US close: Markets mixed, but Dow hits one-month high
US stock markets were mixed again on Tuesday, with the Dow surging 1% on the back of some well-received earnings, while the S&P 500 and Nasdaq were more subdued on the back of fragile sentiment in the AI sector.
A flurry of corporate earnings was keeping investors busy, with 3M, Equifax and Hasbro impressing with earnings, while GM and GE Aerospace disappointed.
The Dow gained 1.02% to hit a one-month high, while the S&P 500 rose 0.28% and the Nasdaq slipped just 0.02%.
Oil prices were also in focus after Iran‑backed Houthi forces stepped up attacks on Saudi infrastructure, including airports, Aramco sites and the Shaybah oilfield, stoking concerns over potential Middle East supply disruptions, though expectations of increased Russian exports helped cap gains. Front-month Brent crude settled 0.7% lower at $108.79 a barrel, while WTI crude fell 0.7% to $97.82.
Mixed signals regarding US-Iran negotiations were also complicating matters, according to Patrick Munnelly, partner of market strategy at Tickmill Group.
"Early optimism around a peace proposal submitted by the Pakistani army chief briefly weakened crude and boosted equities, but sentiment rapidly shifted after a senior diplomat involved in the talks clarified that reports of an imminent deal were incorrect," he said.
In equity news, industrial conglomerate 3M raised its full-year adjusted earnings forecast to between $9.10 and $9.15 per share, after Q3 adjusted EPS increased 12% year-on-year to $2.50, while adjusted organic sales grew 3.3%.
Credit reporting group Equifax reported a 10% increase in third-quarter revenue to $1.69bn, supported by broad-based growth across its businesses. US mortgage revenues increased 15% despite what the company described as a challenging market, while revenues from its diversified markets businesses rose 8%.
Toymaker Hasbro raised its full-year financial outlook and doubled its share repurchase target after delivering a fourth consecutive quarter of double-digit revenue growth. Its Magic: The Gathering franchise generated more than $600m in quarterly revenues for the first time, with chief executive Chris Cocks pointing to a strong product pipeline and continued momentum heading into 2027.
Heading the other way was GE Aerospace despite lifting its full-year outlook after an 18% jump in adjusted quarterly revenues. GM also dropped despite news of a new $20bn share buyback following a strong third quarter.
Meanwhile, AI‑linked stocks were drawing investor attention as stocks extended a global sell-off that has swept through the sector since late-September, as traders increasingly question the near‑term profitability of the AI trade after heavy investment commitments for 2026 and beyond.
On the macro front, US housing starts and building permits both softened in September, according to the Census Bureau, offering another weak read on construction activity as higher mortgage costs continued to weigh on builders. Housing starts fell 5.2% to an annualised 1.22m, the lowest level since May, while permits dipped 0.2% to 1.4m, though slightly above expectations.
Meanwhile, US pending home sales dropped 7.3% in September to a record low, according to the National Association of Realtors, well below the -0.5% expected by analysts.