Here are the most important news items that investors need to start their trading day:
1. Rolling along
The Nasdaq and the S&P 500 are on their longest winning streaks in almost two years after finishing higher Tuesday. The Dow, meanwhile, is on its longest positive streak since July. The gains come as Treasury yields ease a bit from recent highs as the Federal Reserve continues to hold pat on rates and recent jobs data indicate some economic softening. Investors are also keeping an eye on earnings, with a few big names left to report – including Disney on Wednesday, and Walmart and Target next week – as the season winds down. Follow live market updates.
2. All eyes on Disney
Disney and its CEO, Bob Iger, are in search of a win. Iger has been back about a year, and investors are eager to see if and when his restructuring of the company will actually pay off. Right now, they're not impressed. The stock is down slightly on the year, compared to broader market gains. That softness has drawn activist investor Nelson Peltz and his firm, Trian, back into the fray. Powered by shares owned by former Marvel boss Ike Perlmutter, a longtime Iger antagonist, Peltz and Trian are waiting to see what happens with Wednesday's earnings report before making a move, CNBC's Alex Sherman reports. If Peltz doesn't like what he sees, he could launch a proxy fight for board seats. (Tune in to CNBC's "Closing Bell: Overtime" at 4:05 p.m. ET, when Julia Boorstin will interview Iger.)
3. AI-powered record for Microsoft
Microsoft's stock hit an all-time high Tuesday, riding a wave of optimism over the company's artificial intelligence prospects. Microsoft has invested $13 billion in startup OpenAI, whose ChatGPT app has become synonymous with the surge in AI popularity. Wall Street sees the partnership as a boon for Microsoft's Office products, as well as its Azure cloud business. Indeed, Microsoft CEO Satya Nadella this week touted Azure as a way to help developers using OpenAI tech quickly get their products to market. "What is good for OpenAI is good for Azure in our view," UBS analysts said in a note Monday.
4. Mortgage demand shows a pulse
Seems simple enough: interest rates go down and mortgage demand goes up. That's what happened in recent days as mortgage rates had their biggest one-week decline in over a year, leading to the first jump in home-loan demand in a month, CNBC's Diana Olick reports. The recent surge in Treasury yields fueled even higher mortgage rates, pushing the popular 30-year fixed to over 8% at one point. Yields have come down, though, as the Federal Reserve held off on another benchmark rate hike and jobs data for October came in softer than expected. Whether the housing market can generate any momentum remains to be seen. Prices are still high, and supply remains tight.
5. Election Day tea leaves
It was an off-year election, with an emphasis on state races, but Tuesday's results could potentially tell us a lot about what's going to happen next year, when President Joe Biden is expected to stand for reelection. Biden's poll numbers are in the dumps, and there are growing calls for him to step aside. But strong Democratic showings this week gave the president something to crow about: Democratic Gov. Andy Beshear of Kentucky won reelection in the red state, defeating a candidate endorsed by likely Biden rival Donald Trump, while voters in Ohio enshrined the right to an abortion. In Virginia, meanwhile, voters gave Democrats control of both chambers of the statehouse, dealing a blow to Republican Gov. Glenn Youngkin – who's been hyped as a potential GOP presidential candidate himself.
– CNBC's Lisa Kailai Han, Alex Sherman, Jordan Novet, Diana Olick and Spencer Kimball contributed to this report.
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