Daily newsletter · Wed 14 Oct 2026
 | Sharespective Wall Street, before morning tea | Daily newsletter Wed 14 Oct 2026 |
 The September Slowdown Plus: Johnson & Johnson beat on profit and still lost 5.73% over its medical devices. |
Good morning. The S&P 500 finished Tuesday almost exactly where it started, down 0.02% at 7,805.83. The NASDAQ Composite slipped 0.15% and the Dow lost 0.33%.
The flat finish hid a busy morning of results. Citigroup and Johnson & Johnson both beat their profit forecasts, and both fell more than 5%. On Tuesday a beat bought you nothing unless next quarter looked better too.
In company news, Bumble jumped 56.58% to US$5.95 after agreeing to be bought by Ithaca Holdings in an all-cash deal worth US$1.3 billion. Elsewhere, Domino's Pizza fell 4.76% after its US same-store sales grew just 0.3% and it cut its full-year forecast. Finally, UnitedHealth slipped 0.2% despite raising its 2026 profit forecast to at least US$20.50 a share.
All that for 1.41 points.
Market snapshot
S&P 500 7,805.83 ▼ 0.02% | | NASDAQ 27,203.53 ▼ 0.15% | | NZX 50 13,749.60 ▼ 0.56% |
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ASX 200 8,783.90 ▲ 0.01% | | Citigroup US$124.53 ▼ 5.60% | | J&J US$248.61 ▼ 5.73% |
| BANKING |
America's big banks beat their forecasts, and Citigroup still fell 5.6%
Citigroup fell 5.6% to US$124.53 on Tuesday. It earned US$2.85 a share in the September quarter, well ahead of the US$2.66 analysts expected.
The trouble was the month of September. JPMorgan Chase finance chief Jeremy Barnum said the bank saw deal-making slow during the month. Wells Fargo's finance chief, Mike Santomassimo, said trading activity slowed meaningfully. Wells shares lost 3.1% after its net interest income came in short of estimates.
Citi's outlook did the most damage. It told analysts to expect markets revenue about 20% lower in the December quarter, possibly a bit more. Its return on tangible equity, a measure of profit on shareholders' money, fell to 11.5% from 13% in the June quarter.
JPMorgan missed outright. It earned US$5.57 a share against expectations of US$5.85, its first profit miss since late 2023. Investment banking fees were 14% higher than a year earlier but 8% lower than in the June quarter, and the shares fell 0.86%.
Goldman Sachs had the strongest quarter of the lot. Revenue rose 23% to US$18.68 billion and stock trading revenue jumped 72%. Its shares still slipped 0.2%.
What to watch whether September was a pause. Barnum called the missing deals delayed rather than cancelled. With the 10-year Treasury yield still above 5%, I'd want to see the listings calendar fill up again before taking that on trust. |
| HEALTHCARE |
Johnson & Johnson beat on profit and fell 5.73% over medical devices
Johnson & Johnson fell 5.73% to US$248.61 on Tuesday. It earned an adjusted US$2.80 a share, ahead of the US$2.76 expected, and raised its full-year outlook.
So why did the shares fall? The medical technology division, which sells surgical tools, heart pumps and replacement joints, grew sales just 2.5% to US$8.64 billion. Investors had expected about US$8.74 billion.
Chief financial officer Joe Wolk pointed overseas. He blamed the Middle East conflict, austerity in Europe and pricing in China. Governments near the conflict, he said, are moving money from health budgets to defence.
The drugs business had a good quarter. Pharmaceutical sales rose 7.7% to US$16.8 billion, led by Tremfya, a treatment for psoriasis and bowel disease, whose sales grew 68%.
J&J also settled on a plan for its hips-and-knees business. It had been reported to be in talks to sell the unit to Apollo Global Management. Wolk now prefers spinning it off as a separate company, partly because buyers would use today's low medical-device valuations against J&J.
The open question whether the slowdown is regional or lasting. Medical devices are about a third of J&J's sales, and a third of the business growing at 2.5% weighs on the whole company however well the drugs sell. |
| CHIPS |
Applied Materials gave no spending forecast, and its shares fell 6.69%
Applied Materials fell 6.69% to US$464.24 on Tuesday. The company makes the machines chipmakers use to build their chips, and it had just held an investor day.
The missing number was the one investors wanted most. Chief executive Gary Dickerson gave no forecast for wafer fabrication equipment spending, the industry's total budget for chipmaking tools. That figure is how investors size up the company's own growth plans.
Dickerson said demand for computing power will keep growing quickly. He also named what sets the pace: factory space, supply chains, and the financing of the energy infrastructure that data centres need.
The rest of the toolmakers followed. Lam Research and KLA each fell about 4%, and ASML, the Dutch maker of lithography machines, lost about 3%.
The mood was already fragile. On Monday in Singapore, Broadcom chief executive Hock Tan said many AI investors have no clue what they are investing in, and likened it to a casino. Chip stocks in Seoul took the worst of it on Tuesday. Broadcom itself rose 0.7%.
Boiled down a skipped forecast tells you the timing is uncertain, and says little about demand. Our read is that the build-out now depends on power stations and buildings as much as on chips, and those are much harder to schedule. |
Newsworthy numbers
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5.46% how far South Korea's Kospi fell on Tuesday, to 6,035.35. SK Hynix lost 10.09% and Samsung Electronics 7.39%. | | 7% the share of American small-business owners who told the NFIB that September was a good time to expand, down five points in a month. |
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US$1.2 million the Nobel economics prize, shared on Monday by Robert Hall of Stanford and Michael Woodford of Columbia for their work on how economies are steadied. | | US$299 the price of HomeView, Apple's first smart-home display, unveiled on Tuesday. It ships on 13 November. |
Worth a read
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01 | A record 82% of Australian home loans now rely on mortgage brokers. Why? — Susan Thorp of Monash University on how brokers went from half of new home loans in 2016 to 81.6% this June. Only the UK and the Netherlands come close. |
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02 | "Attacked by 8 million people": NYC retailer caught in social media storm with Kelly Clarkson over $21,600 sale — David Adams on a Brooklyn magic shop, a US$15,000 mechanical bird that was never for sale, and what a celebrity pile-on did for its profile. |
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03 | Pak'nSave admits its AI-generated KFC recipe was wrong — Chris Schulz cooked the supermarket's billboard recipe. It had no flour and more than three tablespoons of salt, and Pak'nSave added a cup of flour that afternoon. |
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04 | 'Atmospheric rivers' helped open a Portugal-sized hole in Antarctica's winter sea ice — Sam Jarman on a 2024 gap of more than 89,000 square kilometres off East Antarctica, opened by six warm air streams in a row. |
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05 | A Black Fern champion, a brave voice for others: remembering Cheryl Waaka — Louisa Wall remembers a two-time World Cup winner who coached a Northland men's club side and campaigned for earlier bowel screening. |
Wrapping up
China reports its September-quarter economic growth at 3pm Monday in Auckland and 1pm in Sydney. China is the biggest export market for both countries, so dairy and iron ore traders will be watching.
Netflix reports next Tuesday in New York, which is 9am Wednesday in Auckland and 7am in Sydney. Advertising is the line to watch, after Netflix said ad revenue should roughly double this year. Tesla follows a day later, with its call at 10.30am Thursday in Auckland and 8.30am in Sydney.
The kiwi and the Aussie firmed a little. USD/NZD eased to 1.78 and USD/AUD to 1.43.
Twenty-four sleeps until New Zealand votes. See you tomorrow.