North American Morning Briefing: U.S. Stock Futures Rise as Sentiment on AI Lifted

U.S. futures were set for a largely higher open Wednesday, with shares

seemingly on track to continue a rally in artificial intelligence stocks seen earlier in Europe and in Asia.

Ahead of the opening bell, futures on the tech-heavy Nasdaq were rising as the S&P 500 was in positive territory. The Dow, meanwhile, was steady.

Oil futures fell, reversing gains seen early in European trade. Brent crude, however, hovered near $100.

Results from SpaceX overnight, as well as a suggestion it could merge with Tesla have injected fresh confidence into markets Wednesday. So too did preannounced quarterly earnings from Super Micro Computer.

SpaceX's third-quarter results should help answer investor concerns that the artificial-intelligence investment boom could slow, according to J.P. Morgan.

"We expect SpaceX to be the first of many this earnings season to temper concerns around power and financing constraints and reinforce momentum around the AI buildout."

Stocks to Watch

Netflix shares fell 6% after the company's recent earnings failed to excite investors.

SpaceX gained 9% as investors considered the merits of it combining with Tesla. Tesla shares, meanwhile, were up 1%.

Super Micro shares were up nearly 13% after preliminary results exceeded earlier guidance.

Watch For:

EIA Weekly Petroleum Status Report, and third-quarter earnings from AT&T, IBM, Meta and Tesla. Results are also expected from Lam Research.

Today's Top Headlines/Must Reads:

- Why AI's Deepest Mind Believes the World Is About to Change Radically

- More Oil Is Now Coming Out of the Persian Gulf Than Before the Iran War

- NYSE Is Getting Trounced in the Battle for Wall Street's Biggest IPOs

MARKET WRAPS Forex:

The dollar recovered against a basket of currencies.It was also supported by safe-haven flows and a weaker euro amid ongoing concerns about French debt.

Sterling was down slightly against the dollar, following higher-than-expected U.K. inflation data, while the euro fell against the pound.

Bonds:

Yields on Treasurys were little changed in European morning trade. The macroeconomic backdrop for global government bond markets hasn't changed in recent days, as inflation, budget and debt risks lingered on both sides of the Atlantic.

"For today, [bond] markets will likely search for direction, with no macro data on the agenda," Commerzbank rates strategist Erik Liem said in a note.

Energy:

Brent crude futures hovered near $110 a barrel, while West Texas Intermediate fell.

"Oil markets have held onto their recent gains, shaking off headlines on the diplomatic stance between Iran and the U.S.," MUFG said.

Metals:

Gold prices fell, with investors waiting for next week's Federal Reserve meeting for more cues on the monetary policy outlook.

TODAY'S TOP HEADLINES

Shares in Ray-Ban Maker EssilorLuxottica Gain as AI Glasses Continue to Shine

Shares in EssilorLuxottica surged after the eyewear group reported continued revenue strength at its AI-powered smartglasses business, though analysts warn that momentum may begin to tail off.

Revenue in the wearables division jumped 20% over the third quarter of the year to 486 million euros ($546.2 million), the Franco-Italian group said Tuesday. The wearables category-which houses the Ray-Ban and Oakley smartglasses made in tandem with tech giant Meta Platforms, as well as Nuance Audio glasses aimed at customers needing a boost to their hearing-still represents only a small slice of the group's total revenue, which came to 7.49 billion euros over the quarter. But the spurt ensured overall sales beat analysts' forecasts, and the group has been bullish over the category's growth prospects.

Jackdaw Gas Field Gets Green Light from U.K. Government

The British government has given the green light for production at the offshore gas field Jackdaw to begin, bringing an end to a protracted approvals process and allowing Shell and Equinor joint venture Adura to begin operations within weeks.

The Jackdaw project has been entangled in legal disputes and awaiting final government approval for some time. Hopes for progress were raised when new U.K. Prime Minister Andy Burnham promised a "pragmatic" approach to new drilling in the North Sea after global conflicts highlighted how vulnerable the country is to energy shocks.

Michelin Shares Drop on Weaker Volumes

Michelin shares fell Wednesday as the French tire maker reported a drop in third-quarter sales volumes.

Shares were 4.5% lower in early Paris trading.

U.K. Inflation Jumps Again on Rising Energy Costs

U.K. inflation rose further above the Bank of England's target in September as policymakers prepare for a meeting that investors expect will yield a first rate increase since the start of the war between the U.S. and Iran.

