consensus of $19.33; consolidated medical care ratio of 92.6% for Q3; its Q3 results miss at EPS $1.84 missing the $3.90 consensus on better revs $11.48B
• MRNA -3%; after saying it would stop development of a vaccine designed to prevent birth defects caused by cytomegalovirus, or CMV, once among its most-watched experimental programs.
• ROP -7%; reported mixed Q3 results and narrowed year EPS view and reaffirmed FY rev outlook; but shares fell on weaker Q4 guidance of $5.11-$5.16 EPS vs. est. $5.23.
• SMCI -6%; after guiding Q2 revs $5.0B vs. est. $6.5B though reiterates FY26 revs at least $33B
• TSLA -3%; after extended its profit streak loss to a fourth quarter due to pressure from rising costs, even as sales hit record highs; mixed Q3 results as they beat both revenue and gross margin expectations, but disappointed in other areas (e.g. the automotive non-GAAP gross margin and non-GAAP EPS).