Group 1: Report Industry Investment Rating - No information provided Group 2: Core Viewpoints of the Report - On November 7, concerns about the slowdown of economic growth boosted the precious metal prices, and the continuous increase of China's gold reserves by the central bank supported the gold price. However, due to the Senate Democrats' proposal to extend the AIA subsidy and the Fed officials' cautious attitude towards December interest - rate cuts, the upward momentum of precious metal prices was limited. It is expected that the short - term precious metal prices will maintain a range - bound oscillation, but there is still upward space in the long term. Long - term investors are advised to allocate on dips [3][4]. - In the medium - to - long - term, the Fed is still in an interest - rate cut cycle. Global geopolitical uncertainties, unsustainable US debt, and intensified great - power competition will increase the credit risk of the US dollar. Global central banks' gold purchases continue, so the medium - to - long - term center of gold prices is likely to move up [3][4]. Group 3: Summary by Relevant Catalogs 1. Price Tracking of Domestic and Foreign Gold and Silver (15 - point prices) - On November 7, 2025, compared with November 6, London gold spot rose 0.3% to $4007.42/ounce, London silver spot rose 0.7% to $48.71/ounce, COMEX gold rose 0.2% to $4015.20/ounce, COMEX silver rose 0.6% to $48.51/ounce, AU2512 rose 0.4% to 921.26 yuan/gram, AG2512 rose 0.5% to 11484 yuan/kilogram, AU (T + D) rose 0.3% to 918 yuan/gram, and AG (T + D) rose 0.6% to 11481 yuan/kilogram [3][4]. 2. Spread/Ratio Price Tracking (15 - point prices) - On November 7, 2025, compared with November 6, the spread of gold TD - SHFE active price changed by 41.7%, the spread of silver TD - SHFE active price changed by - 84.2%, the spread of gold domestic - foreign (TD - London) changed by 7.9%, the spread of silver domestic - foreign (TD - London) changed by 1.3%, the SHFE gold - silver main ratio changed by - 0.1%, the COMEX gold - silver main ratio changed by - 0.4%, AU2602 - 2512 changed by 7.6%, and AG2602 - 2512 changed by - 8.0% [3][4]. 3. Position Data - On November 7, 2025, compared with November 6, the gold ETF - SPDR was 1042.06 tons with a 0.16% increase, the silver ETF - SLV was 15088.6327 tons with a - 0.17% decrease. COMEX gold non - commercial long positions increased 1.85%, non - commercial short positions increased 9.43%, non - commercial net long positions increased 0.13%. COMEX silver non - commercial long positions increased 0.97%, non - commercial short positions decreased 0.21%, non - commercial net long positions increased 1.43% [3][4]. 4. Inventory Data - On November 7, 2025, compared with November 6, SHFE gold inventory increased 2.05% to 89616 kilograms, SHFE silver inventory decreased 2.64% to 623052 kilograms. COMEX gold inventory decreased 0.31% to 37729455 troy ounces, COMEX silver inventory decreased 0.28% to 480115942 troy ounces [3][4]. 5. Interest Rate/Exchange Rate/Stock Market - On November 7, 2025, compared with November 6, the US dollar/Chinese yuan central parity rate decreased - 0.04% to 7.08, the US dollar index decreased - 0.15% to 99.55, the 2 - year US Treasury yield decreased - 0.56% to 3.55%, the 10 - year US Treasury yield remained unchanged at 4.11%, the VIX decreased - 2.15% to 19.08, the S&P 500 increased 0.13% to 6728.80, and NYMEX crude oil increased 0.52% to 59.84 [3][4].

Skip to Main Content Skip to Search Nov 07, 2025, 7:47 am EST Share Resize Reprints In this article SPX PLTR QCOM AMD U.S. stock markets have been missing a key component that could reverse this week's worrying selloff heading into the start of Friday's trading session, but investors still seem to believe in the record-setting rally picking up steam over the final stretch of the year. Continue reading this article with a Barron's subscription SUBSCRIBE NOW Topics This copy is for your personal, non-commerci ...

