[U.S. Market Recap] Sept 24: Dow Falls 161 Points for a Third Straight Day as 10-Year Yield Hits 5.19%, Meta Jumps 4.5% While Oracle Slides

Hey everyone, Hirokichi here.

Wall Street ended mixed on September 24. The Dow fell 161 points to 51,349 for a third straight decline, the S&P 500 was basically flat, and the Nasdaq Composite eked out a 3-point gain. With the 10-year Treasury yield climbing to 5.19%, its highest since 2007, Meta (META) jumped 4.5% on hopes for its AI agent, while Oracle (ORCL) slid 3.5% after a “force majeure” notice on a data center project. Even within AI, it was a day of clear winners and losers.

The Three Indexes: Dow Down for a Third Day, Nasdaq Barely Higher

Here are the closing numbers for the three major indexes.

Sources: Yahoo Finance, Fisco (via Kabutan). The moves were small across the board, which tells us neither buyers nor sellers had a clear edge.

Stocks opened lower on worries that high oil prices will stick around and on rising long-term yields. Later, Reuters reported that the U.S. and Iran are exploring a phased deal that includes reopening the Strait of Hormuz, and buyers stepped back in to trim the losses.

The Nasdaq only managed to get back into positive territory because big tech names like Meta and Alphabet (GOOG) were bought. Meanwhile, Nvidia (NVDA) fell 0.41%, Microsoft (MSFT) lost 0.53%, and the Philadelphia Semiconductor Index (SOX) slipped 0.33%, so chip stocks were soft. The VIX (often called the “fear index”) rose to 15.67 from 15.18 the day before.

My take: it still feels like a tug-of-war. High rates are capping the upside, while hopes for peace in the Middle East are holding the market up.

What Moved the Market: a 5.19% 10-Year Yield, Rate-Hike Talk, and the Middle East

The 10-year yield hits its highest level since 2007

Rates were the biggest weight on the day. The 10-year Treasury yield rose 7.8 basis points to 5.192%, the highest since 2007 (TheStreet). The 30-year yield reached 5.476%, the highest since 2004.

Strong economic data and rate-hike expectations are behind this. Weekly initial jobless claims came in at 197,000, below the 201,000 forecast, and August new home sales jumped 6.4% to an annual pace of 684,000, well above estimates. The September PMI (purchasing managers’ index, a survey of business conditions) released the day before was also the strongest in five years. All of this is feeding the view that “the economy is too strong for inflation to cool down.”

Fed officials added to that mood. Philadelphia Fed President Anna Paulson said “some modest further tightening may be warranted.” The Fed just raised rates in September for the first time in three years, and the market is now starting to price in one more hike.

The Middle East, oil, and the U.S.-China summit

Oil stayed high. WTI crude futures (November contract) rose $2.77 (+3.01%) to settle at $94.93 (Fisco). Iran warned of opening “a new front” against Red Sea energy supplies, and a commercial vessel was struck in the Strait of Hormuz, pushing oil as high as $96.78 during the session.

On the other hand, the leaders of the U.S. and China met at the White House, and Treasury Secretary Bessent said the two sides agreed to extend their trade truce by two months. There was no big surprise, but the fact that the two countries keep talking is a positive. The dollar closed at 158.90 yen, and higher U.S. rates continue to support the dollar.

Stocks in the Spotlight: Meta Surges, Oracle and TD Synnex Tumble

Here’s a chart of the day’s biggest movers.

The gap between winners and losers was huge, which shows how much individual stocks moved beneath the calm surface of the indexes.

Sources: Fisco, Motley Fool, Benzinga, TheStreet. Let’s look at why each one moved.

Meta (META): +4.50% as its AI agent finally shows a path to profit

Meta rose 4.50% to $777.59. The trigger was its annual Connect event. Meta upgraded Muse, its AI agent (an AI that can shop, book appointments, and handle tasks for you), and announced a small handheld device called Meta Charm that ships this holiday season. It also revealed retail partners such as Walmart and Best Buy.

