US stock outlook | Futures on the three major stock indexes are rising, the Democratic Party takes back control of Congress, boosts risk appetite, and quarterly refinancing announcements are about to be released

Pre-market market trends

1. On November 4 (Wednesday), the futures of the three major US stock indexes rose sharply before the US stock market. As of press release, Dow futures were up 1.55%, S&P 500 futures were up 1.13%, and NASDAQ futures were up 0.97%.

2. As of press release, the German DAX index had risen 1.36%, the UK FTSE 100 had risen 1.16%, France's CAC40 had risen 1.49%, and the European Stoxx 50 had risen 1.85%.

3. As of press release, WTI crude oil fell 0.78% to $95.34 per barrel; Brent crude fell 1.18% to $102.38 per barrel.

Market news

The Democratic Party took back control of the National Assembly in the midterm elections. The “blue wave” boosted risk appetite, and US stock futures reversed and turned upward. According to reports, the Democratic Party suppressed the Republican Party in the US midterm elections and is expected to take back control of the Senate and House of Representatives. Many media have called the situation a “blue wave” or even a “blue tsunami.” Influenced by clarifying election conditions and expectations of the end of a “divided Congress”, the futures of the three major US stock indexes reversed their deep V and changed from decline to rise; analysts believe that the congressional power pattern rewrote or weakened the Trump administration space, and that the decline in uncertainty after the election was beneficial to the return of exit capital to risky assets, but expectations of tax increases and regulatory tightening also put pressure on some sectors.

The US Treasury will issue a quarterly refinancing announcement at 21:30 The key focus of the US Treasury's quarterly refinancing announcement is the scale of medium- and long-term treasury bond issuance and future guidance. The market generally expects the scale of coupon auctions to remain unchanged in the short term, but investors are concerned about whether the Ministry of Finance will release a signal to cut the issuance of 20-year and 30-year treasury bonds in 2027. If the supply of long-term bonds decreases, it may help ease the upward pressure on long-term yields; if short-term debt financing continues to be relied upon, it may boost short-term yields and increase fluctuations in the maturity structure of US bonds. The relevant impact also depends on financial financing needs and investors' ability to afford it.

Spot gold returned above $4,000, and silver rose more than 4%. The safe-haven recovery resonated with the fluctuation of the US dollar. On Wednesday, London Gold is now up 2.62%, and Bank of London is now up 4.22%. Spot gold quickly recouped the $4,000 mark it had lost on the previous trading day. The price of gold fell on the last trading day due to optimistic expectations and the cooling of safe-haven negotiations between the US and Iran. Today, due to the combination of election uncertainty, dollar fluctuations, and the aftermath of the Middle East geography; silver is more flexible, rising more than 4% in a single day. The market focuses on the upcoming US employment and service sector data to determine the future direction of real interest rates and precious metals.

Trump: Democrats will submit crazy bills, and I will veto them. According to reports, US President Trump has begun issuing a warning to the Democratic Party by wearing a bright red hat with only one word on it: “veto” (VETO). As the Democratic Party seeks to regain control of Congress, Trump signals that he intends to use one of the president's most powerful powers — to veto legislation he opposes. In an interview with Fox News, Trump said, “They will submit some extremely ridiculous bills, and I will veto them.” He anticipates that repeated use of the veto power may eventually force the Democratic Party back to the negotiating table. However, Trump said that contacts between the two sides may have already begun. He revealed that since the election ended, several Democrats have taken the initiative to contact him.

In anticipation of the Democratic Party's victory, capital bets on clean energy stocks rebounded, and options trading volume soared. As the market predicts that the Democratic Party will win a major victory in the US midterm elections to be held on Tuesday, traders are investing in a group of stocks commonly classified by investors as beneficiaries in a left-wing administration environment, including clean energy stocks. Invesco Solar ETF (TAN) options trading volume soared to 40 times normal levels on Tuesday, according to Cboe LiveVol. The fund usually traded less than 500 options contracts per day in the past month, but as of Tuesday afternoon trading, the volume had exceeded 20,000, 99% of which were call options.

