CLOSING BELL
Hidden Red October
Markets fell, after Wednesday’s good jobs data turned into Thursday’s bad jobs data when another private employer said October had 183% more layoffs than the month before.
It was a red October for job cuts, the worst in 20 years, according to the report, and treasurys rallied. Speaking of jobs, Nancy Pelosi said she was retiring next year, a big loss for growth investors tracking her trades.
AI and tech declined as good (fine) earnings reports from Arm and Qualcomm faced insane expectations.The Trump Admin said there would be no bailout for AI investments it was making, after a conference comment from OpenAI CFO Sarah Friar gained the attention of Chief Sam Altman. Altman wrote a book-long twitter post to say he didn’t expect a bailout if massive AI spending goes wrong.
Speaking of government, it’s the 37th day of a government shutdown, thousands of flights are set to be canceled tomorrow, while the Trump admin is arguing it deserves to declare emergency tariffs on anything at any time. The SCOTUS is not buying it yet. Big news if these past six months of import taxes are reversed, who knows what would happen to equity prices and trade deals. The admin also cut costs for weight loss drugs.
Today's RIP: Oct was a Red Jobs Month, Tesla shareholders approve Musks $1T pay package, a ton of earnings, and somehow more.
2 of 11 sectors closed green. Energy $XLE ( ▲ 0.97% ) lead and discretionary $XLY ( ▼ 2.31% ) lagged.
$SPY ( ▼ 1.07% ) $QQQ ( ▼ 1.86% ) $IWM ( ▼ 1.77% ) $DIA ( ▼ 0.81% )
SHAREHOLDER DEMOCRACY
Shareholders Approve Musk’s Massive Pay Package
$TSLA ( ▼ 3.5% ) shareholders approved Elon Musk’s monstrous pay package on Thursday, granting the world’s richest person a roadmap to become even richer. The vote was positioned to give Musk 25% voting control over the Mag 7 giant Tesla.
The deal gives Musk access to 423M more shares of the company, up to 12% of the adjusted share count, over 12 tranches released as long as the company meets performance goals. Each share reward comes after the company breaks $2T in valuation, then every $500B in valuation added, alongside operational goals shown below:
Tesla proxy filing
Romaine Bostick, CFA Editor at Bloomberg, pointed out the $1T number was a focus because, duh, it is absurdly large, but for many shareholders, the choice was about corporate control and job retention;they like Musk and think he can achive his vision of AI-driven cars and robots. Without a guarantee of voting control and job security, Musk can just “pick up his toys and go play somewhere else,” Bostick said.
More than 75% of the shareholders’ vote went in favor of the Musk pay package. Institutional investors, hedge funds, and pension plans were initially unknown factors in the voting process but ultimately supported the plan set by the board in favor of Musk.
Musk just needs to 8X Tesla bags to get his payout.
AFTER THE BELL
No One Could Have Predicted DraftKings’ Predictions
Draftkings $DKNG ( ▲ 0.22% ) was fallingafter the bell following its Q3 report, posting an adjusted loss and $1.1B in sales for the quarter, which were a disappointment to traders betting on the upside.
The sports book cut its 2025 adjusted EBITDA estimate in half, from $800-$900 to a most $550M. It announced Thursday morning it would become the official sportsbook of ESPN, a great visibility and marketing play with Disney, but an unknown cost to shareholders.
DraftKings also announced prediction markets after acquiring Railbird Tech last month, mostly for the UI. The company wants to launch a prettier-looking app just for predictions, it said, after predictions markets Kalshi and Polymarket ate its lunch this past year.
Prediction markets are regulated federally, and circumvent more strict state regulations, effectively allowing betting anywhere.
It wasn’t the only declining stock after the bell. $XYZ ( ▼ 3.69% ) Block sank 10% after missing Q3 estimates with $6.11B in revenue and $0.54 EPS, both below consensus. Despite strong Cash App and Square GPV growth, investors punished the stock for weak margins and slowing Bitcoin revenue. $ACHR ( ▼ 7.21% ) Archer dropped 9% after announcing an 81M share offering at $8 to fund its $126M Hawthorne Airport acquisition.
