1. Executive Summary
Today’s Dominant Driver: Final verdict on U.S. housing + Fed minutes – Housing Starts and FOMC tone will decide whether the post-HD retail/housing selloff deepens or stabilizes
Key Opportunity: Verified “safe haven growth” and real-economy AI plays – off-price retail $TJX and AI infrastructure names with hard contracts and backlog ($DY, $POWL)
Primary Risk: A housing miss (≤1,300K) plus hawkish FOMC minutes would confirm a housing recession and higher-for-longer rates, extending de-risking in tech/semis and crushing $LOW / $TGT / $WSM guidance
Actionable Headline: Rotate from story-driven AI and housing beta into off-price retail and nuclear/data-center infrastructure: the market now pays only for cash-backed, contract-backed growth
2. The Macro Pulse: Rates & The Economic Calendar
08:30 AM Housing Starts + Building Permits (Exp: 1,340K / 1,355K)
≥1,400K = Surprisingly strong; supports $LOW and housing plays ($BLDR, $DHI, $LEN) but contradicts $HD’s “40-year low housing turnover” narrative. ≤1,300K = Confirms housing recession; very bearish for $LOW, $HD
08:30 AM Trade Balance (Exp: -$61.0B, Prior: -$60.2B)
≥ -$58B (smaller deficit) = Signals improving U.S. manufacturing competitiveness; bullish industrials ($BA, $CAT, $GE) and Trump-tariff beneficiaries. ≤ -$63B (larger deficit) = Confirms consumption strength but manufacturing weakness
10:30 AM EIA Crude Oil Inventories (Prior: +6.41M)
+7M = Confirms weak demand; weighs on $XLE and energy ($XOM, $CVX, $SLB). ≤ +3M (or draw) = Shows resilient demand / effective OPEC cuts; supports ongoing $XLE outperformance
2:00 PM FOMC Minutes (Oct 28–29)
Hawkish (pushback on Dec cut) = $TLT selloff, 10Y yield >4.20%; renewed pressure on tech/growth ($NVDA, $MSFT, $AMZN), rotation into defensives ($XLP, $XLV). Dovish (broad support for Dec cut) =Dec cut odds jump, risk-on but selective, favoring non-bubble growth (healthcare leaders $MDT, $MRK) over frothy AI/mega-caps
3. Earnings & Corporate Action Intel
A. Key Earnings Today (After Close)
$TJX (TJX Companies), Watch for:
· Clear “trade-down” trends as shoppers (esp. Gen Z) shift from full-price to off-price
· 8 straight earnings beats showing very reliable execution
· Holiday sales outlook and margins (theft reduction + limited tariff impact)
Actionable Intel: A beat with upbeat holiday guidance could push $TJX and peers ($ROST, $BURL, $FIVE) higher while adding pressure on traditional retailers ($M, $KSS, $JWN)
$DY (Dycom Industries), Watch for:
· New, higher-margin AI data center electrical work for AWS/Azure/Google
· 4 straight beats (+13% avg) and an $8B backlog (~$4.6B converting in 12 months)
· Any 2026 guidance raise or concrete numbers on AI/data center + BEAD broadband pipeline
Actionable Intel: A strong beat plus detailed AI commentary could strengthen the “AI infrastructure” theme and lift contractors like $MTZ, $STRL, $EME as money rotates from expensive AI software into physical infrastructure
$POWL (Powell Industries), Watch for:
· Management quantifying AI/data center power demand and its share of the $1.4B backlog
· Any evidence that high-margin data center and utility projects support 20%+ growth and its P/E premium
Actionable Intel: Clear confirmation that $POWL is a key winner in data center power could extend post-earnings momentum and support further flows into “power for AI” names like $ETN, $VRT, $GEV
B. Earnings Reactions from Yesterday (Move the Market)
· $HD (Home Depot): –6.02%
Missed EPS and cut FY26 guidance, citing a housing market at 40-year lows and a quiet hurricane season weighing on demand
Implication: Today’s $LOW / $TGT / $WSM earnings carry very high miss and guidance-cut risk. Housing weakness looks structural, not an HD execution issue
· $AMZN -4.43%, $MSFT -2.70%
Rothschild downgraded both to Neutral, arguing Gen-AI requires ~6× the capex to create the same value as cloud 1.0—implying worse long-term economics
Implication: For $DY (Dycom) today, AI data center commentary must be quantified (e.g., visible pipeline, margin detail). The market now demands concrete contracts and profitability, not storytelling
· $SMH (Semiconductor Index) -2.06%, -9.2% week-to-date
Sentiment in semis and AI has flipped from euphoria to skepticism and de-risking, driving broad multiple compression.
Implication: Any tech / semi-linked earnings this morning (e.g., $GLBE, $GFF and similar names) face downside estimate. Defensive consumer winners like $TJX will see outsized relative outperformance as the market desperately searches for “safe haven growth”
4. Critical News
Geopolitical (Saudi / AI):
MBS plans to lift Saudi investment in the U.S. from $600B → $1T; Sec. of State Rubio says the U.S. is working on advanced AI chip sales to Saudi Arabia. Impact: Bullish for AI chip and infrastructure names and data center power/cooling plays ($VRT, $GEV, $VST), reinforcing the AI capex upcycle despite valuation worries
Energy / Nuclear Renaissance:
$CEG secures a $1B DOE loan to restart Crane Clean Energy Center (Three Mile Island) under the “Energy Dominance Financing Program” tied to winning the AI race. The Army also shortlisted 9 bases for microreactors (Janus program). Impact: Confirms nuclear as core AI data center infrastructure. Bullish for nuclear operators ($CEG, $VST), uranium miners ($CCJ, $UEC), and SMR developers ($SMR, $OKLO), with government backing reducing financing risk
Regulatory / Healthcare:
Trump posts that he only supports healthcare sending money directly to people, not insurers; Sen. Cassidy’s plan would redirect ACA subsidies from insurers to consumers. Impact: Overhang for insurers in annual revenues are at risk. Helps explain rotation into “Trump-proof” MedTech/pharma ($MDT, $MRK) and the sector’s +0.5% outperformance
Disclaimer: This document is a synthesis of publicly available information and is for informational purposes only. It does not constitute investment advice. All trading decisions carry risk.
