US stock outlook | Futures of the three major stock indexes soared after Cerebras results surged, US October PPI hits tonight

Pre-market market trends

1. On November 13 (Friday), the futures of the three major US stock indexes rose sharply before the US stock market. As of press release, Dow futures were up 0.06%, S&P 500 futures were up 0.17%, and NASDAQ futures were up 0.05%.

2. As of press release, the German DAX index fell 0.13%, the UK FTSE 100 index rose 0.11%, the French CAC40 index fell 0.01%, and the European Stoxx 50 index rose 0.01%.

3. As of press release, WTI crude oil fell 0.24% to $88.53 per barrel. Brent crude rose 0.19% to $96.00 per barrel.

Market news

Is the safe haven aura malfunctioning? The sell-off in US debt has made a comeback, and Wall Street just breathed a sigh of relief and was frightened. Just as global bond investors are beginning to believe that the worst phase of this year's sell-off has passed, the sharp rise in US Treasury yields has forced them to re-examine this judgment. The multiple factors that have stirred up the world's largest bond market show little sign of abating: stubborn inflation and the Federal Reserve's hawkish rhetoric prepared traders for more aggressive interest rate hikes, while increasing debt supply further increased upward pressure on yields. Even though the turmoil caused by Nvidia stirred up the stock market and risk sentiment, this round of sell-off in the bond market has not stopped, weakening people's expectations that US debt has regained its traditional safe-haven role. This is a sharp reversal of the situation just a week ago — when the Democratic Party won a landslide victory in the US midterm elections, combined with concerns about artificial intelligence (AI), prompted investors to flock to take refuge in US debt. According to strategist Alyce Andres, “when the new round of inflation data was released on Friday, there was still room for continuation of the two-year US bond sell-off.”

Goldman Sachs is optimistic about US stocks in 2027: the S&P 500 will rise 14% in the next 12 months. A team of Goldman Sachs strategists led by Peter Oppenheimer said in a report to clients that the S&P 500 index is expected to rise to 8,700 points in the next 12 months, although they expect the benchmark index's profit growth rate to slow sharply. Since 2026, the S&P 500 has risen 11%. At the time Goldman Sachs made this judgment, the Nasdaq 100 index had fallen 9% from its high in early October. Concerns raised by artificial intelligence (AI) infrastructure construction and the Nvidia corporate governance crisis have dragged down the index. The strategist said that this round of decline has left so-called hyperscalers (Hyperscalers) stock valuations “far below” historical levels. The strategist wrote, “We think the tech sector — especially hyperscale cloud service providers — is relatively defensive. Admittedly, some of the largest companies have turned to net cash outflows, but overall balance sheet metrics such as net debt/equity remain healthy.”

“Inflation is too high”! The Federal Reserve's “three leaders”: The Federal Reserve must continue to act to pull the price level back to 2% in a timely manner. New York Federal Reserve Chairman John Williams, who is the “top three” of the Federal Reserve and has permanent voting rights, said that US inflation is still high, and policy makers must take further action to contain price pressure. Williams said, “Inflation is too high. Even the latest data shows that inflation remains high. We need to gradually introduce policies to ensure that inflation can fall back to the target level of 2% in a timely and sustainable manner.” At the same time, he said the Federal Reserve must “avoid causing unnecessary damage to the goal of full employment.” Williams also said that overall, the economy does not seem to be unbalanced.

Daly: Further interest rate hikes are needed to pressure inflation, and companies are planning to pass on costs by raising prices. San Francisco Federal Reserve Chairman Daly said that in order to further reduce inflation, the Federal Reserve is likely to need to raise interest rates further. She said, “My tendency is to further tighten policies because you can see that inflationary pressure continues, and it is no longer limited to those areas most directly affected by tariffs or oil prices,” she also revealed that more and more companies are considering raising prices. Daly also talked about the impact and prospects of artificial intelligence. She said that AI infrastructure is “unquestionably” driving up price pressure, but since the cost increase is not huge and there is no spillover to other sectors, the impact on overall inflation is currently limited.

