General Market News

The Dow Jones Industrial Average's recent pullback is approaching a key support level near 50,500, where technical analysis suggests the decline may be nearing exhaustion. Elliott Wave analysis indicates the fifth wave of a corrective decline is nearly complete, while extremely oversold market breadth signals a potential rally ahead. The analysis suggests downside risk is limited while upside potential has increased significantly.

• The DJIA is targeting the 50,250-750 range to complete a five-wave Elliott Wave decline, with support at the February high around 50,500 and Fibonacci extension at 50,484
• The NYSE McClellan Summation Index (NYSI) reached -665 with RSI5 at 1.78, levels seen only five times in 28 years and typically associated with major market bottoms or deep corrections
• Market breadth has been extremely oversold since mid-August while major indexes are down only 5-7%, suggesting the market is correcting internally rather than through price, indicating a new rally may be imminent

ASE Technology Holding (ASX) is expanding its advanced semiconductor packaging capabilities, particularly CoWoS and panel-level packaging, to meet surging AI-driven demand for complex chip integration. The company expects 35% ATM revenue growth in 2026 and plans to double LEAP revenues in 2027, with a new automated panel packaging line starting production in Q1 2027. The Zacks consensus estimates project 27.9% revenue growth in 2026 and 22.5% in 2027.

• ASX's CoWoS capacity expansion and full process business are on track to generate approximately TWD 300 million in 2026 revenues, with substantial growth expected in 2027
• The company's fully-automated 310-by-310 panel packaging line will begin production in Q1 2027, offering a complementary solution to foundry offerings for AI infrastructure customers
• ASX currently trades at a forward P/E of 24.45X (above industry average of 13.61X) and holds a Zacks Rank #1 (Strong Buy), competing against Amkor Technology and Intel in advanced packaging

The Federal Reserve's preferred inflation measure, core PCE, rose 0.2% monthly and 3% annually in August, coming in below expectations of 0.3% and 3.3% respectively. The cooler-than-expected reading likely pushes the next rate hike to December rather than October, with traders now pricing in only 37% odds of an October increase. Despite the improvement, inflation remains well above the Fed's 2% target while economic growth and employment data show continued resilience.

• Core PCE rose 3% annually versus expectations of 3.3%, with overall PCE at 3.4% versus estimated 3.7%; methodology changes for measuring legal services and software prices may have contributed to the lower reading
• Energy costs drove much of August's price increase, with gasoline jumping 4.4% due to Middle East supply disruptions keeping prices above $4 per gallon
• Markets responded positively with the S&P 500 up 0.7% and Nasdaq up 1.1%, while odds of an October rate hike dropped from 45% to 37% as traders now expect December action

Senate Republicans plan Wednesday votes on two bills before a month-long election recess: one addressing data center utility costs and another restricting congressional stock trading. Neither bill is expected to pass the 60-vote threshold as Democrats oppose both measures, calling them inadequate messaging bills designed to provide Republicans political wins ahead of midterm elections.

• The data center bill, which passed the House 417-3, would create an optional state framework requiring AI data centers to cover their own energy costs rather than pass them to customers; Democrats call it 'toothless' because adoption is voluntary
• The Stop Insider Trading Act passed the House 232-198 and would ban members from buying individual stocks but would not require divestment of existing holdings, which Democrats say is insufficient
• Republicans added a controversial voter ID provision to the stock trading bill that Democrats oppose, with Minority Leader Schumer calling it a 'poison pill' and criticizing both bills as 'theatrical' political messaging

Record AI infrastructure spending by major tech companies is transforming investor focus toward quality metrics like free cash flow, as AI capital expenditures have pushed some hyperscalers' free cash flow negative for the first time. The buildout is projected to exceed major historical U.S. economic transformations including railroads and electrification. Rising bond yields near 5% and increased corporate debt costs are driving investors toward companies with stronger balance sheets and sustainable cash generation.