The situation between the US and Iran has eased marginally, but the risk in Hormuz has not been resolved: Trump says there are no plans to attack yet, and Iran claims that 4 oil tankers have been hit by lightning. On November 3, local time, Trump said that the US currently has no plans to launch an immediate military strike against Iran, but preparations are made if necessary; Iran's Revolutionary Guard Corps claimed that four “illegal” tankers triggered landmines while crossing the prohibited navigation zone in the southern Strait of Hormuz. The diplomatic channels between the US and Iran are still in touch, and the Qatari mediator said the two sides are considering the latest proposals. Affected by this, international oil prices fluctuated slightly.

DRAM prices reached a new high in October Agency: the trend of price increases continued in the fourth quarter. In October of this year, the average price of global DRAM contracts once again reached a record high, while the average price of NAND flash memory continued to be the highest price last month. The agency predicts that in the fourth quarter of this year, DRAM prices are expected to rise sequentially, while in terms of NAND flash memory, the price trends of MLC flash memory and SLC flash memory will diverge.

Individual stock news

AMD (AMD.US) Q3 revenue recorded a record 45% increase, data centers nearly doubled, and rose more than 6% before the market. AMD announced Q3 results for the 2026 fiscal year after the market on November 3: revenue of US$13.38 billion increased 45% year over year, reaching a quarterly high of US$13.09 billion, higher than the forecast of US$13.09 billion; adjusted EPS of US$2.09 was higher than the forecast of US$1.95. Looking at the breakdown, data center revenue of 8.55 billion US dollars increased 97% year over year, accounting for 64% of total revenue (47% last year), operating profit margin 34%; client and game revenue of 3.7 billion US dollars decreased 8% year over year (games fell 40%), and embedded increased 29%. The company expects Q4 revenue of about $17 billion (± 3%) higher than the forecast of $16.3 billion, and the gross margin guide is about 55%. CEO Su Zifeng said that server revenue will double in 2027, and 80% of sales next year will come from data center chips. After the market, the stock price once rose by more than 9%, and by more than 6% as of press time.

Ultra Micro Computer (SMCI.US)'s Q1 revenue nearly tripled to US$19.9 billion, surpassing expectations and rising more than 9% before the market. Ultramicrocomputer announced Q1 results for the 2027 fiscal year after the market on November 3: revenue of 19.9 billion US dollars increased about 3 times year-on-year, far exceeding expectations of 16.4 billion US dollars; adjusted EPS of 1.81 US dollars was far higher than the forecast of 1.23 US dollars. Benefiting from the explosion in demand for AI servers, the company raised its Q2 revenue guidance to US$19.5 billion to US$19.5 billion (higher than the forecast of US$17.1 billion) and raised its revenue forecast for the full year of the 2027 fiscal year from US$65 billion to US$72 billion to US$72-82 billion. However, GAAP and non-GAAP gross margins are only about 12.8%, and profitability is still the focus of follow-up attention; the company previously received attention due to financial reporting and accounting issues. Mark Long, a former Western Digital executive, was appointed as CFO last month, and the pre-market stock price rose more than 9%.

Qualcomm (QCOM.US) will release an after-market earnings report tonight. Weak smartphones and loss of Apple (AAPL.US) are suppressing expectations. Qualcomm announced Q4 results for the 2026 fiscal year after the market on November 4. Wall Street expects revenue of about US$10.14 billion (down about 10% year on year) and EPS of about US$2.16 (down 28% year on year, US$3.00 in the same period last year). The pressure comes from weak demand for smartphones, loss of related revenue due to accelerated replacement of Apple's self-developed modems, and rising wafer/memory/packaging costs squeezing gross profit margins; the company also recently announced global layoffs. Arm (ARM.US), AppLovin (APP.US), and Coherent (COHR.US) were also on the list on the morning of the same day. The differentiation between AI and terminal requirements will be tested centrally, and the market will focus on management's guidance for Q1 and fiscal year 2027.

