Core Viewpoint - The earnings season is commencing with significant reports from major banks and tech companies, indicating a pivotal week for stock performance [1]. Earnings Reports - Key companies reporting this week include Bank of America (BAC), Taiwan Semiconductor (TSM), JP Morgan (JPM), Wells Fargo (WFC), Citigroup (C), Morgan Stanley (MS), Goldman Sachs (GS), Johnson & Johnson (JNJ), and ASML Holdings (ASML) [1]. Implied Volatility - Prior to earnings announcements, implied volatility tends to be high due to market uncertainty, leading to increased demand for options [2]. - After earnings announcements, implied volatility typically decreases to normal levels [3]. Expected Price Movements - The expected price range for stocks can be estimated by summing the prices of at-the-money put and call options [3]. - Expected price movements for specific stocks are as follows: - Monday: FAST – 5.6% - Tuesday: C – 5.6%, GS – 5.6%, JNJ – 3.3%, JPM – 5.0%, WFC – 5.3% - Wednesday: ASML – 7.9%, BAC – 5.0%, MS – 5.1% - Thursday: IBKR – 6.5%, ISRG – 8.7%, SCHW – 5.7%, TSM – 6.8% - Friday: AXP – 5.3%, SLB – 5.5% [4]. Trading Strategies - Traders can utilize expected price movements to structure their trades, with bearish traders selling bear call spreads and bullish traders selling bull put spreads or using naked puts [5]. - Neutral traders may consider iron condors, ensuring short strikes remain outside the expected range [5]. Risk Management - It is advisable to employ risk-defined strategies and maintain small position sizes when trading options over earnings [6]. - A full loss from a trade should ideally not impact the portfolio by more than 1-3% [6]. High Implied Volatility Stocks - A stock screener can identify stocks with high implied volatility, using filters such as total call volume greater than 5,000, market cap over 40 billion, and IV rank above 60% [7].

Core Insights - The corporate buyer of Bitcoin has significantly expanded over the past year, with at least 152 public companies now holding approximately 950,000 Bitcoins valued at over $110 billion, compared to just over 416,000 Bitcoins held a year ago [2][5] - Companies are increasingly adding cryptocurrencies to their balance sheets to diversify portfolios, hedge against inflation, and attract new investors, with the unspoken goal of boosting stock prices through the announcement of "crypto treasury" strategies [3][4] - The real profits from this crypto boom are flowing to custodians, brokers, asset management firms, and investment banks that charge fees for transactions, transfers, and storage agreements [4][8] Company and Industry Summaries - Anchorage Digital has signed multiple agreements to manage significant Bitcoin reserves for various companies, indicating a peak in demand for custodial services [4][9] - MicroStrategy, now known as Strategy, leads the corporate Bitcoin holdings with approximately 628,946 Bitcoins valued at $730 billion, showcasing a premium of 25% over its market capitalization [6][11] - The trend of corporate crypto treasuries has led to substantial fundraising, with companies raising over $98 billion this year alone, and an additional $59 billion pledged since June [6][14] - Major custodians like BitGo and Coinbase are benefiting from the surge in demand for crypto treasury services, with BitGo's assets under custody expected to exceed $100 billion by mid-2025 [8][13] - Traditional investment banks such as Morgan Stanley and Barclays are capitalizing on the issuance of preferred stocks and convertible bonds, generating significant underwriting fees [8][14] - The crypto treasury trend is expected to continue growing, with companies likely to seek differentiated strategies to generate returns on their crypto assets, potentially leading to increased reliance on institutional lenders and asset management firms [14][15]

