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The promise of a strong Q3 earnings season took a back seat Wednesday, for the first time this October, as realities of the present day give investors a good excuse for some profit-taking. Bond yields have wound down slightly from recent multi-decade highs, but remain elevated. And renewed attacks on Saudi energy infrastructure by Iran-backed Houthis have sent spot oil prices up +4.7% — $92 per barrel (/bbl) on WTI and $104/bbl for Brent crude.
Pre-market futures are in the red at this hour: the Dow is -399 points, the Nasdaq is -242 and the S&P 500 is -33 points. The small-cap Russell 2000 is -24 points at this hour. Over the past six months, these indexes are up +6%, +24%, +14% and +5.8%, respectively, with the Russell 2000 +10.5% year to date.
Weekly Jobless Claims Stay at Historic Lows While monthly jobs data continue to illustrate a flat labor market, Weekly Jobless Claims are once again demonstrating the absolute strength within the domestic employment space: +197K Initial Jobless Claims is 2K lower than the prior week (which had been revised higher by 2K), and marks the fourth-straight week under +200K new jobless claims. We’re currently at the lowest level of jobless claims post-Covid. Continuing Claims , reported a week in arrears from Initial Claims, bumped up a tad to +1.716 million, from a downwardly revised 1.699 million the previous week.
That sub-1.7 million longer-term jobless claims tally was the lowest since early April of 2023. For some context here, April of 2023 saw BLS monthly jobs gains of +253K. Last week’s BLS number for September 2026 was +29K.
Thus, we continue the narrative that the U.S. labor market is in a “low hire/low fire” zone. That it does not point to stronger growth going forward, it allows the Fed — which has a dual mandate: low inflation/full employment — to forego a move higher on interest rates at the end of this month. While the Inflation Rate is higher than where the Fed had preferred it to be, the Fed funds rate at +3.75-4.00% is still higher than year-over-year CPI at +3.4%.
Q3 Earnings Reports Ahead of the Open Meanwhile, PepsiCo ( PEP - Free Report ) outperformed expectations this morning in its Q3 earnings report — among the first companies in the quarter to release quarterly numbers — with earnings of $2.34 per share on revenues of $25.27 billion beating estimates by +2.18% and +1.59%, respectively. Shares are up +1% on the news, but still down more than -12% year to date. Consumer staples provider Helen of Troy ( HELE - Free Report ) — maker of OXO home products and Hydro Flasks, among others — posted a strong earnings beat ahead of today’s open for its fiscal Q2 report: $0.79 per share versus expectations for $0.51.
This amounts to a +54.9% positive surprise. Revenues were down -0.12% from estimates to $440.93 million in the quarter, but high guidance for the present quarter and full year are sending shares up +20% in today’s pre-market.
Source: Zacks Investment Research