Global stock markets are taking a nosedive, thanks to the escalating tensions between Russia and Ukraine. Wall Street futures are painting a gloomy picture, with the Dow Jones set to open 0.6% lower, the S&P 500 down 0.4%, and the Nasdaq slipping 0.5%. Europe’s main indices are also in the red. The geopolitical drama has intensified as Russian President Vladimir Putin has tweaked Russia's nuclear doctrine, lowering the threshold for nuclear weapon use. This has sent investors scurrying towards safer havens like government bonds and gold. The yield on the 10-year U.S. Treasury has dipped to 4.36%, while gold prices have climbed by 0.7%. Defense stocks are among the few basking in the glow of investor interest.

Across the pond, U.S. investors are eagerly awaiting corporate earnings, with Nvidia's results on Wednesday being a particular focal point. Nvidia's performance is pivotal as it could sway the valuation of the artificial intelligence sector. Meanwhile, political developments in the U.S. are under the spotlight, with President-elect Donald Trump yet to unveil key appointments for roles like Treasury Secretary. In corporate news, Super Micro Computer has seen a pre-market surge of 24% after appointing a new auditor and submitting a compliance plan to Nasdaq. On the flip side, Alphabet's shares have dipped 1% in pre-market trading due to potential antitrust actions involving its Chrome browser.

The stock market is still mulling over the implications of the second Trump presidency, especially concerning interest rates. As we edge into mid-November, the financial news cycle typically slows down, with only a handful of sessions left until Christmas. However, this trend is upended during a U.S. presidential election year, making November a bustling month. This year is no exception, with Donald Trump's second term stirring up a fair amount of turmoil and uncertainty, even more so than his first. Recently, the initial market euphoria has given way to caution, linked to the presumed inflationary impact of Trump's proposed policies. And let's not even get started on the geopolitical risk posed by potential trade barriers.

Yesterday, Europe's stock markets were rather lackluster, while the U.S. attempted a rebound. The S&P 500 recovered 0.4%, and the Nasdaq 100 broke a five-session losing streak with a 0.7% gain. Technology stocks rallied, despite Nvidia's woes, which saw a slight dip of just over 1% following rumors of overheating issues with its new AI chip. Nevertheless, Nvidia retained its crown as the world's leading capitalization, a title it snatched from Apple. Whether it will hold onto this position after tomorrow's results is anyone's guess. In checking Nvidia's market weight, I noticed that European stocks have vanished from the global Top 20. Novo Nordisk's recent decline has cost it its 20th place, now occupied by Tencent. The global stock market elite now features 17 U.S.-based companies, one in Saudi Arabia (Aramco), one in Taiwan (TSMC), and one in China (Tencent). Europe's second-largest stock, LVMH ($311 billion), ranks 27th. Back in 2004, Europe boasted nine companies in the world's top 30. This could be seen as a demotion for old Europe. In a twist, the Financial Times reported that the EU plans to require Chinese companies to transfer their technologies to European firms to receive aid for setting up shop on European soil. It's a curious turn of events. In the 90s, everyone was up in arms over the technology transfers Beijing demanded from Westerners setting up in China. The big difference now is that China's policy was aggressive and assertive, while the EU's is, at least for now, defensive and subdued.

In Asia-Pacific, markets were on the rise this morning. India's Nifty 50 ended 0.3% higher, while Taiwan benefited from a semiconductor segment boost, gaining 1.3%. Australia (+0.9%) and Japan (+0.5%) are in good spirits. However, Hong Kong and Korea are seeing only minimal gains.

Today's economic highlights:

Eurostat's second reading of EU inflation in October, US October building permits and housing starts are on the calendar. See the full calendar here. 

The dollar is worth EUR 0.9452 and GBP 0.7908. The ounce of gold rose to USD 2,631. Oil regained some ground, with North Sea Brent at USD 73.23 a barrel and US light crude WTI at USD 69.11. The yield on 10-year US debt is down to 4.36%. Bitcoin remains above USD 90,000.