Core Insights - Morgan Stanley anticipates that the upcoming US Consumer Price Index (CPI) report for September will show core CPI remaining elevated, with overall inflation slightly above core inflation due to factors such as tariff costs and rising energy prices [1][3] - The firm predicts a month-over-month increase of 0.32% in core CPI and a year-over-year increase of 3.12%, marking the fourth consecutive month of positive core goods inflation, primarily driven by the gradual transmission of tariff-related costs to consumers [1] - The estimated contribution of tariffs to year-over-year core CPI is projected to rise to 35 basis points if the data meets expectations, approaching half of the total expected impact of tariffs [1] Inflation Performance - Overall CPI is expected to outperform core CPI, with a month-over-month increase of 0.41%, driven by a significant rebound in energy prices, which are forecasted to rise by 2.00% [3] - In contrast, food price inflation is expected to slow down, with a projected month-over-month increase of 0.19%, lower than August's 0.46% [3] Specific Categories - Core goods prices are anticipated to continue a moderate increase, despite a slowdown in the growth rates of clothing, new cars, and used cars, while other categories are expected to accelerate after an unexpected decline in August [5] - Housing rent is projected to see a slight pullback, with month-over-month growth expected to be below 0.30% [5] - Core services inflation, excluding housing, is expected to rebound to 0.40%, primarily driven by medical services, while growth in airline ticket prices and hotel rates is expected to weaken [5] Key Observations - The speed of tariff transmission is ongoing but appears to be slowing, with ISM and PMI price indicators remaining high but recently declining, reducing the likelihood of core goods month-over-month growth exceeding 0.4% [5] - Auto insurance inflation is expected to continue to slow, with year-over-year growth potentially dropping below 2% by Q1 2026 [5] - Seasonal adjustment factors for used car CPI may distort policymakers' interpretation of inflation data [5] Personal Consumption Expenditures (PCE) - Morgan Stanley forecasts a month-over-month increase of 0.30% in the core Personal Consumption Expenditures (PCE) price index, slightly above the previous month's 0.23% [5] - Financial services inflation is expected to remain high at 0.53%, reflecting strong stock market performance in July and August, while medical services inflation is projected to rise from 0.09% in August to 0.50% [5] - Core services PCE, excluding housing, is expected to see a month-over-month increase of 0.32% [5]

Market Analysis by covering: Goldman Sachs Group Inc, Morgan Stanley. Read 's Market Analysis on Investing.com ...

Core Viewpoint - The era of 10-year U.S. Treasury yields above 4% is nearing its end due to multiple macroeconomic uncertainties and challenges to previously optimistic market sentiments [1][3]. Group 1: Economic and Political Challenges - The recent escalation of domestic and foreign policy tensions in the U.S. has significantly impacted investor confidence, particularly with the ongoing government shutdown leading to potential layoffs of federal employees [1][5]. - Trade policy uncertainties are rising again, prompting investors to shift towards safe-haven assets, which is putting downward pressure on Treasury yields [2]. Group 2: Investor Sentiment and Economic Outlook - Investor optimism in the U.S. economic outlook was previously supported by five key pillars, including concerns over prolonged recession, eased financial conditions, anticipated Fed rate cuts, belief that trade policy uncertainties peaked in April, and expectations for future fiscal stimulus [4]. - However, these pillars are showing significant cracks due to the dual shocks of government shutdown and trade tensions, which have shifted the perception of economic policy uncertainty [5]. Group 3: Interest Rate Projections - Morgan Stanley believes that these external shocks are occurring near the bottom of the economic cycle, reducing the likelihood of economic rebound rather than promoting recovery [6]. - The negative impacts of tariffs are expected to manifest more in the labor market rather than in rising inflation, leading to a bearish outlook on inflation, especially at the front end of the yield curve [6]. Group 4: Investment Strategy Recommendations - Based on the macroeconomic outlook, Morgan Stanley advises investors to adjust their fixed-income strategies, noting that only 8-year, 9-year, and 10-year Treasury yields remain above 4% on the yield curve [9]. - As the risk of economic slowdown increases, these 4% yields are likely unsustainable, prompting a recommendation to increase duration in U.S. Treasuries, particularly focusing on 5-year securities [12].

October 10, 2025 11:04 PM GMT US Rates Strategy | North America A Fond Farewell to 10-Year Treasury Yields Above 4.00% The US government shutdown and escalation in trade tensions present obvious challenges to the glass-half-full view of most investors. The longer the shutdown lasts and higher trade policy uncertainty climbs, the more the glass will look half-empty. Buy US Treasuries before more 4-handles disappear. Key Takeaways Please add me to your distribution list. Downloaded by Neil.Wang@troweprice.com ...

