US OPEN: Bullish opening of Thursday’s session on Wall Street, Tesla surges after earnings, IBM misses

• Wall Street opens higher on Thursday.
• Tesla Inc. shares skyrocket 15% after reporting Q3 earnings.
• IBM Corp. shares dropped after Q3 revenue of $14.97 billion missed analyst estimates.
• UPS Inc. delivered strong Q3 results with earnings rising to $1.80 per share.

US equities are set for a bullish open, with the Nasdaq 100 leading gains, up 0.6%. Russell 2000 is 0.5% higher, while S&P 500 is set for 0.3% gain.

In Europe, most indexes are gaining today. NED25 and German DAX40 are leading with 1.2% and 1% rise respectively. French CAC40 and Italian ITA40 are 0.87% and 0.64% higher. The only index losing today is Polish W20, being 0.53% down.

The U.S. Department of Labor reported a decrease in initial jobless claims to 227K, lower than the forecasted 243K and the previous week's 242K, signaling a strengthening labor market. This decline suggests fewer layoffs and could boost consumer spending, positively impacting the U.S. economy. 

Lam Research Corp. shares remained steady after beating Q3 expectations with earnings of $0.86 per share and revenue of $4.17 billion, up 20% year-over-year. Tesla Inc. shares jumped 15% after reporting Q3 earnings of $0.72 per share, beating estimates of $0.60, with stronger-than-expected gross margins of 19.8%. CEO Elon Musk projected 20-30% vehicle sales growth potential for 2025, while announcing the company's focus on autonomous "Cybercab" development rather than a $25,000 Model 2. UPS Inc. delivered strong Q3 results with earnings rising to $1.80 per share, significantly above the expected $1.63, while revenue grew 5.6% to $22.25 billion. IBM Corp. shares dropped 5.5% after Q3 revenue of $14.97 billion missed analyst estimates of $15.07 billion, with infrastructure revenue falling 7%.

Current volatility observed on Wall Street. Source: xStation 

The Nasdaq-100 index, represented by the US100 contract, is currently trading above the 78.6% Fibonacci retracement level after a failed downward breakdown attempt yesterday. To maintain upward momentum, the key resistance at 20,638 needs to be cleared. This level corresponds to the weekly close all-time-high and has acted as strong resistance in the previous week.

For bears to gain control, they must first break below the 78.6% Fibonacci retracement level, followed by the mid-August highs at 19,917.81. These levels have provided significant support during the uptrend that began in late July. A break of these support zones could lead to a test of the 100-day and 50-day SMAs.

The RSI is showing signs of bearish divergence, with lower highs and lower lows, while the MACD is also widening, signaling potential bearish momentum. Despite this, the 50-day SMA is widening against the 100-day SMA after a bullish crossover, which still indicates underlying bullish momentum. Source: xStation 5

News:

• Lam Research Corp. (LRCX.US) shares gained 5% after beating Q3 expectations with earnings of $0.86 per share and revenue of $4.17 billion, up 20% year-over-year. While China revenue declined 8.6% YoY and represents 37% of total sales, the company saw strong growth in other Asian markets, with Taiwan revenues up 157%. The company projects Q4 EPS between $0.77 and $0.97, with revenue guidance of $4 to $4.6 billion, though gross margins are expected to decline to 46.9%.
• Tesla Inc. (TSLA.US) shares jumped 14% after reporting Q3 earnings of $0.72 per share, beating estimates of $0.60, with stronger-than-expected gross margins of 19.8%. CEO Elon Musk projected 20-30% vehicle sales growth potential for 2025, while announcing the company's focus on autonomous "Cybercab" development rather than a $25,000 Model 2. The company achieved its first positive gross margin on Cybertruck production and plans to expand its AI capabilities with 29,000 Nvidia H100 chips installed.

Q3 Earnings:

• Earnings per share: 72 cents, adjusted vs. 58 cents expected
• Earnings: $2.167 Bln. vs. $1.853 Bln. last year
• Revenue: $25.18 billion vs. $25.37 billion expected

• UPS Inc. (UPS.US) delivered strong Q3 results with earnings rising to $1.80 per share, significantly above the expected $1.63, while revenue grew 5.6% to $22.25 billion and gains 9.3%. U.S. shipment volumes increased 6.5% year-on-year, though the company lowered its annual revenue forecast to $91.1 billion from $93 billion due to the sale of Coyote Logistics. The results highlighted the resilience of U.S. consumer spending and domestic business performance.
• IBM Corp. (IBM.US) shares dropped 5.5% after Q3 revenue of $14.97 billion missed analyst estimates of $15.07 billion, with infrastructure revenue falling 7%. The company reported a net loss of $330 million due to a $2.7 billion pension-settlement charge, though CEO Arvind Krishna highlighted growth in AI business to over $3 billion. Despite the disappointing quarter, IBM's stock remains up more than 35% year-to-date.

Other news coming from individual S&P 500 index companies. Source: Bloomberg Financial LP