Economic Indicators - The dollar index (DXY00) decreased by -0.30% today, influenced by a significant rise in US job cuts, which surged +175% year-over-year in October, marking the largest increase in 22 years [1][2] - Year-to-date job cuts in the US have surpassed 1 million, the highest since the pandemic, with employers announcing the fewest hiring plans since 2011 [2] Federal Reserve Outlook - The ongoing US government shutdown is exerting pressure on the dollar, with expectations that prolonged shutdowns could lead to further interest rate cuts by the Federal Reserve [1] - Market sentiment indicates a 69% probability that the Federal Open Market Committee (FOMC) will reduce the fed funds target range by 25 basis points at the upcoming meeting on December 9-10 [3] Eurozone Economic Performance - The euro (EUR/USD) increased by +0.35% today, supported by dollar weakness and positive comments from ECB Vice President Guindos regarding Eurozone growth [4] - Eurozone retail sales unexpectedly fell -0.1% month-over-month in September, contrary to expectations of a +0.2% increase, while German industrial production rose +1.3% month-over-month, below the anticipated +3.0% [5] Central Bank Divergence - The divergence in central bank policies is favorable for the euro, as the European Central Bank (ECB) is perceived to be nearing the end of its rate-cutting cycle, while the Fed is expected to implement several more rate cuts by the end of 2026 [5] - ECB Vice President Guindos expressed optimism about the European economy's resilience and noted positive trends in inflation, particularly in service prices [6]

Rates have already come down once this year, but with another Fed meeting on the horizon portending a further potential cut, investors may be looking at their options. That shifting rate environment p... ...

Core Insights - The ADP jobs report indicates a gain of 42,000 private-sector jobs for October, surpassing forecasts of 25,000, while September's report was revised to show a loss of 29,000 jobs from an initial estimate of -32,000 [3] - The S&P 500 futures remained relatively unchanged following the jobs data, with Advanced Micro Devices (AMD) experiencing a modest decline after its earnings report [1][6] - Federal Reserve Chairman Jerome Powell's comments suggest that a December rate cut is uncertain, with the odds of a cut dropping to 70% from 85% after the ADP report [2][4] ADP Jobs Report - The ADP report's gain of 42,000 jobs is significant as it reflects a return to modest job growth amidst a government shutdown that has affected the Bureau of Labor Statistics' reporting [3] - The report's implications extend to the Federal Reserve's monetary policy, as Powell noted that the break-even monthly employment gain has decreased to less than 50,000 due to a slowdown in immigration [4][5] Federal Reserve Rate-Cut Outlook - Following the ADP jobs report, the likelihood of a Federal Reserve rate cut on December 10 has decreased to 70%, indicating a shift in market expectations [4] - Powell highlighted the trend of layoffs and reduced hiring among large companies due to AI productivity gains, suggesting that as long as inflation remains controlled, the Fed may lower rates further [5] S&P 500 Market Reaction - The S&P 500 futures were flat in early trading after a 1.2% decline on Tuesday, leaving the index 1.7% below its all-time closing high from October 28 [6] - The market's reaction to the jobs data and AMD's earnings report reflects broader investor sentiment and uncertainty regarding economic conditions [1][6]

Core Viewpoint - March U.S. Treasury note futures are presenting a selling opportunity due to ongoing price weakness and bearish technical indicators [1][2]. Technical Analysis - Prices of March U.S. Treasury note futures are trending down, with a minor bear flag pattern observed on the daily bar chart [2]. - The MACD indicator is in a bearish posture, indicating that the bears hold a near-term technical advantage [2]. - A move below the last week's low of 112.14 would signal a selling opportunity, with a downside price objective of 111.00 or lower [4]. Fundamental Analysis - The recent Federal Reserve FOMC meeting adopted a hawkish stance on U.S. monetary policy, with Fed Chair Jerome Powell suggesting that interest rates may not decrease further after a 0.25% cut [3]. - U.S. inflation is described as "sticky" and remains above the Fed's target, contributing to bearish sentiment for U.S. Treasury prices [3].

