Stock prices slide after mixed earnings results, and AI-spending fears hit stocks, while gold price sinks to a one-year low

 

This week

Tuesday’s US midterm elections on November 3 are the week’s biggest political event and could trigger market moves as results come in over the following hours and days, and control of Congress becomes clearer. Apple reports earnings on Monday, followed by AMD on November 3. Thursday’s Bank of England decision precedes Friday’s US nonfarm payrolls report on November 6, which could help shape expectations about the Fed’s December rate decision.

 

Stocks

Applied Materials

Applied Materials share price gained 3.5%, recovering from its lowest level since April. The shares got a lift from Monday’s announcement that it plans to raise its stake in Dutch chip equipment maker Besi from around 9% to 20%. The two companies work together on advanced chip packaging, a growing part of AI chip production. Wednesday’s forecast from chip producer SK Hynix that memory shortages could last until 2030 was another potential positive. Applied Materials reports results on November 12, with analysts expecting revenue of around $10.30 billion.

SanDisk

SanDisk's price fell 12.6% to a three-month low, even after reporting better-than-expected results on Thursday. Revenue rose 23% from the previous quarter to $11.0 billion, while adjusted earnings came in at $49.51 a share. However, the shares were negatively impacted by Friday’s wider technology selloff and fell sharply by the close of business. RBC Capital Markets cut its price target from $1,600 to $1,400 but kept its hold rating. SanDisk also announced an eight-for-one stock split. Split-adjusted trading is expected to begin on November 20.

 

Commodities

Crude Oil

Crude oil price fell 0.5% overall despite touching a five-month high on Friday. Prices rebounded late in the week after more tankers were struck in the Strait of Hormuz. Washington’s renewed warning of possible military action and reports that President Trump met with top military commanders and officials added to fears that the US could opt for military action soon. However, Qatari mediators returned to Tehran on Friday, and Trump said the war might end soon, leaving traders weighing the risk of further escalation against the possibility of renewed negotiations.

Gold

Gold prices fell 3.0% to a one-year low. Rising oil prices reinforced inflation concerns and expectations of a December Fed hike, limiting bullion’s appeal despite geopolitical risks. Friday’s technology rout added another source of selling: Commerzbank said investors may have sold gold to cover losses elsewhere. Meanwhile, traders began to focus on the upcoming midterms and India’s Diwali festival on November 8, which could see an increase in safe-haven or physical demand for the precious metal.

Copper

Copper prices slipped 0.1% over the week, having touched a two-week high before giving back its gains. Buying from China helped support prices early on. Chile’s copper production also fell 15% in September from the previous year, adding to supply concerns. However, copper lost ground late in the week as investors questioned how much demand for the metal would come from AI projects. A stronger dollar also made copper more expensive for buyers using other currencies. In Mongolia, Rio Tinto began restarting underground operations at its Oyu Tolgoi mine following a seismic event that had stopped work.

GBP/USD

GBP/USD price edged up 0.1% over the week. Wednesday’s UK budget had little impact on the pound, as the government avoided measures that might have unsettled investors. Recent UK data maintained expectations that the Bank of England could raise interest rates on November 5. The dollar weakened after the Fed left US rates unchanged on Wednesday, helping the pound. However, Fed Chair Kevin Warsh made clear that future decisions would depend on incoming economic data, and markets continued to expect a possible rate rise in December. Attention now turns to the US jobs report on November 6.

 

Recap

Last week the S&P 500 fell 0.6%, the Nasdaq lost 2.0%, and the Dow Jones slipped 0.9%, as concerns about the returns from large AI investments set aside early-week gains. Gold, silver, platinum and palladium prices fell, while crude finished slightly lower despite reaching a five-month high. Alphabet’s weaker growth and Amazon’s mixed results renewed concerns over AI spending, while Microsoft also came under pressure, despite beating earnings expectations. In geopolitics, traders were on edge after Washington reiterated the possibility of renewed strikes on Iran. Reports of US evacuation instructions added to market nerves, while two tanker incidents in Hormuz reinforced concerns about oil supplies. The Fed held rates unchanged on Wednesday; Fed Chair Kevin Warsh said inflation could be brought down without unnecessarily slowing growth, but declined to outline a particular rate path.