Tesla (TSLA.US) fell more than 4% in the premarket, with the Republican Party losing the election and South Korea's FSD complaints. Tesla's pre-market decline was significantly weaker than most big tech stocks. There are two direct catalysts: First, many US media predict that the Democratic Party will take back control of Congress and the loss of the Republican Party. The market is worried that Musk (the largest individual financier in this election, has donated 445 million US dollars) will be “liquidated” by politics. Although Trump stated that “he will protect Musk,” risk aversion still suppresses his Tesla and SpaceX (SPCX.US) (which fell more than 4% before the market); second, reports that a rights protection organization complained to tens of thousands of consumer regulators that FSD assisted driving could not be used legally in South Korea. Short-term political and regulatory variables amplify stock price fluctuations.

Meta (META.US) plans to issue 20 to 25 billion US dollars in debt, and the wave of debt financing from tech giants continues. According to reports, Meta has launched a new round of bond issuance and plans to raise a total of 20 billion to 25 billion US dollars in the US and Europe, of which US dollar bonds are about 15 billion US dollars, for the first time in six months. Against the backdrop of high interest rates and a surge in AI capital expenditure, large technology companies clearly intend to lock in long-term low-interest liabilities and support computing power and data center investments; previously, many giants were also supplementing their ammunition by issuing bonds. Analysts believe that although this move relieves short-term financial pressure, it also boosts future interest burdens. High leverage and high valuation are superimposed or amplified sector fluctuations.

Google (GOOGL.US) plans to invest $15 billion to expand its data center business in Malaysia. Google said it plans to invest $15 billion to expand its data center and cloud computing business in Malaysia to meet digital infrastructure needs driven by the AI boom. According to a statement issued by the company on Wednesday, Google will build a new computing center and invest in local water security, electricity production, and skills training for Malaysian residents. The relevant investment plan will be implemented between 2027 and 2028.

The Texas gubernatorial election results boosted data center risks, and US data center operators and cloud computing concept stocks fell before the market. Applied Digital (APLD.US) fell 2.36% premarket, Core Scientific (CORZ.US) down 2.95%, IREN (IREN.US) down 2.58%, TeraWulf (WULF.US) down 0.37%, Coreweave (CRWV.US) down 2.42%, and ORCL.US (ORCL.US) down 1.74%. According to reports, the Texas Democratic Party candidate Gina Hinojosa is expected to be elected governor of Texas in the middle election. Texas is expected to account for about a quarter of America's new data center capacity by 2030. Hinojosa supports the suspension of data center project construction, which may put the 13.3 gigawatt project already announced locally at risk.

Apple warns that AI agent behavior may be difficult to predict, which may cause lawsuits and damage the company's reputation. Apple said in its annual financial filing on Tuesday that artificial intelligence (AI) agents that can act in “unexpected or unpredictable ways” could pose a threat to its business because it would expose the company to lawsuits or damage its reputation. According to reports, the new risk factors listed in the documents submitted by Apple indicate the disruptive potential of artificial intelligence agents, and such agents have quickly become a matter of great concern for major Silicon Valley companies.

Key economic data and event forecasts

21:15 Beijing time: The number of ADP employees in the US in October

21:30 Beijing time: US trade balance for September, Canada's trade balance for September, and the US Treasury issued quarterly refinancing announcements

23:00 Beijing time: US ISM non-manufacturing PMI for October

23:30 Beijing time: US EIA crude oil inventory for the week from October 30

Performance Forecast

Thursday morning: Arm, Qualcomm, AppLovin, Coherent

Thursday pre-market: Toyota (TM.US), Sony (SONY.US), ConocoPhillips (COP.US)