• Aggregate AI capex by major tech firms exceeded operating cash flow in Q2 2026, turning free cash flow negative despite companies remaining 'extraordinarily profitable,' according to Raymond James analysis
• Construction spending on AI data centers increased $51 billion since December 2023, while private construction spending on everything else declined $120 billion, per U.S. Census Bureau data
• Quality-focused ETFs like QUAL and JQUA are seeing strong inflows ($308M and $300M monthly respectively), with holdings still dominated by Mag 7 stocks valued for diversified cash-generating legacy businesses beyond AI investments

President Donald Trump is set to announce approximately $200 billion in South Korean investments in U.S. energy projects, including nuclear power plants and natural gas facilities. The investments are part of South Korea's larger $350 billion strategic investment package, with about $54 billion reportedly earmarked for a liquefied natural gas facility in Alaska and other projects. The announcement represents a significant bilateral economic commitment in the energy sector.

• South Korean investments totaling $200 billion will target energy infrastructure including nuclear power plants, power generation facilities, and natural gas export ventures across the United States
• Approximately $54 billion of the broader $350 billion South Korean strategic investment package is designated for a liquefied natural gas facility in Alaska
• The announcement was reported by Bloomberg News citing White House officials, though Reuters could not immediately verify the details

AI-related debt issuance in the US leveraged finance market surged to $88 billion in 2026, up from $20 billion in the first 11 months of 2025, but investors are demanding higher compensation from riskier AI borrowers whose future earnings remain unproven. Lenders are scrutinizing revenue projections, collateral quality, and debt sustainability more closely, particularly for lower-rated issuers seeking capital for AI infrastructure buildouts. The market favors near investment-grade borrowers with predictable cash flows, while riskier AI companies face borrowing costs as high as 14-15%.

• AI infrastructure supply in high-yield debt reached $40 billion in 2026 versus $12 billion for all of 2025, with demand concentrated in double-B-rated (near investment grade) issuers rather than lower-rated borrowers.
• Even BB+ rated AI issuers like SoftBank are paying 8.625-9.75% yields on bonds, with lower-rated borrowers facing potential costs of 14-15%, reflecting investor concerns about asymmetric risk-return profiles in AI debt.
• Zenith Arc's $1 billion bond offering in August initially dropped nearly seven points below issue price, illustrating market skepticism toward AI borrowers that require heavy upfront investment before generating reliable cash flow.

President Trump's 'Section 301' tariffs covering 99.4% of U.S. imports from 86 countries face a third legal challenge in federal trade court. The lawsuits argue the administration is illegally attempting to reimpose worldwide tariffs previously struck down by the Supreme Court, which forced over $100 billion in refunds. A three-judge panel in New York is hearing arguments from small businesses and Democratic-led states contesting the 10-12.5% duties imposed in July 2026.

• The Supreme Court struck down Trump's 'reciprocal' tariffs in February, invalidating a major piece of his trade agenda and requiring refunds exceeding $100 billion
• The new Section 301 tariffs apply 10% or 12.5% rates to goods from 86 countries and officially cite forced-labor enforcement failures as justification
• Trump publicly stated in July that the Section 301 tariffs are 'exactly the same' as those previously invalidated, potentially strengthening the plaintiffs' case that they are an unlawful workaround

President Trump is expected to announce that South Korea will invest approximately $54 billion in an Alaska liquefied natural gas facility and other U.S. projects. The announcement comes ahead of November midterm elections and aims to bolster Trump's economic record amid voter concerns over inflation and gas prices, while also supporting Republicans in Alaska's closely watched Senate race.

