On Thursday, all three major indexes closed higher. US President Trump stated that progress on handling the Iran issue was going smoothly, saying that Iran is ready to yield and that the US will win quite easily. He noted that a large amount of oil has already been shipped through the Strait of Hormuz, and oil prices will fall again.

US Treasury yields retreated from multi-year highs. The 10-year Treasury yield touched 5.344% during the session, the highest level since 2002. The 30-year Treasury yield also rose to a level not seen in 24 years. By late trading, yields began to pull back. The 10-year and 30-year yields fell by 5 and 3 basis points respectively. The short end of the yield curve saw even more pronounced declines, with the 2-year yield dropping 10 basis points.

US Stocks

At the close, the Dow Jones Industrial Average rose 20.75 points, or 0.04%, to 50,926.80; the S&P 500 gained 15.12 points, or 0.20%, to 7,666.66; and the Nasdaq Composite added 10.53 points, or 0.04%, to 26,871.60. Accenture (ACN.US) surged 15.99%, SK Hynix (SKHY.US) rose 5.08%, SanDisk (SNDK.US) gained 2.75%, IBM (IBM.US) climbed 2.63%, and Micron Technology (MU.US) advanced 3.03%. Broadcom (AVGO.US) fell 2.15%, and Google (GOOG.US) dropped 1.7%. The Nasdaq Golden Dragon China Index declined 1.03%, with NetEase (NTES.US) down 0.45% and Alibaba (BABA.US) down 0.09%.

European Stocks

Germany's DAX 30 fell 260.07 points, or 1.03%, to 24,939.12; the UK's FTSE 100 dropped 183.64 points, or 1.73%, to 10,422.36; France's CAC 40 declined 129.20 points, or 1.62%, to 7,835.31; the Euro Stoxx 50 fell 97.47 points, or 1.55%, to 6,171.55; Spain's IBEX 35 dropped 442.06 points, or 2.28%, to 18,984.14; and Italy's FTSE MIB declined 1,153.48 points, or 2.25%, to 50,218.50.

Asia-Pacific Stocks

Japan's Nikkei 225 rose 3.3%, South Korea's KOSPI gained 1.95%, and Indonesia's Composite Index fell 1.02%.

Forex

The US Dollar Index, which measures the greenback against six major currencies, rose 0.64% on the day to close at 102.102. At the New York close, the euro traded at 1.1235 per dollar, down from 1.1332 the previous session; the British pound was at 1.3190, down from 1.3262; the dollar was at 158.11 Japanese yen, up from 157.34; the dollar was at 0.8317 Swiss franc, down from 0.8354; the dollar was at 1.4236 Canadian dollars, up from 1.4229; and the dollar was at 10.0597 Swedish krona, up from 10.0103.

Cryptocurrencies

Bitcoin briefly broke above $85,000 and was last at $84,718; Ethereum rose 0.49% to $2,699.

Precious Metals

Spot gold was at $4,176.96 per ounce; spot silver was at $60.98 per ounce.

Crude Oil

Light crude futures for November delivery on the New York Mercantile Exchange rose $2.45 to settle at $92.87 per barrel, up 2.71%; London Brent crude futures for December delivery rose $4.28 to settle at $102.31 per barrel, up 4.37%.

Macro News

Fed Vice Chair Jefferson: More time may be needed to determine whether to raise rates further. Federal Reserve Vice Chair Philip Jefferson said inflation has been too high for too long and risks of it remaining elevated persist, but policymakers may need more time to judge whether further rate hikes are necessary. Any future policy adjustments should carefully assess data trends, changes in the economic outlook, and the balance of risks. Jefferson noted that US economic activity and the labor market remain solid, but multiple shocks including rising energy prices, the AI investment boom, and tariffs are affecting the economy, and these factors cannot be viewed in isolation when making policy. He also said that since the September meeting, Treasury yields across maturities have risen further, indicating investors are reassessing the macroeconomic situation; as more data emerges, the Fed will continue to judge whether inflation can return to target quickly enough and what monetary policy stance is most appropriate.

Kashkari: Fed expected to hike again, but unsure about October. Minneapolis Fed President Neel Kashkari said he expects the Fed will need to raise rates further to restrain the economy and inflation, but he has no strong view on whether it should act at the October meeting. His previous forecast was for another 25 basis point hike this year and one more in 2027, but since the September meeting the US economy has performed stronger than he expected while inflation remains too high; if the economy continues to be exceptionally strong and inflation proves more stubborn than expected, rates may need to rise to a higher level than currently anticipated. Kashkari believes the labor market is healthy and the economy is performing well, suggesting monetary policy "may not be particularly restrictive." He also said recent market volatility has not yet posed systemic risks, and the Treasury market has been able to digest the repricing of rates normally.

