For the second consecutive day, stock markets experienced a decline on Tuesday as rising interest rates took precedence over the promising start to the earnings season. The Dow Jones Industrial Average dropped by 88 points, equating to a 0.2% decrease. The S&P 500 and the Nasdaq Composite both saw a retreat of approximately 0.5%. The yield on the U.S. 10-year Treasury note temporarily surged beyond 4.2%, marking a three-month high, before settling back down. This increase in yields has been influenced by cautious statements from Federal Reserve officials regarding the trajectory of interest rate reductions. Minneapolis Federal Reserve President Neel Kashkari suggested on Monday that the central bank might adopt a more conservative strategy moving forward. Interestingly, yields have been on the rise since the Fed's half-point cut a month ago, a trend that can be partly attributed to positive economic indicators and partly to growing skepticism about the Fed's future aggressiveness in cutting rates. According to CME's FedWatch tool, which tracks fed funds futures trading, traders are currently assigning an 89% probability to a quarter-point rate cut at the Fed's upcoming meeting, scheduled for November 7th.

In addition to interest rates, traders are closely monitoring a new round of earnings reports scheduled for release this week. Companies such as Tesla and Coca-Cola are set to report on Wednesday, with Honeywell following on Thursday. As of now, around 19% of the companies in the broad index have announced their results, with more than 70% surpassing earnings estimates, as reported by FactSet. The market has been on an upward trend in October, with the S&P 500 reaching an all-time high and its year-to-date gain exceeding 22%. A loss on Tuesday would mark the first instance of consecutive losing sessions for the benchmark since early September.

Gold, often regarded as a classic "safe haven" asset, has seen its prices skyrocket this year due to escalating geopolitical tensions and increasing macroeconomic uncertainties. Spot gold prices have exceeded $2,700 per ounce and continued their upward momentum on Monday, reaching a new record high of over $2,733 per ounce for the fifth consecutive day. Year-to-date, spot gold has appreciated by more than 30%. In early Tuesday trading, the precious metal's value increased by 0.5%, reaching $2,732.58. In light of this, reached out to several investment professionals for their perspectives on gold. The majority are bullish, with expectations that gold could reach $3,000 per ounce by 2025. However, there is a note of caution regarding the rally, with some expressing concerns about short-term volatility driven in part by speculative investors. John Reade, a senior markets strategist at the World Gold Council trade association, noted that "Declining interest rates will provide a favorable tailwind for the gold market and boost prices over the next six to twelve months. However, short-term volatility is quite possible..."

Premarket trading saw significant movements among certain stocks. Cheesecake Factory's shares increased by more than 3% following the news that activist investor JCP Investment Management had taken a stake in the company and urged it to consider spinning off three of its brands into a separate entity. Conversely, Sherwin-Williams' stock fell by 6.5% after the paint manufacturer reported third-quarter results that fell short of expectations. 3M's shares, on the other hand, jumped by 5% after the industrial company posted third-quarter earnings and revenue that exceeded analyst forecasts.

JPMorgan has advised investors to sell Hertz shares, with analyst Ryan Brinkman downgrading the car rental company's stock to "underweight" from "neutral" and removing his previous price target of $5. Brinkman's decision was influenced by softer travel trends, the potential for a quicker turnover of vehicles, and the company's high financial leverage. Additionally, he pointed to the possibility of litigation costs related to Hertz's previous bankruptcy, which were not factored into the old valuation analysis. Meanwhile, Brinkman considers shares of Avis Budget, which he has rated "overweight," to be "attractively inexpensive." Despite these concerns, Hertz's shares gained about 1% in Tuesday's premarket trading, recovering some ground after a more than 8% drop in the previous session. The stock has plummeted by over 71% in 2024 alone, with shares falling below the $3 mark by the end of Monday's trading.

General Motors' shares rose by nearly 3% after the automaker reported third-quarter results that surpassed analyst expectations and raised its full-year outlook. The company reported an adjusted profit of $2.96 per share on revenue of $48.76 billion, while analysts had anticipated earnings of $2.43 per share on revenue of $44.59 billion. GM also projected its 2024 EBIT to be between $14 billion and $15 billion, an increase from the previous guidance of $13 billion to $15 billion. CFO Paul Jacobson commented, "The consumer has held up remarkably well for us, and nothing we see has changed from where we've been for the last several quarters."

Loop Capital has initiated coverage of AppLovin with a "buy" rating and a price target of $181, suggesting a potential 13.9% increase from Monday's closing price. This target is the highest on Wall Street, according to LSEG. Rob Sanderson, managing director of the investment bank, praised AppLovin's role as indispensable infrastructure for the mobile gaming industry and its potential as a big data and AI play for investors. Sanderson noted that despite its sizable market cap and impressive growth, the stock was relatively undiscovered and largely misunderstood until recently. He drew parallels between AppLovin and The Trade Desk, a top pick from Loop for 2024, but acknowledged that AppLovin already has a larger and faster-growing software business with higher margins. Sanderson advised investors to look for opportunities to buy on any price dips, stating that the stock's re-valuation is both "warranted" and "sustainable."

Jefferies has revised its outlook for Tesla shares, with analyst Philippe Houchois raising his price target by $30 to $195, implying a potential decline of 10.9% over the next year from Monday's closing price. Houchois maintains a "hold" rating on the electric vehicle maker, citing higher expectations for revenue, free cash flow, and EBIT between 2024 and 2026. He noted that attention has shifted back to the business following Tesla's robotaxi event, which "fell a bit flat," and expressed concerns about governance and funding. Houchois also highlighted a "stabilization" in the automotive sector that has aided the company in the third quarter.

Asian markets mostly declined on Tuesday, following a mixed performance on Wall Street. Investors had a relatively quiet day in terms of economic data from Asian countries but closely watched Hyundai Motor India as it began trading following a record IPO in India. Shares were trading down 4.42% at 1,873 rupees from their initial public offering price of 1,960 rupees, according to BSE data. The automaker had offered 142.19 million shares at a price band of 1,865 Indian rupees ($22.18) to 1,960 rupees, raising 278.56 billion rupees, or $3.3 billion, with shares priced at the top end of the range.

European stock markets were mixed in early trading, with the Stoxx 600 index, which fell by 0.66% on Monday, down by another 0.1% at 8:35 a.m. in London. The U.K.'s FTSE 100 and France's CAC 40 were both lower, down by 0.28% and 0.11%, respectively, while Germany's DAX managed a gain of 0.55%.

Overnight trading on Monday saw significant movements among certain stocks. Nike's shares added less than 1% after the company renewed its uniform partnership with the NBA and WNBA. Zions Bancorporation's regional bank stock rose by 4% on stronger-than-expected third-quarter results. Nucor, the steel production company, declined by more than 2% despite posting adjusted earnings and revenue that exceeded expectations in the third quarter.

Stock futures opened with minimal changes on Monday evening. Dow futures edged up by 8 points, while S&P 500 futures and Nasdaq-100 futures remained near the flatline.