Overdraft fees in the US banking sector have risen to a four-year high, and economists are warning of signs of deteriorating consumer health. According to bank data and analysis service provider KBRA Financial Intelligence, the US banking industry collected a total of 1.6 billion US dollars in overdraft fees in the third quarter, an increase of 9.4% over the previous quarter, the highest quarterly level in four years. Some economists see rising overdraft fees as an early warning sign of a weakening economy. Real wages in the US, adjusted for inflation, have continued to fall since April. However, data from Moody's analysis shows that auto loan and credit card overdue rates have not changed much in about a year.

Gold may welcome the $3.3 billion index to adjust positions and buy orders! Societe Generale Bank: Capital will be poured in centrally in January next year. The gold market continued to face pressure, and the price of gold fell sharply, once again falling below 4,000 US dollars per ounce. However, Société Générale believes that the annual rebalance of commodity indices in January next year may bring a wave of concentrated buying of precious metals. The bank's commodity analysts said in a report on Thursday that the price of gold has fallen by more than 9% this year, which may push funds tracking major commodity indices to adjust their positions. Gold is expected to be the biggest beneficiary in the annual rebalance to be carried out from January 8 to 14, 2027. It is expected to receive more than 3 billion US dollars in purchases, and silver may also attract about 2.5 billion US dollars in capital inflows.

Individual stock news

After Hwang In-hoon left, Nvidia (NVDA.US) interim CEO Kress still had to deal with AI financing risks. According to media disclosure, it is said that Hwang In-hoon harshly criticized the current interim CEO Cress at an internal meeting in August of this year. The two previously disagreed over huge AI financing promises, but now Kress must take over this complicated situation. After Hwang In-hoon left office, Cress's top priority was not only stabilizing the company's management, but also evaluating the long-term financial commitments previously formed. The relevant financial commitments disclosed in Nvidia's latest financial report are approximately US$164.5 billion, involving OpenAI data centers, leasing arrangements, and other production capacity guarantee projects. These amounts are promises and potential obligations, and are not equal to cash already paid, but their size has raised investors' concerns about the efficiency of the use of funds. Notably, although Kress internally questioned some of the deals, he publicly defended Nvidia's strategy to provide financing support to the AI industry chain. She said at the end of August that the company is aware of external concerns about revolving financing, but believes that related transactions can bring good returns on equity investment. This means that Kress may not be completely opposed to AI financing, but is more concerned about the balance between guarantee size, transaction risk, and return on capital.

Musk is preparing the largest merger and acquisition in history! Rumor has it that the merger negotiations between SpaceX (SPCX.US) and Tesla (TSLA.US) are progressing, and the deal will be announced in December as soon as possible. According to people familiar with the matter, merger negotiations between SpaceX and Tesla, two of Musk's core companies, are progressing, and the two sides are likely to announce the deal as soon as December of this year. This potential deal is expected to become the largest merger and acquisition in the world's history and reshape the competitive landscape of the global technology industry. People familiar with the matter said the two companies are also discussing the possibility of delaying the announcement of the deal until early 2027. Currently, the boards of directors and advisory teams of the two sides are discussing key matters such as the terms of the merger and the governance structure of the company after the merger. The merger between SpaceX and Tesla will become a landmark transaction in the Wall Street merger and acquisition market, creating a supertechnology group with operations spanning electric vehicles, energy storage batteries, rocket launches, and satellite communications.

SpaceX (SPCX.US) will challenge the rocket's fully reusable technology to try to recover the second stage of the Starship. SpaceX plans to try to recycle the first and second stages of the Starship rocket on Friday, challenging fully reusable technology for the entire launch vehicle system. Previously, rocket recycling was mainly focused on first-stage boosters, while Starships' huge payload capacity made second-stage recycling more economically viable. If the test is successful, it is expected to reduce launch costs and support commercial satellite launches, manned space, and future lunar missions.

