Overnight U.S. Stocks | Major indexes mixed as SpaceX (SPCX.US) and Tesla (TSLA.US) discuss potential merger

According to Zhitong Finance APP, on Tuesday, the three major indices closed mixed, while U.S. President Trump stated that the Iran war would end soon. Oil prices retreated from earlier gains, which helped improve investor sentiment.

[U.S. Stocks] At the close, the Dow Jones Index rose 530.08 points, or 1.02%, to 52,496.11 points; the S&P 500 Index gained 21.92 points, or 0.29%, to 7,712.65 points; and the Nasdaq Composite Index fell 6.07 points, or 0.02%, to 26,424.82 points. SK hynix (SKHY.US) dropped 2%, General Motors (GM.US) fell 6.8%, Western Digital (WDC.US) rose 3%, and Apple (AAPL.US) slipped 1%. The Nasdaq Golden Dragon China Index rose 0.69%, with XPeng Motors (XPEV.US) surging more than 7%.

[European Stocks] The German DAX30 Index fell 3.91 points, or 0.02%, to 25,315.86 points; the UK FTSE 100 Index slipped 34.98 points, or 0.32%, to 10,729.71 points; France’s CAC40 Index dropped 29.56 points, or 0.38%, to 7,838.49 points; the Euro Stoxx 50 Index fell 20.06 points, or 0.33%, to 6,124.75 points; Spain’s IBEX35 Index gained 58.90 points, or 0.31%, to 19,098.20 points; and Italy’s FTSE MIB Index dropped 16.77 points, or 0.03%, to 49,069.50 points.

[Foreign Exchange] The U.S. dollar index, which measures the greenback against six major currencies, declined by 0.27%, closing at 101.701 in the late forex market. By the New York forex close, 1 euro exchanged at $1.1237, higher than the previous trading day’s $1.1212; 1 British pound exchanged at $1.3383, higher than the previous trading day’s $1.3305. 1 U.S. dollar exchanged at 158.20 Japanese yen, lower than the previous trading day's 158.52 yen; 1 U.S. dollar exchanged at 0.8248 Swiss franc, below the previous trading day's 0.8265 Swiss franc; 1 U.S. dollar exchanged at 1.4057 Canadian dollars, below the previous trading day's 1.4106 Canadian dollars; and 1 U.S. dollar exchanged at 9.8979 Swedish krona, down from the previous trading day's 9.9200 Swedish krona.

[Cryptocurrency] Bitcoin rose more than 1%, briefly regaining the $83,000 mark, and was last reported at $82,997 at the time of publication. Ethereum climbed over 2.3%, quoted at $2,459.

[Precious Metals] Spot gold was at $4,124.96 per ounce; spot silver at $57.984 per ounce.

[Crude Oil] The price of light crude oil futures for November delivery on the New York Mercantile Exchange fell $1.87 to close at $101.79 per barrel, a decline of 1.8%. Brent crude oil futures for December delivery on the London Exchange fell $0.76 to close at $108.79 per barrel, a decrease of 0.69%.

[Macroeconomic News]

Iran's Foreign Minister Says Indirect Negotiations with the U.S. Continue via Mediators; Refuses to Disclose U.S. Additional Conditions. Iran's Foreign Minister Araghchi said in an exclusive interview with a Middle Eastern TV station that indirect negotiations with the U.S. are ongoing through mediators such as Pakistan and Qatar. Iran had previously proposed a "seven-day plan" to the U.S., with clear conditions listed; under this plan, the Strait of Hormuz was scheduled to be fully reopened on the sixth day. Araghchi stated that the U.S. had told Iran it agreed to these conditions but wished to add several clauses. When asked whether these new U.S. conditions involved security or economic matters, he declined to elaborate, saying, "We will not negotiate through your channel." Araghchi emphasized that Iran requires the U.S. to fulfill all commitments in the previously signed "Islamabad Memorandum of Understanding"; only after the U.S. does so can further negotiations on other topics occur. He noted that, in the final phase of talks, either side could raise any subjects or issues for discussion and reach a final agreement on them.

U.S. Treasury Secretary Bessent: Expects No Spillover Effects from French Bond Market Turmoil. U.S. Treasury Secretary Bessent stated he does not expect the French bond market turmoil to have spillover effects. Previously, French bond yields had surged, sparking broader concerns about the European nation’s fiscal health. “I do not expect the French situation to impact other markets,” Bessent said Tuesday. “France is in a tough spot, but I know President Macron’s economic team very well, and they are indeed very good.” In recent weeks, France has seen a wave of protests and escalating unrest over the weekend, bringing unexpected pressure on the government. This has further exacerbated the country’s debt problems, with its debt performance lagging behind peer nations, even as the government strives to control its budget deficit. Bessent added, “This is not what we anticipated, but we do see capital flowing from some concerning countries into U.S. Treasuries seeking safety.”

[Company News]

SpaceX and Tesla Establish Special Committees to Explore Merger Possibilities. SpaceX (SPCX.US) and Tesla (TSLA.US) have set up special committees to explore potential merger deals. Musk revealed in SpaceX’s earnings call that both companies had established committees composed of independent directors to assess the feasibility of a potential transaction. Musk said, “Because I have a conflict of interest, I can’t actually participate in these discussions,” but added, “I think it’s a good idea.” Musk pointed out that closer cooperation in areas such as artificial intelligence, chips, robotics, and communication connectivity between the two companies could yield substantial benefits. However, he also emphasized that a merger is not a done deal. “If you say this thing is already decided, that would be an exaggeration,” Musk said, noting that a deal would require approval from 50% of Tesla’s shareholders, which is a rather high bar.

Jet Fuel Costs Soar, Eroding Profits; United Airlines Q4 Profit Guidance Misses Expectations. United Airlines (UAL.US) expects its fourth-quarter profit this year to fall short of market expectations. This highlights that, despite continued strong demand for air travel, soaring jet fuel prices are persistently eroding airline profits. The company expects adjusted earnings per share for the fourth quarter to be in the range of $0.50 to $1.50, below the analysts’ average forecast of $1.88. In the prior quarter, the company’s fuel expenses surged 61.6%, reaching $4.84 billion. This guidance assumes that jet fuel prices will rise from an average of $3.90 per gallon in Q3 to $4.80 per gallon. For an industry still absorbing billions of dollars of extra costs from the Middle East war, this is another blow. High fuel costs could offset the revenue gains brought by higher ticket prices and strong spending from affluent travelers for U.S. airlines. To cope with rising costs, airlines are increasingly resorting to raising ticket prices and cutting flight schedules, but there is currently little sign that this cost pressure will ease in the short term.

Qualcomm Reportedly to Implement Performance-Based Layoffs Globally. Qualcomm (QCOM.US) CEO Cristiano Amon informed employees in a memo on Monday that the company will carry out “performance-based layoffs” following the annual employee assessment. Amon said the layoffs aim to build a “stronger performance culture” and address the company’s “persistent underperformance.” The memo did not specify how many positions would be affected. Amon wrote in the memo that, during the layoff process, business priorities, organizational needs, skills, and expertise would all be considered. “As our business expands, the capabilities and skills we need continue to increase,” he wrote. “We must have the right people in the right roles so they can perform at their best and the company can continue to succeed.”