In corporate news:

  • The US Department of Justice is pressuring Alphabet to divest its Chrome browser due to antitrust concerns, while Google's AI investments, including a partnership with Anthropic, receive regulatory clearances and collaborations in quantum computing with Nvidia progress.
  • Nvidia's Q3 earnings report highlights revenue from Blackwell, alongside collaborations with Google Quantum AI and nVent Electric for quantum computing and cooling devices, respectively, amidst expectations of market impact due to potential Federal Reserve rate cuts and a snag in AI chip design, influencing tech stock and cryptocurrency movements.
  • Tesla's stock price surged amid reports of potential deregulation on autonomous vehicles and plans for a Berlin Gigafactory expansion, despite environmental protests and skepticism from a CIO, while President-elect Trump shows interest in technology by potentially attending a SpaceX launch, and his administration prioritizes a federal framework for self-driving vehicles.
  • Activist investor Ananym Capital Management is pressuring Henry Schein to overhaul its board, divest its medical distribution business, cut costs, and replace CEO Stanley Bergman.
  • XPeng significantly reduced its net loss for the third quarter, driven by strong sales of new car models, an 18% increase in revenue, and record profit margins.
  • Spirit Airlines has filed for Chapter 11 bankruptcy protection to restructure its debt, with the support of most of its creditors, impacting its stock market listing and leading to bondholders taking control, while aiming to enhance passenger services.
  • Medtronic raised its annual profit forecast and narrowed its fiscal year guidance after reporting a rise in fiscal Q2 non-GAAP earnings and revenue of $8.40B, surpassing street estimates and expectations.
  • Meta Platforms plans to contest India's antitrust directive prohibiting WhatsApp from sharing data with other apps, amidst broader tech stock gains and issues with Facebook scams involving Taiwanese banks.
  • Trip.com Group reported higher-than-expected third-quarter earnings and revenue, driven by robust travel demand, leading to a significant increase in non-GAAP income and a jump in share prices after hours.
  • Tuya Inc. reported a Q3 Non-GAAP net profit with an EPS of $0.04, revenue of $81.6M, a narrowing loss, and sold 13% of its shares to 65 Equity Partners.

Analyst recommendations:

  • Kraft Heinz: Piper Sandler & Co downgrades to neutral from overweight with a price target reduced from USD 40 to USD 35.
  • Qualcomm, Inc.: President Capital Management Corp downgrades to hold from buy with a target price reduced from USD 208 to USD 178.
  • Quantumscape Corporation: HSBC upgrades to hold from reduce with a price target raised from USD 4.70 to USD 5.30.
  • Walt Disney Company (The): Baptista Research upgrades to hold from buy with a price target raised from USD 111.40 to USD 127.
  • Applovin Corporation: Citigroup maintains its buy recommendation and raises the target price from USD 185 to USD 335.
  • Bellring Brands, Inc.: D.A. Davidson maintains a neutral recommendation with a price target raised from 62 to USD 75.
  • Booking Holdings Inc.: Tigress Financial Partners maintains its strong buy recommendation and raises the target price from USD 4580 to USD 5600.
  • Fortinet, Inc.: Piper Sandler & Co maintains a neutral recommendation with a price target raised from 80 to USD 100.
  • Netflix, Inc.: Jefferies maintains its buy recommendation and raises the target price from USD 800 to USD 1000.
  • Reddit, Inc.: Piper Sandler & Co maintains its overweight recommendation and raises the target price from USD 115 to USD 150.
  • Spotify Technology S.a.: Baptista Research downgrades to underperform from hold with a price target raised from USD 364.30 to USD 457.20.
  • United Airlines Holdings, Inc.: TD Cowen maintains its buy recommendation and raises the target price from USD 100 to USD 125.
  • W.w. Grainger, Inc.: Morgan Stanley maintains its market weight recommendation and raises the target price from USD 990 to USD 1215.
  • Wells Fargo & Company: Citigroup remains neutral recommendation with a price target raised from USD 67 to USD 82.
  • BP Plc: AlphaValue/Baader Europe downgrades to reduce from buy with a price target reduced from GBX 527 to GBX 402.
  • Diploma Plc: Shore Capital downgrades to hold from buy with a target price of GBX 4150.
  • Severn Trent Plc: BNP Paribas Exane downgrades to neutral from outperform with a target price reduced from GBX 2796 to GBX 2750.
  • United Utilities: BNP Paribas Exane upgrades to outperform from neutral with a target price raised from GBX 1091 to GBX 1250.
  • The Bank Of Nova Scotia: Canaccord Genuity upgrades to buy from hold with a target price raised from CAD 71 to CAD 84.