Closing Bell: Palantir Tops Estimates, OpenAI Expands with AWS

Key Points

• Markets closed mixed, with gains in the S&P 500 (SPX) up 0.17% and the Nasdaq-100 (NDX) rising 0.44%.
• OpenAI and AWS have launched a $38 billion strategic partnership to run workloads on AWS infrastructure
• Kimberly-Clark (KMB) announced a $48.7 billion cash-and-stock deal to acquire Kenvue (KVUE)

Markets closed mixed, with gains in the S&P 500 (SPX) up 0.17% and the Nasdaq-100 (NDX) rising 0.44%. However, small caps lagged, as the Russell 2000 (RUT) declined by 0.33%. Leading sectors included Consumer Discretionary and Information Technology, while Materials, Financials, and Consumer Staples underperformed.

Another day of market concentration was evident when considering market breadth, with just over 35% of S&P 500 stocks closing in positive territory. Amazon gave a much-needed boost to the consumer discretionary sector following its announcement of a deal with OpenAI. Federal Reserve commentary was front and center, as Governor Stephen Miran continued to advocate for a sharp reduction in interest rates, stating, “If the Fed maintains a restrictive stance of policy, it increases the chance that monetary policy will cause a downturn.” Meanwhile, Fed Governor Lisa Cook made her first public remarks since facing mortgage fraud accusations, expressing concern over labor market weakness. She noted, “Hiring is slowing according to numerous real-time sources; we don’t need the employment report to see that,” reinforcing her support for further rate cuts.

Amazon Announces Multiple Partnerships

OpenAI and AWS have announced a multi-year strategic partnership worth $38 billion. OpenAI will begin running workloads on AWS infrastructure, which comprises thousands of Nvidia (NVDA) chips. This partnership will start immediately, with additional capacity to be added over time. Amazon also announced an expansion of its partnership with Verizon Business, along with a $5.5 billion lease agreement with Cipher Mining (CIFR). 

Kimberly-Clark to Acquire Kenvue (KVUE) in Strategic Deal

Kenvue (KVUE) shares rose today following news that Kimberly-Clark (KMB) announced a buyout deal valued at approximately $48.7 billion, structured as a mix of cash and stock. Kenvue has recently faced pressure due to scrutiny from the Trump administration over its Tylenol business line. The acquisition is expected to create one of the largest personal care and health companies globally.

Palantir Beats Market Expectations

Palantir (PLTR) reported strong Q3 results, with U.S. revenue rising 77% year-over-year and 20% quarter-over-quarter to $883 million. U.S. commercial revenue surged 121% year-over-year and 29% quarter-over-quarter to $397 million, while U.S. government revenue increased 52% year-over-year and 14% quarter-over-quarter to $486 million. The company posted adjusted earnings per share of $0.21, beating the consensus estimate of $0.17, and revenue of $1.18 billion, surpassing the $1.09 billion forecast.

Key Market Events for Tomorrow

• 6:35 AM ET: FOMC Member Bowman Speaks
• 4:30 PM ET: API Weekly Oil Inventory Report

Notable Earnings for Tomorrow

• Premarket: BP, MAR, TAP, NCLH, PFE, SHOP, SPOT, UBER, YUM
• Postmarket: AMD, ANET, CAVA, LYV, LITE, MTCH, PINS, RIVN, SMCI