Core Insights - Morgan Stanley is expanding access to cryptocurrency-based investments for all clients, including retirement accounts, starting October 15, 2025 [1][2] - Previously, access was limited to clients with a higher risk tolerance and assets of $1.5 million or more [2] - The firm will implement an automated monitoring process to ensure clients do not become overly concentrated in cryptocurrencies [2] Company Strategy - This move marks a significant expansion of crypto-asset access at Morgan Stanley, aligning with a more progressive U.S. government stance on cryptocurrencies [3] - The company has recently allowed trading of Bitcoin, Ethereum, and Solana through its E-Trade division [3][4] - Morgan Stanley has grown to $8.2 trillion in customer assets over the past 20 years, indicating its strong position in the wealth management industry [4] Investment Offerings - Advisors will be limited to promoting Bitcoin funds from BlackRock and Fidelity, while the firm continues to monitor the sector for potential updates [5] - The new asset class is still considered speculative, but Morgan Stanley sees value in exploring it [5]

Economic and Market Overview - The U.S.-China trade tensions continue to impact market sentiment, with President Trump downplaying the situation while China asserts it will not back down from a tariff war [5][6] - The ongoing government shutdown is expected to last over 30 days, with significant layoffs affecting federal workers, particularly in the Treasury and Health and Human Services departments [5] Earnings Reports - Major banks are set to report Q3 earnings, including JPMorgan, Goldman Sachs, Wells Fargo, BlackRock, Citigroup, Bank of America, and Morgan Stanley [5] - Analysts expect JPMorgan to report EPS of $4.87 on revenue of $45.57 billion, driven by credit card growth and investment banking momentum [5] - Goldman Sachs is forecasted to report EPS of $10.62 on revenue of $14.13 billion, with strong growth in investment banking and asset management [5] Corporate Developments - Warner Bros. Discovery has reportedly rejected an acquisition offer from Paramount Skydance, which was deemed too low at around $20 per share [5] - Paramount is considering options to enhance its bid, including raising the offer price or seeking financial backing [5] Dividend Announcements - AbbVie and Abbott Labs will go ex-dividend on Wednesday, with payout dates on November 14 and November 17, respectively [5] - Delta Air Lines will go ex-dividend on Thursday, with a payout date of November 6 [5] - Colgate-Palmolive will go ex-dividend on Friday, with a payout date of November 14 [5] Investment Insights - Analysts have highlighted vulnerabilities in companies such as SiriusXM and Bumble, citing issues like subscriber losses and shrinking margins [5] - Travelers has a cautious outlook for the commercial lines market, while T. Rowe Price is noted for its high valuation relative to its business focus [5] Brand and Retail Developments - The Jordan Brand, part of Nike, is valued at over $10 billion following a successful marketing strategy initiated in 1984 [6] - Nike has opened a new flagship store in Philadelphia as part of its U.S. expansion plan for the Jordan Brand [6]

The country's biggest Wall Street banks are riding high into the third quarter reporting season. Analysts expect profits among six major banks to climb 6% from the third quarter of last year, according to Bloomberg data. "It's been a good environment," Barclays analyst Jason Goldberg said. Expectations will be put to the test starting Tuesday morning, when JPMorgan Chase (JPM), Citigroup (C), Goldman Sachs (GS), and Wells Fargo (WFC) kick off the ritual. Bank of America (BAC) and Morgan Stanley (MS) get ...

Economic Indicators - China's September CPI is expected to show a slight improvement, with predictions ranging from -0.1% to -0.3%, compared to -0.4% in August [8][10] - The PPI is anticipated to narrow its decline to 2.4% year-on-year, following a previous decline of 2.9% in August [10] - For China's September exports, optimistic forecasts suggest a growth rate of 6.0% to 7.4%, significantly higher than August's 4.4% [11] Major Financial Events - The Oracle AI World conference is scheduled from October 13 to 16, showcasing Oracle's advancements in AI technology [13][15] - The IMF and World Bank's autumn meeting will focus on stock market bubble risks and potential economic downturns, with discussions led by global central bank leaders [16] - The Nobel Prize in Economic Sciences will be announced on October 13, with significant implications for market trends [20] Company Earnings Reports - Cambricon will release its Q3 2025 earnings report on October 17, following a remarkable revenue increase of 4347.82% year-on-year to 2.881 billion yuan [24] - Samsung Electronics is set to announce its preliminary Q3 2025 results on October 14, with expectations of operating profit exceeding 10 trillion won due to a semiconductor market recovery [26][27] - ASML's Q3 2025 earnings report is anticipated on October 15, with sales projections between 7.4 billion to 7.9 billion euros, driven by high demand for advanced EUV lithography systems [29][30] - TSMC will report its Q3 2025 earnings on October 16, with prior revenue figures indicating a 30% year-on-year increase, largely fueled by strong AI chip demand [32][34]