Nvidia's rival Cerebras (CBRS.US) hit a record high in Q3 revenue, and cloud business revenue surged 265% year over year. According to financial reports, Cerebras's third-quarter revenue in accordance with US GAAP reached US$210.8 million, a year-on-year increase of 55%, a record high. GAAP cloud computing and other service revenue reached US$141.9 million in the third quarter, up 265% year over year, reaching a record high, accounting for about 67% of the company's total revenue. The core gross margin of the business rose sharply to 46.9% from 16.5% in the same period last year. Under non-GAAP standards, the company's core revenue for the third quarter reached US$230.9 million, an increase of 70% year-on-year, and also reached a record high. Under non-GAAP standards, the company's core net profit for the third quarter was US$29.82 million, with a net loss of US$10.86 million for the same period last year, turning a year-on-year loss into a profit. The company's third-quarter GAAP gross margin was 20%, down from 40.6% in the same period last year, but improved from the previous quarter. Core gross margin was 41%, up from 40.7% in the same period last year. Looking ahead to the fourth quarter, Cerebras expects non-GAAP core revenue to be between US$310 million and US$330 million, with a median value of US$320 million, which is approximately 18% higher than the median analysts' average forecast of US$271.2 million. The company also expects core gross margin of 47% to 49% in the fourth quarter, up from 41% in the third quarter; the core operating margin will be between negative 1% and positive 1%, which means that the company's core business is expected to approach break-even in the fourth quarter. As of press release, Cerebras's US stocks surged more than 17% in the premarket on Friday.

Cisco (CSCO.US)'s Q1 revenue increased 24%, the strongest in 15 years, and AI infrastructure revenue is expected to double to $9 billion. According to financial reports, network equipment giant Cisco's revenue for the first quarter of fiscal year 2027 was 18.52 billion US dollars, up 24% year on year. It was the strongest revenue growth rate in the past 15 years, and was also significantly higher than LSEG's agreed forecast of US$18.1 billion; adjusted earnings per share were 1.40 US dollars, up 40% year on year, higher than the market's agreed forecast of 1.33 US dollars. This is the sixth consecutive quarter that Cisco's earnings have exceeded expectations. The core engine of performance growth is the network business — network revenue for the quarter reached US$11.13 billion, a sharp increase of 43% over the previous year, driving an overall increase of 32% in product revenue. The remaining performance obligation (RPO) rose to $46.17 billion, exceeding market expectations, indicating that order reserves are still strong — this also confirms management's judgment that “the demand cycle is sustainable”. In terms of outlook, Cisco raised its full-year guidance significantly: the revenue forecast for the 2027 fiscal year was raised to US$74.8 billion to US$75.8 billion (previously US$72.2 billion to US$73.4 billion), and the adjusted earnings per share forecast was raised to US$5.47-5.53 (previously US$5.05 to US$5.11). As of press release, Cisco's US stocks fell more than 2% before the market on Friday.

The wave of AI chip expansion continues, and Applied Materials (AMAT.US) Q1 revenue guidance has exceeded expectations. According to financial reports, Applied Materials' Q4 revenue was US$10.41 billion, up about 53% year on year, higher than market expectations of US$10.3 billion; adjusted earnings per share were US$4.16, up about 92% year on year, higher than expected US$4.06. Driven by the expansion of AI chip production, the core semiconductor system business's Q4 revenue reached 8 billion US dollars, an increase of 64% over the previous year. In terms of guidance, the company expects Q1 revenue for the 2027 fiscal year to be about US$11.1 billion (fluctuating up and down US$500 million), higher than analysts' average expectations of about US$10.89 billion; adjusted earnings per share are about US$4.35 (up and down US$0.20), which is also higher than expected. The company determined that strong demand for advanced AI chips will continue to drive investment in semiconductor manufacturing equipment.

Key economic data and event forecasts

US October PPI data at 21:30 Beijing time

At 9:40 Beijing time, 2026 FOMC ticketing committee and Dallas Federal Reserve Chairman Logan delivered opening remarks at the 2026 Bank Financing Conference

22:10 Beijing time 2028 FOMC Voting Committee and Boston Federal Reserve Chairman Collins delivered the opening address at the 70th Economic Conference hosted by the Boston Federal Reserve

23:35 Beijing time 2028 FOMC voting committee and Boston Federal Reserve Chairman Collins was interviewed live on Bloomberg TV

At 23:50 Beijing time, Federal Reserve Governor Bauman attended a seminar

At 00:10 Beijing time the next day, 2027 FOMC voting committee and San Francisco Federal Reserve Chairman Daly delivered a speech

The next day at 08:00 Beijing time, Federal Reserve Vice Chairman Jefferson delivered a speech