US initial jobless claims fall to lowest since July; continuing claims drop to a three-year low. US initial jobless claims edged down to their lowest level since July, while continuing claims fell to a three-year low, indicating the labor market remains healthy. Continuing claims decreased by 11,000 to 1.7 million, the lowest since March 2023. In recent months, initial claims have hovered near historic lows, suggesting businesses are reluctant to cut staff amid solid economic activity. Meanwhile, hiring has become more cautious. The government's nonfarm payrolls report due Friday is expected to show the unemployment rate held at 4.1% in September. The four-week moving average of initial claims fell to 200,000, a seven-week low. Without seasonal adjustments, initial claims declined in most states including Hawaii, Georgia, and Texas.

US 30-year mortgage rate rises to 7.28%, highest in nearly three years. Freddie Mac data showed the average rate on a 30-year fixed mortgage rose to 7.28% this week from 7.03% the prior week, the sixth consecutive weekly increase and the highest since November 2023, compared with 6.34% a year earlier; the 15-year fixed mortgage rate also rose to 6.60% from 6.42%. In late February, the 30-year mortgage rate had fallen to 5.98%, and has since risen about 1.3 percentage points, adding roughly $276 to monthly payments on a $400,000 loan. According to the Associated Press, inflation expectations driven by surging oil prices have pushed US Treasury yields higher, with the 10-year yield rising from 3.97% in late February to 5.27% during Thursday's session, further driving up mortgage costs. High rates continue to weigh on the US housing market, with August existing home sales falling 2% month-over-month to a seasonally adjusted annual rate of 3.98 million, the lowest in more than a year.

US manufacturing continues to expand in September; PMI hits a more than three-year high. Chris Williamson, chief business economist at S&P Global Market Intelligence, said: "The pace of US manufacturing growth accelerated again in September, with the PMI at its highest level since May 2022, as surging new orders prompted factories to sharply increase output and boost hiring. Backlogs continued to build and suppliers became increasingly busy, indicating capacity is tightening and firms are struggling to meet demand from both consumer and business sectors. This was especially true for investment and production of machinery and equipment, which in many cases is linked to growing AI-related spending. Although the continued decline in export orders is disappointing, increased safety stockpiling due to concerns about prices and supply chains continues to support demand. While this sends an encouraging signal for further growth in manufacturing capacity in the coming months, signs that demand is outpacing supply also mean inflationary pressures remain a key concern, especially with oil prices elevated. Faster economic growth, increased hiring, and rising price indicators will reinforce market speculation that the Fed is about to raise rates further."

Individual Stock News

Nvidia and SoftBank reportedly complete final $20 billion investment in OpenAI. According to media reports citing people familiar with the matter and a SoftBank statement, Nvidia (NVDA.US) and SoftBank have each completed the final $10 billion investment in OpenAI's previous funding round, fulfilling their respective $30 billion commitments. OpenAI disclosed in March that the round secured $122 billion in investment commitments at a post-money valuation of $852 billion; Amazon (AMZN.US) had previously committed up to $50 billion and completed its full investment in July. With the previous round completed, OpenAI may be paving the way for its next private fundraising round, targeting about $30 billion at a valuation that could reach roughly $1.4 trillion. SoftBank said that after completing the latest investment, its cumulative investment in OpenAI reached $64.6 billion, representing about a 13% stake; the final investment was partly funded by SoftBank's $11.1 billion high-yield bond issuance completed at the end of September.

TSMC (TSM.US) considers building a new campus in Texas to produce more AI chips. TSMC is considering building a new campus in Texas, which would add tens of billions of dollars in new investment to its multi-year US chip manufacturing expansion plan. People familiar with the matter said TSMC is studying further overseas facilities to meet unabated demand for AI hardware. Year to date, North America has accounted for more than 75% of TSMC's wafer revenue, with AI chip designers such as Nvidia and AMD bringing in huge orders for some of its most advanced technologies. TSMC Deputy Co-COO Kevin Zhang said last month that the AI boom has already strained TSMC's existing capacity. People familiar with the matter said that if TSMC ultimately decides to invest in Texas, the project would include multiple chip fabrication plants, each costing at least $20 billion. However, these plans are still at an early stage. The potential Texas investment also depends on whether US lawmakers extend an advanced manufacturing tax credit set to expire at the end of this year.

Broadcom (AVGO.US) to provide up to $42 billion in loans to Anthropic for leasing its chips. Anthropic's IPO prospectus shows the company has established extensive partnerships with a handful of large tech companies. One stands out in particular: Broadcom. Its collaboration with Anthropic covers computing power supply, equipment leasing, and financing. As part of this complex partnership, the IPO filing revealed that Broadcom has agreed to provide up to $42 billion in loans to Anthropic to finance infrastructure spending. In turn, Anthropic is expected to become Broadcom's largest customer for its core chip design business next year, a spending pattern that has been a focus of AI skeptics on Wall Street. As part of the financing arrangement, Broadcom can designate a financing partner, and these debt instruments may convert into Anthropic shares. Anthropic disclosed that Broadcom's dual role as both hardware supplier and financing partner creates "potential conflicts of interest" that could affect Anthropic's access to the computing power it needs for its work.