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- 🗞️ American Express Surges on Record Profits
🗞️ American Express Surges on Record Profits
Big Moves Decoded: NEM, ORCL, and GILD
Market Performance
S&P 500: 6,664.01 ⬆️ 0.53%
Nasdaq: 22,679.98 ⬆️ 0.52%
Dow Jones: 46,190.61 ⬆️ 0.52%
American Express Delivers in Q3
Strong spending by America's affluent consumers helped American Express (AXP) post record quarterly revenue.
The card issuer reported Q3 earnings per share of $4.14 on revenue that climbed 11% year-over-year to a record $18.43 billion, both figures topping analysts' forecasts.
What's driving this success? CEO Stephen Squeri pointed to the company's launch of updated high-end credit cards, noting that demand and engagement have exceeded expectations.
New U.S. Platinum account acquisitions doubled compared to pre-refresh levels, reinforcing American Express's leadership in the premium space.
AXP also raised its full-year outlook, now projecting EPS of $15.20 to $15.50 (up from $15 to $15.50 previously) and revenue growth of 9% to 10%.
Credit metrics remained best-in-class, with a net write-off rate of just 1.9%—flat year-over-year despite economic headwinds.
AXP stock jumped more than 7% following the announcement, trading around $346 and on track for a record close.
The stock has climbed about 15% this year, outpacing the S&P 500's roughly 13% gain.
AXP stock has a Ziggma score of 73, as it trails peers across metrics such as profitability and valuation.
Our Takeaway
American Express proves that premium consumers remain resilient.
While other financial institutions grapple with credit concerns, Amex's focus on affluent cardholders and elevated experiences continues to pay dividends.
The doubling of Platinum card acquisitions post-refresh signals strong demand in the high-end market.
Market Overview 📈
Friday's session saw all three major indexes close higher as traders digested softening rhetoric on U.S.-China trade negotiations and recovered from credit concerns that sparked Thursday's regional bank sell-off.
The positive momentum accelerated in afternoon trading after Treasury Secretary Scott Bessent announced he would speak with his Chinese trade counterpart on Friday evening.
President Trump also indicated a meeting with Chinese President Xi Jinping remained likely at month's end, suggesting the threat of 100% additional tariffs against China on November 1st might not materialize.
Regional banks rebounded sharply after Thursday's rout, with investors betting recent bad loan disclosures from Zions and Western Alliance were isolated incidents rather than systemic issues.
Zions Bancorp climbed nearly 6% after receiving an upgrade from Baird, while Jefferies closed up 6% following an Oppenheimer rating boost. Better-than-expected earnings from Fifth Third Bancorp further assuaged credit worries.
The CBOE Volatility Index, which briefly topped 28—its highest level since April—retreated as stocks bounced, signaling easing fears.
Despite recent volatility, all three major indexes finished the week higher, with the S&P 500 rising 1.7%, the Dow adding 1.6%, and the Nasdaq gaining 2.1%.
Stock Moves Deciphered 📈
🌧️ Oracle (ORCL) ⬇️ 6.9%
Oracle shares fell more than 7% despite announcing a strong long-term forecast at its AI World conference in Las Vegas.
The cloud infrastructure giant expects revenue to rise at a 31% compound annual growth rate over the next five years and announced a major cloud computing deal with Meta.
However, investors were concerned about near-term earnings targets and a perceived over-reliance on major AI clients like OpenAI.
🖌️ Estée Lauder (EL) ⬆️ 4.1%
Estée Lauder shares continued a multi-day rally, building on momentum from a recent "Buy" upgrade from Goldman Sachs.
Analysts cited stabilizing demand in China—a critical market for luxury cosmetics—and improved profit margins as key growth drivers.
The beauty giant is benefiting from operational improvements and signs that Chinese consumer spending may be stabilizing.
💉 Gilead Sciences (GILD) ⬆️ 4.2%
Gilead Sciences advanced after Goldman Sachs raised its price target following positive Phase 3 study results for Trodelvy, the company's cancer drug.
The biotech firm's oncology pipeline continues to show promise, with Trodelvy positioned as a potential blockbuster treatment across multiple cancer types.
