Ray: Good morning, this is Biscuits and Tickers for Thursday, October twenty second. I'm Ray.

Nora: And I'm Nora. Futures are lower this morning. Mixed reactions to Tesla and Meta, a sharp drop in IBM, and Brent crude back above one hundred ten dollars have put investors in a risk-off mood.

Ray: Here's where we stand. As of about eight twenty five Eastern, the S and P 500 tracking fund was down about nine tenths of a percent in pre-market trading. The Nasdaq 100 fund was off about one and a half percent, and the Dow and Russell 2000 funds were each down a bit more than half a percent.

Ray: That follows a solid Wednesday. The S and P 500 rose about six tenths of a percent to close at 7,757. The Nasdaq Composite gained about one percent and the Dow added seven tenths of a percent. The VIX volatility index has climbed to about eighteen, up from just under seventeen at Wednesday's close.

Nora: Overseas, Asia had a rough session. According to Investrade, Japan's Nikkei fell about two and a half percent and Hong Kong's Hang Seng dropped more than three percent. In Europe, Germany's DAX is down about one percent and London's FTSE about half a percent.

Nora: Oil is the big macro story again. Brent crude is up about three percent to around one hundred twelve dollars a barrel, its highest since May, per MT Newswires and Commerzbank. U.S. crude is near ninety nine dollars. Investrade cites Middle East tensions, including more Houthi attacks in Saudi Arabia. Treasuries are firmer, with the ten year yield down about five basis points to around five point oh seven percent. Gold is lower, near forty one hundred dollars an ounce.

Ray: On today's calendar. At eight thirty Eastern we get weekly jobless claims, with economists expecting about two hundred thousand. At ten comes the Conference Board's leading index for September, expected to dip a tenth of a percent. Natural gas inventories are at ten thirty, and the Kansas City Fed manufacturing survey is at eleven. Investrade lists no Fed speakers today.

Nora: Earnings keep coming. Before the open we've already heard from Procter and Gamble, Honeywell, Comcast, Blackstone, Union Pacific, Lockheed Martin, Dow, American Airlines and Valero. After the close, watch Western Digital, Newmont, Deckers, Omnicom, Comfort Systems and Bloom Energy.

Ray: Our first story is Meta Platforms, ticker M E T A. Fortune reports third quarter revenue rose twenty six percent to sixty four point six billion dollars, ahead of the roughly sixty three point three billion analysts expected.

Ray: But the quarter included a ten billion dollar settlement with a group of state attorneys general over youth safety. Fortune says that cut reported earnings to three dollars eighty three a share. Without it, earnings would have been seven dollars forty.

Nora: Spending is the other focus. Meta raised the low end of its twenty twenty six capital spending range, now one hundred thirty five to one hundred forty five billion dollars. Free cash flow turned negative, at minus two point one billion dollars. Meta also announced a two for one stock split and a new non-voting share class, effective January twenty twenty seven, according to Forbes and Investrade. The stock is down about three percent pre-market.

Ray: Next, Tesla, ticker T S L A. According to Electrek, third quarter revenue was flat at about twenty eight billion dollars, in line with estimates. Adjusted earnings of forty eight cents beat the forty five cent consensus. GAAP net income fell forty three percent, while automotive margins improved from the second quarter.

Nora: Investing.com reports Tesla trimmed its capital spending forecast to about twenty billion dollars. It says Elon Musk lowered his vehicle sales goal to five million a year by the end of the decade, well below an earlier projection of twenty million. Free cash flow came in at one point five billion dollars, much better than many feared. The stock is down about four percent before the bell.

Ray: Our third story is oil. Brent's climb back above one hundred ten dollars is landing on a market already worried about inflation and a ten year yield that has spent weeks near five percent.

Nora: Investrade points to fresh Houthi attacks in Saudi Arabia, which have raised fears of a wider conflict and supply disruption. Refiners are the clear winners. Valero reported its highest ever quarterly profit, which it tied to refining margins boosted by Middle East disruptions. For the rest of the market, higher fuel costs are a headwind, especially for airlines and consumer companies.

Ray: Our fourth story is a test of the AI trade. IBM, ticker I B M, is down about seven percent pre-market. Investing.com reports earnings and revenue beat estimates, but gross margin missed and IBM kept its full-year growth outlook at four to five percent. Comments that corporate customers are questioning returns on AI also weighed on the stock.

Nora: Chip equipment maker Lam Research, ticker L R C X, is down about eight percent despite record revenue of eight point two two billion dollars, up fifty four percent. Investors appear to be setting a very high bar for AI-linked names, and those worries are hitting the Nasdaq hardest this morning.

Ray: Other pre-market movers, per Investing.com. Gainers include chemical maker Dow, ticker D O W, up more than two and a half percent after an earnings beat and a plan to cut thirteen percent of its workforce. Lockheed Martin, ticker L M T, is up nearly two and a half percent after raising guidance and reporting a record backlog of two hundred ninety two billion dollars.

Ray: Spotify, ticker S P O T, is up nearly four percent on a fourth quarter profit forecast slightly above consensus. Railroad C S X, ticker C S X, is up more than two percent after a beat. On the downside, pest control company Rollins, ticker R O L, is down about seven percent after missing on revenue and earnings.

Nora: By sector, the pattern is risk-off. Energy and defense are holding up as oil climbs and geopolitical tensions rise. Big tech and semiconductors are leading the declines. Texas Instruments is little changed, and Southwest Airlines beat for the third quarter but guided fourth quarter earnings below estimates, according to Investrade.

Ray: Here's what to watch today. First, jobless claims at eight thirty, for any sign of labor market cooling. Second, whether Brent holds above one hundred ten dollars. Third, the ten year yield near five percent. Fourth, whether the selling in big tech and chip stocks continues after the open. And after the bell, Western Digital and Newmont report.

Nora: That's Biscuits and Tickers for Thursday, October twenty second. This briefing is information only, not investment advice. I'm Nora.

Ray: And I'm Ray. Have a good trading day.