A look at the day ahead in U.S. and global markets from Mike

Dolan

Cloudy outlooks from U.S. megacaps Microsoft ( MSFT ) and Meta

combined with edgy government bond markets around the world to

unsettle investors on Thursday, with the latest U.S. opinion

polls showing next week's presidential election is no foregone

conclusion.

The week's deluge of events and data releases continued

apace overnight - shaded earnings beats from the latest two of

the 'Magnificent Seven' firms, a Bank of Japan policy rate hold

and a crumb of comfort for Chinese manufacturing.

Europe, meantime, continued to digest above-forecast GDP and

inflation updates from Wednesday, with Britain's tax and debt

raising budget keeping UK government bonds on edge.

UK 10-year gilt yields hit their highest in a

year on Thursday, while euro zone equivalents

touched their highest since July as markets scaled back hopes

for a 50 basis point cut in European Central Bank interest rates

in December.

U.S. Treasuries outperformed by comparison,

juggling a slight headline miss on third-quarter GDP that was

offset by robust consumer spending details and big jumps in

private sector payrolls and home sales. Those data teed up

tomorrow's employment report. Before then, Thursday also sees

the release of the Federal Reserve's favored inflation gauge

from personal consumption expenditures data (PCE).

But U.S. stock futures have been dragged into the red by

renewed anxiety over whether the massive spend on artificial

intelligence by tech giants will deliver profitable results

going forward, with Microsoft ( MSFT ) and Meta both

down 4% ahead of today's bell on their overnight results.

A 10% earnings-related drop in Advanced Micro Devices ( AMD )

on Wednesday and 32% plunge in the shares of Super Micro

Computer ( SMCI ), after Ernst & Young resigned as the company's

accountant, both jarred the AI theme more broadly.

With Apple ( AAPL ) and Amazon ( AMZN ) reporting after the

bell later today, S&P500 and Nasdaq futures were

both down about 1% before the open.

But as Halloween hits, next week's election sucks most of

the oxygen out macro market speculation at this stage.

While financial markets have been leaning to a win for

Republican Donald Trump in recent weeks, and even a possible

clean sweep for the party in Congress, opinion polls continue to

show the contest is too close to call and caution against

premature bets.

With national polls neck and neck still, a new CNN poll on

Wednesday showed Democrat Kamala Harris has a marginal edge over

Trump in swing states Michigan and Wisconsin - with the two tied

in Pennsylvania less than a week before the votes. The poll

showed Harris leading Trump by 48% to 43% among likely voters in

Michigan and by 51% to 45% in Wisconsin.

With Treasuries nervy of what Trump's tax cutting plans

would do to an already bloated government deficit, the poll news

appeared to contain recent yield rises - which have also seen

the 'term premium' on holding long-term debt over short-dated

paper hit its highest in almost a year at 23.5 bps.

Other so-called "Trump trades" also recoiled somewhat -

shares in Trump Media & Technology ( DJT ), Bitcoin and

even gold slipped back while Mexico's peso nudged

up from Thursday's two-year trough.

The dollar was on the back foot after the previous

day's euro gains on the region's GDP release.

The yen strengthened, meantime, as the Bank of Japan

left policy unchanged amid the domestic political hiatus and the

Nikkei ended lower. The BOJ maintained ultra-low

interest rates but said risks surrounding the U.S. economy were

somewhat subsiding, signalling that conditions are falling into

place to raise interest rates again.

Chinese stocks ended slightly higher on Thursday,

led by property shares, as the country's manufacturing

activities returned to growth in October and traders awaited a

key leadership meeting for details on more potential stimulus.

Hong Kong shares closed down.

Euro zone and British shares were lower.

Key developments that should provide more direction to U.S.

markets later on Thursday:

* US September PCE inflation gauge, weekly jobless claims, Q3

wages and benefits, October Chicago business surveys

* US corporate earnings: Apple ( AAPL ), Amazon ( AMZN ), Intel, Uber, Comcast,

Amcor, Eastman Chemical, Conocophillips, Merck, Bristol-Myers

Squibb, Regeneron, Cigna, Estee Lauder, Mastercard,

Intercontinental Exchange, Southern, Ingersoll Rand, Borgwarner,

International Paper, Coterra, Juniper Networks, Entergy, Xcel

Energy, Kellanova, Huntington Ingalls, Wills Towers Watson, WW

Grainger, Eaton, Altria, Linde, IDEXX, CMS Energy etc

* Bank of England Deputy Governor Sarah Breeden speaks; Dutch

central bank governor Klaas Knot and Bank of Spain governor Jose

Luis Escriva both speak