• The $54 billion investment stems from a trade agreement between Washington and Seoul reached last year, with funds directed toward Alaska LNG and other projects including nuclear power and a Texas gas-fired power plant
• The Alaska LNG project would build a pipeline from the North Slope to a southern coast liquefaction facility for exports to Asian markets, but has faced years of uncertainty over cost, financing, and commercial viability
• South Korean opposition lawmakers have raised concerns about commercial viability and fiscal risks, with parliament's trade committee pledging to closely examine profitability before approving investments that burden the public

Private sector employers added 90,000 jobs in September, exceeding economist expectations of 70,000, according to ADP's National Employment report released Wednesday. The figure represents a significant rebound from August's revised 36,000 payrolls, signaling renewed strength in the labor market after a three-month slowdown.

• Job gains of 90,000 surpassed the consensus forecast of 70,000 new positions
• September's figure marks a sharp increase from the prior month's revised total of 36,000 jobs
• ADP's chief economist characterized the report as 'strong,' noting that pay growth remained solid alongside the rebound in job creation

The Federal Reserve's preferred inflation measure, the PCE index, showed cooling but elevated price pressures in August 2026. The headline PCE rose 3.4% year-over-year and core PCE increased 3% annually, both coming in below economist expectations but still above the Fed's target. This data provides insights into ongoing inflation challenges facing consumers and monetary policy considerations.

• Headline PCE rose 0.3% monthly and 3.4% annually, below expectations of 0.4% and 3.7% respectively
• Core PCE (excluding food and energy) increased 0.2% monthly and 3% year-over-year, both cooler than the 0.3% and 3.3% forecasts
• Inflation remains elevated above the Fed's target despite the cooling trend, indicating continued price pressures on consumers

The U.S. economy grew at an annualized rate of 2.2% in the second quarter according to the Commerce Department's final reading, exceeding economist expectations. The Bureau of Economic Analysis released the GDP data for the April-June period, showing stronger growth than the 1.5% that economists had forecasted.

• Second quarter GDP growth came in at 2.2% annualized, beating the 1.5% consensus estimate from economists polled by LSEG
• The report represents the final reading from the Bureau of Economic Analysis for the three-month period covering April, May, and June
• Treasury Secretary Scott Bessent has predicted further economic acceleration, with some GDP growth estimates reaching as high as 5%

The Federal Reserve's preferred inflation measure, the personal consumption expenditures (PCE) price index, showed core inflation at 3.0% annually in August, significantly below the 3.3% consensus forecast. Headline PCE also came in lighter than the expected 3.7%. This surprisingly low inflation reading is important for the Fed's monetary policy decisions and suggests cooling price pressures in the economy.

• Core PCE inflation registered at 3.0% year-over-year in August, undershooting the Dow Jones consensus estimate of 3.3%
• Headline PCE inflation also came in below expectations of 3.7%, indicating broader easing of price pressures
• The lower-than-expected readings may influence the Fed's interest rate policy decisions and signal progress in the fight against inflation

Private sector employment increased by 90,000 jobs in September, exceeding the expected 68,000 and rebounding from August's downwardly revised 36,000, according to ADP's Wednesday report. The report indicates stabilization in the U.S. labor market after a three-month slowdown, with balanced growth across service providers and goods producers.

• Education and health services led job creation with 55,000 new hires, while financial activities (-16,000) and professional and business services (-11,000) reported losses
• Annual base pay rose 3.2% year-over-year while gross pay accelerated 4.7%, indicating solid wage growth alongside employment gains
• The report precedes Friday's official BLS nonfarm payrolls data, which economists expect to show 84,000 jobs added with unemployment holding at 4.1%

Holiday retail sales are projected to exceed $1 trillion for the first time this year, representing 4.5% growth according to Bain & Company. However, most of this growth is driven by inflation rather than increased unit sales, prompting consumers to become more value-conscious and discount-seeking in their shopping behavior.

