The major averages sunk as a trio of tech giants declined following their earnings reports last night. Apple (AAPL), the biggest of the bunch, dragged the market down with it, but Amazon (AMZN) and Facebook (FB) did not help matters with their own post-earnings slumps. Alphabet (GOOGL) was the exception on the upside as the only member of the tech quartet to move higher following its blow-out results.
ECONOMIC EVENTS: In the U.S., personal income rose 0.9% in September, with spending up 1.4%, which both beat expectations. The Chicago PMI manufacturing index slipped -1.3 points to 61.1, which was a smaller decline than expected. The University of Michigan consumer sentiment survey inched up to 81.8 in the final October print from 81.2 in the preliminary reading.
In energy news, Baker Hughes reported that the U.S. rig count is up nine from last week to 296 with oil rigs up 10 to 221.
The Federal Reserve Board announced that it has adjusted the terms of the Main Street Lending Program in "two important ways" to better target support to smaller businesses that are facing continued revenue shortfalls due to the pandemic. In particular, the minimum loan size for three Main Street facilities available to for-profit and non-profit borrowers has been reduced from $250,000 to $100,000 and the fees have been adjusted to encourage the provision of these smaller loans.
Data from the Johns Hopkins Whiting School of Engineering shows there are now 45.2M confirmed cases of COVID-19 worldwide, including about 9M in the U.S., and 1.18M deaths due to the disease, including about 229,000 in the U.S. In other COVID-19 news, the U.K. reported 24,405 new cases of the virus on Friday, according to Reuters.
TOP NEWS: Shares of Apple (AAPL) fell 5.6% despite the company's report Thursday night of better than expected sales and earnings and CEO Tim Cook's assertion that "the early response to all our new products, led by our first 5G-enabled iPhone lineup, has been tremendously positive."
Shares of Amazon (AMZN) were 5.4% lower following the company's Q3 results despite JPMorgan analyst Doug Anmuth, and several of his peers, raising their price targets on the shares. Anmuth believes Amazon exceeded high expectations on the top-line and said that while the cost is high, the company is making significant investments to keep up with elevated demand and deliver for customers in a way that few, if any, others can through this time period.
Shares of Facebook (FB) fell 6.3% as well despite its report prompting a number of price target hikes around the Street. Among those getting more bullish, RBC Capital analyst Mark Mahaney raised the firm's price target on Facebook to $350 from $320 as he contends that the company's Q4 guidance suggests revenue growth acceleration and reflects a "full V-shaped recovery."
Alphabet (GOOG, GOOGL) was the outlier among its peer group as class A shares gained 3.8% after the parent of Google reported revenue and profit that beat analysts' consensus forecasts by a wide margin.
Outside of tech earnings, shares of Chevron (CVX) rose 1% and those of Exxon Mobil (XOM) were down just over 1% following their respective quarterly reports. Chevron reported an adjusted profit when a loss was expected while posting lower than expected revenue. Meanwhile, Exxon saw a quarterly loss, even after adjustments, but topped revenue forecasts. Exxon, whose losses were not as bad as forecast when excluding some items, also confirmed plans to cut the size of its workforce and said it may divest more assets than previously communicated.
Shares of cruise line stocks, including Carnival (CCL), Royal Caribbean (RCL), and Norwegian Cruise Line (NCLH), rallied after the U.S. Centers for Disease Control and Prevention announced a framework for a phased resumption of cruise ship passenger operations in U.S. waters after expiration of CDC's No Sail Order on October 31.
Meanwhile, the Federal Trade Commission said that Pfizer (PFE) and Mylan (MYL) have agreed to divest assets and abide by other conditions to settle FTC charges that the proposed combination of Upjohn and Mylan will harm current or future competition in ten generic drug markets.
Reuters reported Johnson & Johnson (JNJ) intends to start testing its experimental COVID-19 vaccine in youths aged 12 to 18 as soon as possible.
MAJOR MOVERS: Among the noteworthy gainers was Equillium (EQ), which rose 5.8% after receiving FDA clearance to begin a Phase 3 clinical trial evaluating itolizumab in hospitalized COVID-19 patients suffering from acute respiratory distress syndrome. Also higher were MoneyGram (MGI), Plantronics (PLT), and Under Armour (UA), which advanced after reporting quarterly results.
Among the notable losers were Twitter (TWTR), Opko Health (OPK), and Atlassian (TEAM), which fell 21.1%, 16.2%, and 9.1%, respectively, after reporting quarterly results.
INDEXES: The Dow fell 157.51, or 0.59%%, to 26,501.60, the Nasdaq lost 274.00, or 2.45%, to 10,911.59, and the S&P 500 declined 40.15, or 1.21%, to 3,269.96.
