The Closing Bell
Markets close out the week caught between a resilient PMI print and a Michigan sentiment read that is flashing recession-era anxiety, with oil's surge doing the real damage to risk appetite.
Macro sends mixed signals, and consumers are flinching.
The S&P Global flash PMIs came in hot, services at 57.9, manufacturing at 56, composite at 57.6, pointing to an economy still expanding briskly. But Michigan's consumer sentiment read collapsed to 48, with consumer expectations at 48.8 and year-ahead inflation expectations jumping to 4.7%. That combination, strong business activity against a consumer bracing for higher prices, is the story of the day. Oil is the connective tissue: USO jumped 4.3% as President Trump invoked the Defense Production Act for petroleum refining and reports circulated that gas prices will stay elevated through the election. Procter & Gamble (PG) fell 2.7% even as Citigroup, BNP Paribas and other desks raised price targets, with analysts flagging that rising oil costs could undercut the company's turnaround. Treasuries softened, with TLT down 0.5%, and the dollar firmed slightly.
Tech cools, defensives hold the line.
The broad tape leaned risk-off: the S&P 500 (SPY) slipped 0.5% and the Russell 2000 (IWM) eased 0.3%, while the Nasdaq (QQQ) was essentially flat. Meta Platforms (META) dropped 1% after Rhode Island filed suit over scam ads, adding to legal overhang that already includes Texas AG Paxton's suit against OpenAI, a case that also touches Microsoft (MSFT), which still managed a modest gain. Apple (AAPL) was little changed even with the splashy unveiling of its first foldable phone, the iPhone Duo. General Motors (GM) fell 1.7% and is logging its worst week since 2023, compounded by news it will close the Brownstown battery assembly plant, a sign EV strategy is still being reworked across Detroit.
Dow Inc rallies, Datadog gets a lift, Old Republic gets downgraded.
Chemicals name Dow Inc (DOW) jumped 2.5% after a better-than-expected third quarter, drawing price target raises from UBS, Citigroup and others, even as most keep ratings at neutral. Datadog (DDOG) climbed 4.6% on a BofA price target raise to $335 and reports it has offered to acquire Upwind Security. Old Republic International (ORI) slid 2.9% after Raymond James downgraded the stock despite Piper Sandler lifting its target. SpaceX (SPCX) gained 1.8% after confirming a potential Tesla merger is being explored, pending controlling shareholder approval, a headline that will dominate chatter into next week.
After the bell and tomorrow.
First Hawaiian (FHB) and Sallie Mae (SLM) posted quarterly results this morning, with American Express and First Citizens BancShares also on today's earnings slate as the regional bank and consumer finance cohort rolls through reports. Verizon's print is in focus for next week as investors weigh SpaceX competition risk. Watch oil and refining policy follow-through, GM's EV retrenchment, and whether Meta's legal exposure widens.
Bottom line: strong PMI data could not offset a consumer sentiment air pocket and surging oil, pushing money out of mega-cap tech and into energy and industrial value names like Dow Inc to close the week.