Summary of Key Points from the Conference Call Industry Overview - The discussion primarily revolves around the **U.S. economy**, focusing on **AI spending**, **corporate credit**, and **delinquency rates** in the context of macroeconomic conditions. Core Insights and Arguments 1. **Federal Reserve Rate Cuts** - The expectation is for two consecutive rate cuts by the Federal Reserve until January 2026, despite a lack of data due to the ongoing government shutdown [8][9][10] 2. **Delinquency Rates** - Concerns about rising delinquencies are currently unfounded; prime credit remains stable or improving in 2025, while subprime credit is showing incremental stress [10][11][12] 3. **Corporate Credit Health** - Aggregate fundamentals in corporate credit appear strong, with a backdrop of supportive fiscal, monetary, and regulatory policies. However, there is a noted bifurcation in credit quality [13][14][16] 4. **Chinese Equities Investment Timing** - It is not yet time to buy the dip in Chinese equities due to geopolitical developments, weak consumption, and a slowing housing market. A valuation derating of 10-15% in MSCI China is anticipated before considering investments [17][18][19] 5. **AI Spending and GDP Growth** - AI spending is not the primary driver of U.S. GDP growth. After accounting for imports, AI contributed only 0.3 percentage points to the 1.6% annualized GDP growth in the first half of 2025. Future contributions from AI spending are expected to be more subdued [21][24][26] Additional Important Insights - **Labor Market Data** - Private labor market data remains weak, indicating potential challenges ahead for employment and economic stability [9] - **Credit Quality Trends** - Prime delinquencies are improving, while subprime delinquencies are on the rise, particularly affecting low- to middle-income borrowers [10][12] - **Corporate Debt Trends** - U.S. corporate debt as a percentage of GDP has been declining since 2020, suggesting a healthier corporate credit environment [14][15] - **Market Sentiment** - Investor sentiment is currently cautious, particularly regarding Chinese equities, as they await clearer signals on corporate fundamentals [17] This summary encapsulates the key discussions and insights from the conference call, highlighting the current economic landscape and investment considerations.

Industry Overview - The telecom sector has shown strong performance, with the S&P Telecom Select Industry Index increasing by 50.85% over the past year, significantly outperforming the S&P 500's 17.35% gain [1] - The index has also outperformed the broad market index month to date, rising by 9.52% compared to the S&P 500's 2% gain [1] - The sector's positive outlook is bolstered by optimistic AI growth forecasts and anticipated Federal Reserve rate cuts in 2025 [2] Verizon Communications - Verizon reported third-quarter 2025 results with wireless service revenues of $21 billion, reflecting a year-over-year increase of 2.1% [3] - On a GAAP basis, net income was $5.06 billion or $1.17 per share, up from $3.41 billion or 78 cents per share in the prior-year quarter, driven by top-line growth and lower operating expenses [4] - Total operating revenues increased by 1.5% to $33.82 billion, although it missed the consensus estimate of $34.18 billion [5] - Verizon achieved 261,000 net additions in fixed wireless access, growing its subscriber base to nearly 5.4 million, with a target of 8 to 9 million subscribers by 2028 [5] - The company expects wireless service revenues to grow by 2%-2.8% in 2025 [6] AT&T - AT&T reported third-quarter 2025 results with strong mobility and broadband demand trends, but both adjusted earnings and revenues fell short of the Zacks Consensus Estimate [7] - On a GAAP basis, net income was $9.28 billion or $1.29 per share, a significant improvement from a net loss of $0.23 billion or a loss of 3 cents per share in the prior-year quarter, largely due to a $5.5 billion gain from the sale of DIRECTV investments [8] - Adjusted earnings remained flat at 54 cents per share, missing the consensus estimate by a penny [9] - Quarterly GAAP operating revenues increased by 1.6% year over year to $30.71 billion, but also missed the consensus mark of $30.96 billion [9] - AT&T recorded 328,000 post-paid net additions, including 405,000 postpaid wireless phone additions [9] - The company aims to enhance operational efficiencies while focusing on 5G and fiber-based connectivity, along with expanding software-based entertainment platforms [10] - For 2025, AT&T expects wireless service revenues to improve by 3% or more, with broadband revenues anticipated to grow in the mid to high-teens [11] ETFs in Focus - Several exchange-traded funds (ETFs) provide exposure to the U.S. telecom industry, including: - Communication Services Select Sector SPDR Fund with 4.13% exposure to AT&T and 4.2% to Verizon [13] - Vanguard Communication Services ETF with 4.12% exposure to AT&T and 3.85% to Verizon [14] - Fidelity MSCI Communication Services Index ETF with 4.13% exposure to AT&T and 3.82% to Verizon [15] - iShares Global Comm Services ETF with 3.62% exposure to AT&T and 3.37% to Verizon [16] - iShares U.S. Telecommunications ETF with approximately 11.59% exposure to AT&T and 11.11% to Verizon [17]