• Savings accounts are up $43 billion (17% year-over-year), but roughly half has already been consumed by higher living costs, squeezing consumer budgets
• Categories most affected by inflation with declining unit sales include food and beverage, furniture, and health and personal care products
• AI adoption in holiday shopping is growing rapidly, with 29% of consumers planning to use AI tools (up from 22% last year), primarily for product research (75%) and price comparison (55%) rather than direct purchases

Mortgage rates climbed for the sixth consecutive week to 7.30% for 30-year fixed-rate loans, the highest level since November 2023, causing total mortgage demand to fall 6% to a two-year low. Rates surged even higher to 7.58% by Tuesday. Both refinance activity and home purchase applications declined sharply as borrowers face the dual challenge of elevated rates and accelerating home price growth.

• Refinance applications dropped 9% for the week and are down 56% year-over-year, as few borrowers can benefit from refinancing at current rates
• Purchase mortgage applications fell 4% weekly and are 14% lower than a year ago, while home prices nationally accelerated to 1.9% annual growth in July from 1.6% in June
• Adjustable-rate mortgages (ARMs) now account for 10.3% of applications, the highest share in over two years, as borrowers seek rates roughly 80 basis points lower than fixed-rate loans

Future's shares dropped 12% after the company paused the remaining £6 million of its £30 million share buyback programme to prioritise debt reduction. Despite the decline, Peel Hunt maintained its 'buy' rating and 535p price target, describing the trading update as 'light but comforting' and supporting the deleveraging focus.

• Second-half trading progressed as expected with 2026 consensus forecasts of £707 million revenue and £180 million adjusted EBITDA
• £24 million of the £30 million buyback completed before pausing the final £6 million to focus on deleveraging in FY2027
• Peel Hunt forecasts 2027 net debt of around £305 million and expects leverage to fall below one times earnings by 2028, supported by strong cash generation

As the third quarter ends, Treasury yields hit their highest since 2002 while US consumer confidence plunged to its lowest since 2014, raising doubts about the October interest rate outlook. The 10-year Treasury yield jumped 82 basis points in Q3, the largest quarterly increase in four years. New York Fed President John Williams suggested the Fed may delay further rate hikes to gather more data, despite market pricing favoring another October increase.

• 10-year Treasury yields surged 82 basis points in Q3, the biggest quarterly jump in four years, with long bond yields reaching 2002 highs
• US consumer confidence dropped to its lowest level since 2014 in September, while August job openings also declined despite stable layoff readings
• NY Fed's Williams cast doubt on October rate hike timing, saying the Fed may need more time to assess data before tightening further, despite market odds favoring another increase

The U.S. Securities and Exchange Commission is proposing rules on Wednesday to expand retail investor access to private assets like private equity, venture capital, and real estate, which traditionally have been limited to wealthy professionals. The proposals are part of the Trump administration's effort to 'democratize' private markets, though critics warn this could expose everyday Americans to higher fees and risks they may not fully understand.

• The SEC will propose easing performance-fee rules to allow asset managers more freedom to charge retail clients based on capital gains, potentially creating incentives to expose clients to greater risk
• Changes to closed-end fund redemption rules are also proposed, and the commission will consider designating certain certifications and credentials as qualifying investors for accredited investor status
• The three-member SEC currently has no Democratic commissioners, and critics argue the measures primarily benefit Wall Street at the expense of retail investors who may not understand the illiquidity and pricing challenges of private assets

Oil prices rose early Wednesday after President Trump denied reports he offered Iran sanctions relief in exchange for nuclear concessions. Qatar continues mediating between the U.S. and Iran, with Iran's foreign minister receiving U.S. feedback on a seven-day plan to reopen the Strait of Hormuz.

• Brent crude climbed 0.49% to $103.09 per barrel while WTI rose 0.18% to $89.53 per barrel following Trump's denial of the Axios report
• Iran's foreign minister Abbas Araqchi met with Qatari mediators in Doha to discuss U.S. feedback on Iran's proposal to unlock the Strait of Hormuz
• Qatar continues exchanging messages between Washington and Tehran, working to establish common ground for a deal to avoid broader conflict repercussions