Consumer prices rose 3.5% in September compared with a year earlier, up from 3.1% in August, the Office for National Statistics said Wednesday. A consensus of economists polled by The Wall Street Journal expected a slightly cooler reading of 3.4%.

U.K. Government on Track to Cut Borrowing Ahead of Budget

The U.K. government cut borrowing in the first six months of its fiscal year, but at a slower pace than planned, underlining the challenges posed by rising prices and higher interest payments as it prepares to deliver its budget next week.

The budget comes as the U.K. is enjoying some time out of the limelight, having been a key focus of concern for investors following surprise tax cuts announced by then Prime Minister Liz Truss in 2022, which led to a sharp fall in the prices of government bonds.

Australia's Inflation Outlook Materially Worse, RBA Says

SYDNEY-Australia's inflation outlook is "materially worse" and coming third-quarter inflation data are likely to confirm that view, Andrew Hauser, deputy governor of the Reserve Bank of Australia, said Wednesday.

The comments come ahead of a policy meeting at the RBA in early November, where bond traders had cooled on the prospect of a further rise in interest rates.

Iran Is Using the Hostage Crisis Playbook. What Investors Need to Know.

Elevated oil prices, a primary driver of inflation, could last until President Donald Trump leaves the White House, according to Michael Schwartz, the dean of Wall Street's options strategists.Schwartz believes the Iranian regime is using the 1979-1981 hostage playbook to guide decisions during the current crisis with the U.S. Back then, Iran waited until Ronald Reagan defeated Jimmy Carter and was inaugurated to release hostages taken by students who stormed the U.S. embassy in Tehran.

"The Iranian terror regime will do everything it can to harm America, and interfering with the free flow of oil through the Strait of Hormuz is an effective way to increase global inflationary pressures, influence central bank policy, and even interfere with domestic U.S. politics," Schwartz, Oppenheimer's chief options strategist, told Barron's.

French Police Hunt for Suspected Rioters in Weekend Unrest

PARIS-France has settled into an uneasy calm after days of rioting, allowing authorities to focus on tracking down people suspected of looting shops and attacking government buildings in some of the worst unrest to rock the country in years.

Prime Minister Sébastien Lecornu has promised further arrests as police comb through footage of the riots. In the Paris region alone, some 200 investigators have been assigned to examine security camera footage and videos posted on social media.

Trump Envoy Tells Nervous Gulf Allies U.S. Can't Guarantee Security Forever

DOHA-Regional security officials received a sobering American message as they gathered in the Qatari capital and braced for a potential new round of escalation between the U.S. and Iran: They need to look out for themselves.

Tom Barrack, the U.S. ambassador to Turkey and President Trump's special envoy for Syria and Iraq, said the grand bargains that have underpinned global security for decades are undergoing major transformation, and countries in the Middle East and elsewhere should focus on securing themselves via regional partnerships.

Musk Ordered Starlink Slowdown That Blindsided Ukraine

WASHINGTON-Elon Musk ordered the slowdown of a military-grade version of Starlink relied on by Ukraine, a decision that sparked panic in Kyiv and confusion inside the Trump administration, U.S. officials and people familiar with the matter said.

Both Musk and President Trump have expressed anger at Ukraine for attacking Russian diesel refineries in recent weeks, which the president blames for high energy prices. Last week, Musk capped the speeds at which Ukrainian hardware could stay connected to the satellite-based network, the people said, rendering some offensive drones and interceptor drones virtually useless.

Airfield Attack Marked Opening Shot in Putin's Stepped-Up Sabotage Campaign

BERLIN-A massive cargo plane, used to carry military assistance to Ukraine and parked at an airfield in eastern Germany, was attacked by explosive-packed drones in early August. German officials say they were piloted by Russian military-intelligence agents.

One drone slammed into the Antonov freighter but failed to explode. Another collided with a different plane, and a third detonated near the airport perimeter, authorities say. Had the assault worked as planned, investigators say, the result would have been mayhem and casualties at one of Europe's most important air-cargo airports.

Write to pierre.bertrand@wsj.com

TODAY IN CANADA Earnings:

Waste Connections 3Q

Xtract One Technologies 4Q

Economic Indicators (ET):

Nothing major scheduled.

Stocks to Watch:

Hudbay, Mitsubishi Approve Copper World Project Construction; Copper World First Production Targeted for 2H 2029

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October 21, 2026 06:17 ET (10:17 GMT)

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