Group 1: Dollar Index and Economic Indicators - The dollar index (DXY00) reached a 2.75-month high, finishing up by +0.29% due to higher T-note yields and hawkish comments from Fed Chair Powell regarding interest rates [1] - The markets are pricing in a 72% chance of a 25 basis point cut in the fed funds target range at the upcoming FOMC meeting on December 9-10, with an overall expected rate cut of 82 basis points by the end of 2026 [3] Group 2: US-China Trade Relations - Easing US-Chinese trade tensions are seen as supportive for economic growth, following an agreement between President Trump and President Xi Jinping to extend a tariff truce and reduce trade barriers [1] Group 3: Eurozone Economic Performance - The euro fell to a 2-week low, down by -0.32%, influenced by the dollar's strength, but recovered after the ECB maintained interest rates and positive economic data emerged [4] - Eurozone Q3 GDP increased by +0.2% quarter-on-quarter and +1.3% year-on-year, surpassing expectations, while the economic sentiment indicator rose to a 2.5-year high of 96.8 [5] - German October CPI rose by +0.3% month-on-month and +2.3% year-on-year, exceeding expectations [6]

Core Viewpoint - The iShares Biotechnology ETF (IBB) has shown significant performance improvement in 2025, with a 26.1% increase over the past six months, outperforming the SPDR S&P 500 ETF Trust (SPY) which rose 24.4% during the same period [1] Performance Summary - The MSCI USA Pharmaceuticals, Biotechnology and Life Sciences Index had low returns of 3.74% in 2024 and 0.97% in 2023, contrasting with the MSCI USA index which returned 25.1% and 27.1% in those years [2] - The Biomedical and Genetics industry outperformed the S&P 500 with returns of 8.10% over the past three months and 6.38% over the past month, while the S&P 500 gained 7.05% and 2.45% respectively [3] Factors Behind the Rally - Biotech stocks are currently trading at cheaper valuations compared to the broader market, with the MSCI USA Pharmaceuticals, Biotechnology and Life Sciences Index at a forward P/E of 15.92X versus 23.25X for the MSCI USA index as of September 30, 2025 [5] - The Biomedical and Genetics industry has a forward P/E of 20.30X, slightly above the S&P 500's 20.22X, and a PEG ratio of 1.65X compared to the S&P 500's 2.34X, with projected EPS growth of 19.47% versus 7.04% for the S&P 500 [6] - Hopes for further Federal Reserve rate cuts are beneficial for biotech companies, which typically require cheaper funding, especially smaller firms [7] - Recent deals by major pharmaceutical companies like Pfizer and AstraZeneca to lower drug prices and avoid tariffs signal potential regulatory relief for the industry [9][10] Regulatory and Approval Landscape - The FDA has approved numerous biotechnology drugs in 2025, with 34 approvals so far, following 50 in 2024 and about 55 in 2023, indicating a steady flow of new products [11] Investment Activity - Biopharma venture investment reached $5.8 billion across 86 rounds in Q3 2025, totaling $17.1 billion year-to-date, with 35 M&A transactions amounting to $30.8 billion [12] - Licensing activity in biopharma has also been strong, with quarterly announced values reaching $63.7 billion and $183.7 billion year-to-date [13] ETF Focus - Biotech ETFs such as ALPS Medical Breakthroughs ETF (SBIO), Virtus Lifesci Biotech Clinical Trials ETF (BBC), Virtus Lifesci Biotech Products ETF (BBP), and S&P Biotech SPDR (XBI) are currently near their 52-week highs [14]