Elon Musk's SpaceX helps launch stock market gains

Key takeaways by Insider Paper

SpaceX reported its first quarterly profit as a public company, $4.4 billion, beating expectations; shares rose more than 10 percent.
Revenue jumped 161 percent to $14.6 billion after a record IPO, lifting tech stocks and pushing the Nasdaq up about 1 percent.
Clear earnings beats and corporate updates from SpaceX and Super Micro helped ease AI anxiety, supporting firms like CoreWeave and Nebius.
Markets await Meta and Tesla earnings; similarly strong results could reignite broader AI enthusiasm and sustain sector momentum.
Paris saw extremes: EssilorLuxottica surged over 16 percent, Carrefour plunged 13 percent after protests, and France 10-year yield topped 5 percent.

Stock markets mostly rose Wednesday, with sentiment boosted by news that Elon Musk’s SpaceX reported its first quarterly profit as a publicly traded company.

The announcement, which followed the close of Tuesday’s trading on Wall Street, helped push up technology stocks in particular.

Shares in SpaceX jumped more than 10 percent in morning trading in New York, while the tech-heavy Nasdaq Composite advanced one percent.

SpaceX’s net profit of $4.4 billion for July-September was more than double what analysts had expected and compared with a loss of $1.1 billion a year earlier.

Revenue at the firm — which listed after a world-record initial public offering in June — soared 161 percent to $14.6 billion.

“SpaceX delivered some impressive earnings results and guidance, to go along with a pronouncement that it could rent out its AI compute capacity many times over if it was able,” said market analyst Patrick O’Hare at Briefing.com.

“That was relief music to the ears of investors in the likes of CoreWeave and Nebius,” he added.

Shares and bonds of firms like CoreWeave, which have borrowed heavily to build AI data centres, took a beating last week as investors worried that high interest rates could sink their business models.

Server-maker Super Micro Computer also provided a fillip to buying sentiment when it said preliminary quarterly earnings had come in better than forecast.

The developments soothed worries on trading floors about the outlook for the AI boom, which has seen companies pump hundreds of billions into research and development of software, data centres and other hardware.

“Clear earnings beats and constructive corporate updates are helping to ease some of the AI anxiety that has surfaced in recent sessions,” said KCM Trade analyst Tim Waterer.

The next test of AI anxiety will be Wednesday evening, when Tesla and Facebook parent Meta report their results after Wall Street closes.

“If (Meta and Tesla’s) reports deliver similarly strong results and guidance, it could go some way toward reigniting broader AI enthusiasm and giving the sector more sustained momentum,” Waterer said.

Chris Beauchamp, chief market analyst at online trading and investing platform IG, said Meta’s AI model has been well received by investors but that it will likely need to keep spending to keep up with competitors.

“The trick will be in convincing skittish investors that splashing the cash will deliver the long-term growth it needs,” he said.

The Paris stock market added 1.1 percent amid some extreme movement among individual stocks.

EssilorLuxottica soared more than 16 percent after the world’s top maker of eyeglasses announced late Tuesday a 24 percent jump in sales of lenses that help slow short-sightedness in children.

But supermarket giant Carrefour plunged more than 13 percent after it warned that the recent violent protests across France would dent profits.

Chief executive Alexandre Bompard said around 50 Carrefour stores were looted over the weekend, and it expects operating profit will be cut this year by 80 million to 200 million euros ($90-$225 million) as a result.

The yield on France’s benchmark 10-year government bond meanwhile rose and closed above five percent for the first time since 2002, as investors demanded a higher return for holding the country’s debt amid a budget standoff and the protests.