Wall Street Breakfast: What Moved Markets

Eye on oil

Crude oil prices spiked this week as a surprise attack by Hamas on Israel led the latter to declare an all-out war on the militant group, with more than 2,800 casualties on both sides. "While oil fundamentals have not changed since these attacks, it does not mean they won’t," ING Economic and Financial Analysis warned, flagging risks to oil supply. Supply disruptions in the Middle East weren't the only things on the minds of energy investors, with Exxon Mobil (XOM) announcing a $60B blockbuster deal for Pioneer Natural Resources (PXD). The deal is expected to add valuable acreage near some of Exxon's fields and make it the dominant producer in the Permian Basin. (182 comments)

Weak debut

Birkenstock (BIRK) opened trading on Wednesday at $41 per share after pricing its highly-anticipated IPO at $46 apiece, which valued the company at $8.6B. The iconic shoemaker's stock stumbled throughout the session, finally ending 12.6% lower at $40.20 a share. Based on Birkenstock's (BIRK) SEC filings, the stock began trading with a higher price-to-earnings multiple than sector peers such as Skechers (SKX), Crocs (CROX), and Steve Madden (SHOO). Wider concerns regarding Birkenstock's financials remain, given the premium valuation it'd sought in the IPO. SA analyst Douglas McKenny called it a "dangerous" stock to buy on account of its weak profitability. (13 comments)

Strike heats up

Inflation check

Retail inflation slowed again in Sept. from the prior month, but came in hotter than expected as rental costs surged, accounting for more than half of the increase. Growth in the Consumer Price Index slowed to 0.4% M/M from a 0.6% increase in Aug. Core CPI, which excludes food and energy, stayed steady at a 0.3% M/M increase. The latest data pushed stock markets lower, while Treasury yields rose. Investing Group Leader David Alton Clark, said the data indicated that rate hikes are "by and large" over, but Boston Federal Reserve President Susan Collins said she wouldn't "take further tightening off the table yet." Note that the Producer Price Index growth had also slowed, but was still stronger than expected. (122 comments)

U.K. approval

Microsoft's (MSFT) revised $69B offer to acquire Activision Blizzard (ATVI) has passed muster with U.K. regulators, clearing the way for the technology sector's biggest-ever acquisition. The U.K.'s Competition and Markets Authority granted consent for the revised deal today, which excludes Activision's cloud streaming rights that will be sold to French firm Ubisoft (OTCPK:UBSFY). The regulator's objections to the mega deal marked the last major global hurdle for the acquisition that has been more than a year and a half in the making. SA analyst DJTF Investments had rated Activision a 'Hold,' given the deal value's limited upside to Activision's shares and uncertainty over the deal's closing date. (20 comments)

Weekly movement

U.S. Indices
Dow +0.8% to 33,670. S&P 500 +0.5% to 4,328. Nasdaq -0.2% to 13,407. Russell 2000 -1.7% to 1,717. CBOE Volatility Index +10.7% to 19.32.

S&P 500 Sectors
Consumer Staples +0.2%. Utilities +3.6%. Financials +0.5%. Telecom -0.2%. Healthcare +0.1%. Industrials +1.%. Information Technology +0.2%. Materials -0.4%. Energy +4.5%. Consumer Discretionary -0.7%. Real Estate +2.7%.

World Indices
London +1.4% to 7,600. France -0.8% to 7,004. Germany -0.3% to 15,187. Japan +4.2% to 32,290. China -0.7% to 3,088. Hong Kong +1.6% to 17,759. India +0.4% to 66,283.

Commodities and Bonds
Crude Oil WTI +6% to $87.72/bbl. Gold +5.5% to $1,945.9/oz. Natural Gas -3.9% to 3.208. Ten-Year Bond Yield -0.2 bps to 4.616.

Forex and Cryptos
EUR/USD -0.72%. USD/JPY +0.17%. GBP/USD -0.77%. Bitcoin -3.7%. Litecoin -5.7%. Ethereum -4.8%. XRP -6.9%.

Top S&P 500 Gainers
Northrop Grumman (NOC) +16%. Marathon Oil (MRO) +14%. Huntington Ingalls Industries (HII) +11%. EOG Resources (EOG) +11%. Devon Energy (DVN) +11%.

Top S&P 500 Losers
DaVita (DVA) -18%. Hormel Foods (HRL) -13%. Baxter International (BAX) -13%. Lamb Weston Holdings (LW) -11%. Norwegian Cruise Line Holdings (NCLH) -11%.

Where will the markets be headed next week? Current trends and ideas? Add your thoughts to the comments section.