It wasn’t all bad news- $AFRM ( ▼ 7.77% )jumped 10% after posting a surprise Q1 profit of $0.23 per share and record $933M revenue, beating estimates GMV hit an all-time high despite few shopping holidays, and Q2 guidance came in strong.
MACRO NEWS
Bad Jobs Market (One Day After I Said Good Jobs Market)
Layoffs in the month of October were at their highest since 2003, according to research by Challenger, Gray & Christmas HR advisors. U.S. based employers announced 153,074 job cuts in October, second highest month this year for layoffs in a reversal of this week’s ADP October job hiring data which looked healthy.
The report found there have been 1.1M layoffs this year, a 44% jump from the first compared to 2024, and there’s still two months left to go. There was a huge number of cuts in March in their findings due to DODGE firings in the Federal Government.
Andy Challenger, CRO at the firm, said it was the worst start to a fourth-quarter labor market since the financial meltdown of 2008. Companies seemingly no longer wait until after the holiday season to cut the workforce, he said.
“Over the last decade, companies have shied away from announcing layoffs in the fourth quarter, so it’s surprising to see so many in October.”
It’s data like this, that pushes some to call for cuts at the Federal Reserve, releases the money supply, and get firms juiced up to hire again. The lack of official data from the Fed is prompting others to exercise caution. Chicago Fed’s Goolsbee said Thursday he wanted to get Fed data before deciding on more cuts.
MORE EARNINGS
Reporting Round Up 11/6
Snap $SNAP ( ▲ 9.73% ) Robinhood $HOOD ( ▼ 10.81% ) Celesius $CELH ( ▼ 24.8% ) and $DUOL ( ▼ 25.49% ) were still moving from their Wednesday night reports. Snap was climbing on its $00M perplexity deal and beat, Doulingo was falling on lower margins, and Celsius basically spent a ton of money on new drink acquisitions and stocking shelves, missing earnings estimates.
Here were the top names moving on Thursday reports:
e.l.f. Beauty $ELF ( ▼ 35.04% )
ELF crashed 29% after missing revenue estimates and guiding for a 17% EPS decline in fiscal 2026 due to $50M in tariff costs and slowing organic growth. Net sales came in more than $120M short. The Rhode acquisition is driving most of the growth, but margins and core brand momentum are under pressure.
Datadog $DDOG ( ▲ 23.13% )
Datadog soared 23% after crushing Q3 earnings with 28% revenue growth, strong free cash flow, and rising AI-native customer spend. The company raised full-year guidance and now serves over 4,060 enterprise clients with $100K in annual recurring revenue.
Moderna $MRNA ( ▲ 3.27% )
Moderna posted a smaller-than-expected Q3 loss of $0.51 per share and beat revenue estimates with $1B in sales, mostly from COVID vaccines. It cut R&D spending and narrowed its 2025 revenue forecast to $1.6–$2B amid declining vaccination rates.
D-Wave Quantum $QBTS ( ▼ 8.48% )
D-Wave beat Q3 expectations with $3.7M in revenue, up 100% from last year. D-Wave recorded a $140M net loss, attributed to warrants and warrant exercises, what CEO Alan Baratz told Barrons was just a “paper loss.”
POPS & DROPS
Top Stocks News Stories
- SkyWater Technology rose 27% after CHIPS Act funding award.
- CoreWeave fell 6% after announcing a $1.17B AI deal with Vast.
- JPMorgan flagged Bitcoin as undervalued vs gold, est. $170K.
- Boeing avoided criminal charges in DOJ deal over 737 Max crashes.
- Fed’s Goolsbee warned rate cuts may be premature.
- XRP fell 5% as Bitcoin ETFs posted major outflows.
- Qualcomm fell 4% after a price target, weak near-term fundamentals.
- Duolingo fell 21% after rising costs and margin pressure spooked investors.
WHAT’S ON DECK
Tomorrow’s Top Things
Economic data: FOMC Member Williams Speaks (4:00 AM), Michigan Inflation Expectations (11:00 AM), NY Fed 1-Year Inflation Expectations (12:00 PM), U.S. Baker Hughes Total Rig Count (2:00 PM), Consumer Credit (4:00 PM)
Pre-Market Earnings: Canopy Growth ($CGC), Enbridge ($ENB), Wendy’s ($WEN), Constellation Energy ($CEG), and Duke Energy ($DUK).