The positive trial data reinforce confidence in Gilead's transformation beyond its HIV and hepatitis franchises.
🥇 Newmont Corporation (NEM) ⬇️ 7.6%
Newmont's stock dropped as gold prices pulled back from record highs.
As the world's largest gold producer, Newmont's shares closely track precious metal prices.
The decline came as investors took profits following gold's recent rally to all-time highs, though the long-term outlook for gold remains supported by geopolitical uncertainties and central bank demand.
Headlines You Can't Miss 👀
📊 UBS upgraded global equities to attractive, citing favorable U.S. growth outlooks and accelerating AI adoption momentum as catalysts for further gains.
🏦 Regional bank credit concerns eased as Moody's analyst Marc Pinto said there are few signs of credit contagion that might fuel larger problems.
🚜 UBS upgraded Deere to buy from neutral, lifting its price target to $545 per share on expectations of an earnings inflection ahead.
📉 Jobless claims declined last week to about 217,000, down from 234,000 the previous week, according to Goldman Sachs estimates.
💳 Charles Schwab reported high retail interest across energy, communication services, consumer discretionary, and health care sectors, with significant inflows into these names.
🇨🇳 U.S.-China trade tensions softened after Treasury Secretary Scott Bessent confirmed talks with his Chinese counterpart and Trump signaled a likely Xi meeting.
🏦 SPDR S&P Regional Banking ETF closed 1.6% higher Friday, recovering from Thursday's 6% decline despite ending the week 1.9% lower overall.
📈 Fifth Third Bancorp earnings beat expectations, with profit jumping last quarter even after posting increased credit losses tied to bankrupt subprime auto lender Tricolor.
Trending Stocks 📊
👨💻 AppFolio (APPF)
The cloud-based business software provider climbed 7% after KeyBanc upgraded the stock to overweight from equal weight, setting a 12-month price target of $285.
The upgrade reflects growing confidence in AppFolio's market position in property management software as the real estate sector stabilizes.
The company's comprehensive platform for property managers continues to gain traction, particularly among mid-sized property management firms looking to digitize operations and improve efficiency.
📵 AST SpaceMobile (ASTS)
Shares of the space-based broadband cellular network dropped almost 7% despite more than doubling over the past month.
Barclays double-downgraded its investment rating to underweight from overweight while maintaining its $60 price target, citing "excessive" valuation.
Analyst Mathieu Robilliard noted that while AST has unique features—including its recent deal with Verizon to provide cellular service from space beginning next year—valuation has run ahead of fundamentals.
💊 Revolution Medicines (RVMD)
The late-stage clinical oncology company jumped 10% after announcing the FDA granted a National Priority Voucher for daraxonrasib (RMC-6236), a multi-selective inhibitor.
The voucher program is designed to incentivize the development of treatments for severe conditions affecting smaller patient populations.
What’s Next?
Key market and macro news 👇
💰 Major Earnings Reports: Cleveland-Cliffs and Steel Dynamics report Q3 earnings today. These results will provide insight into the industrial sector's health and influence trading sentiment for related stocks.
🎤 Anticipated Tech Earnings: The market is keenly awaiting Q3 results from Tesla and Netflix later this week. Their performance will be a major driver for the technology sector and broader market.
📉 Credit Market Jitters: Recent bankruptcies in the auto finance and parts sectors, such as Tricolor, have caused credit market stress, leading to a charge-off for JPMorgan and raising investor concerns.
📊 Delayed Inflation Data: The crucial September Consumer Price Index (CPI) report has been delayed until October 24 due to the shutdown, creating uncertainty for Federal Reserve policy decisions.
🇺🇸 U.S.-China Trade Talks: High-level trade negotiations are set to resume in Malaysia this week between U.S. Treasury Secretary Bessent and Chinese Vice Premier He, with markets hopeful for de-escalation.
🇨🇳 China's Economic Data: China reported 4.8% GDP growth for Q3 and a strong 8.3% YoY increase in September exports, indicating economic resilience despite global trade tensions and a slowing global economy.
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