Market Wrap | Major Indices Plunge Amid Earnings Shock and Election Jitters as Volatility Climbs

On October 31st, U.S. stocks saw a significant decline as all three major indices closed lower. The S&P 500 index fell 1.86%, ending at 5705.45 points; the Dow Jones Industrial Average was down by 0.90%, closing at 41763.46 points; and the Nasdaq Composite decreased by 2.76%, wrapping up the day at 18095.15 points. A notable highlight was the stock surges with Root climbing 68.91%, Helport AI rising 43.33%, and Alpha Tech Holdings increasing by 39.68%. Conversely, Anika Therapeutics dropped 30.67%, Rocky Brands declined by 26.60%, and Huntington Ingalls Industries fell 26.10%.

Financial markets witnessed a selling frenzy. Following the market opening, major indices plummeted, reflecting broader declines in European markets, where the Europe's STOXX 600 Index saw its losses exacerbate to a 1.5% drop. Analysts attributed Wall Street's downward trajectory to several factors: ambiguous economic data impacting Federal Reserve rate cuts, earnings disappointments from major corporations raising uncertainties for the earning season, and the impending U.S. elections causing some to seek out safer investments.

Earnings reports did not just shock tech sectors but surprised traditional giants as well. Estee Lauder shares experienced a nosedive, maxing out at a 27% intraday plunge, with losses narrowing to over 17% by late trading hours. This drop followed the firm's announcement of withdrawing its 2025 fiscal forecast and reducing dividends, stirring concerns over future operational pressures.

Tech stocks were among the hardest hit, with notables ARM plummeting more than 8%, Microsoft falling 5.8%, and both NVIDIA and Broadcom slipping over 4%. Several other technology giants, including Amazon, Meta Platforms, and Oracle, saw significant downturns, contributing to the industry's broader market retraction amidst these earnings reports.

Moreover, existing market concerns like the U.S. Presidential Elections further accentuated risk aversion. The Chicago Board Options Exchange's (CBOE) Volatility Index rose 11.0%, climbing to 22.61 and surpassing historical averages, indicating rising volatility as the election approaches.

In addition, the market slump affected Chinese stock proxies listed in the U.S., with the Nasdaq Golden Dragon China Index down more than 1.9%. As of late trading, populous Chinese stocks such as Li Auto and XPeng suffered significant setbacks, accentuating the contagion of market sentiment.

Alongside declining equity markets, both gold and silver prices also saw substantial falls. Spot gold fell 2% and COMEX gold futures dropped 2.1%, reflecting the broader bearish sentiment affecting traditional safe-haven assets amid this volatility.

Adding to these market dynamics, changes could be on the horizon for stock trading hours. The New York Stock Exchange announced plans to extend trading hours on its electronic exchange NYSE Arca. Aiming to facilitate extended trading from early morning until late night, this change adds six hours to existing schedules pending regulatory approval. This move responds to evolving trading demands and strengthens competition in the global financial marketplace.