The stock rose because CEO Mark Zuckerberg clearly explained how Muse will make money: it will “take a small fee from transactions.” Whether huge AI spending will actually pay off is the market’s biggest question, and Meta gave a concrete answer. JPMorgan raised its price target from $820 to $920, calling Muse “the most widely used consumer AI application since ChatGPT.” That said, the stock is up about 22% since September 8, so I’d keep an eye on short-term overheating.

Oracle (ORCL): -3.47% as the focus shifts from AI orders to execution

Oracle fell 3.47% to $139.54 on volume of 56.5 million shares, about 1.7 times its three-month average (Motley Fool). According to Bloomberg, Oracle sent a force majeure notice to the developer of Project Jupiter, a huge data center being built in New Mexico. A key gas pipeline has been delayed to February 2027, and the notice lets Oracle defer payments if the facility isn’t running by 2028.

Oracle’s move is largely a legal precaution, but the stock fell because investors are now asking a different question. It’s no longer “How big are the AI orders?” but “Can these projects be finished on time and pay back the money?” Oracle is funding its data center buildout with a lot of debt, so any delay quickly raises financial worries. In fact, its CDS (credit default swaps, a kind of insurance against default) reportedly hit a record high.

MGM Resorts (MGM): -9.98% as the takeover premium disappears

Casino operator MGM Resorts dropped 9.98% (TheStreet). Barry Diller’s People Inc. withdrew its $48.30-per-share bid, worth about $18 billion. People said the deal’s components “weren’t coming together as hoped.”

When a company has a takeover offer on the table, its stock tends to trade near the offer price. Once the offer is gone, that extra cushion (the takeover premium) disappears, so a sharp drop is a natural reaction. Bank of America also cut the stock to Neutral, which added to the selling.

TD Synnex (SNX): -12.40% despite a big earnings beat

IT distributor TD Synnex plunged 12.40% to $252.19, even though its results were excellent. Adjusted EPS (earnings per share) was $5.68, 21% above the $4.70 estimate, and revenue of $21.56 billion beat forecasts by 14%. Its guidance for next quarter was also above expectations (Benzinga).

So why the selloff? The details worried investors. Its data center unit, Hyve, grew so fast that about $1 billion of cash got tied up in inventory, and free cash flow (the cash left over from the core business) came in at negative $975.6 million. Gross margin also slipped to 6.61%. In my view, this is a classic case of “sales are growing, but profits and cash aren’t keeping up.”

Everpure (P): +18.68% after laying out its growth plan in numbers

Among smaller names, Everpure soared 18.68% (TheStreet). At its investor day, the company guided to fiscal 2028 revenue of $7.0 to $7.3 billion (39% to 45% growth), showing a clear path to “sustained and accelerating growth.” When rates are high, companies with uncertain growth tend to get sold, while those that can back up their growth with numbers attract money. I think this move captured that trend well.

Sectors and ETFs: Communication Services Up, Utilities and Materials Down

Here’s how sectors performed across all U.S.-listed stocks (Finviz).

Communication services, which includes Meta and Alphabet, led the way, while rate-sensitive utilities and consumer staples were sold.

What caught my eye is that utilities have fallen 4.56% over the past week. Utility stocks pay high dividends, but when rates rise, bonds start to look more attractive and these stocks tend to get sold. High-dividend ETFs like SPYD, HDV, and VYM hold many utility and consumer staples stocks, so if you own them, it’s worth remembering that they’re more exposed to rising rates right now. Meanwhile, VOO (S&P 500) and VTI (total U.S. market) were roughly flat, and in QQQ (Nasdaq-100) the winners and losers among big tech largely canceled each other out.

For the previous session, check out my U.S. market recap for Sept 23 (Dow down 352 points as the 10-year yield topped 5.1%).

What to Watch in Japanese Stocks Today: Higher Rates and the Middle East May Cap Gains

The Nikkei 225 closed up 495 yen at 65,513 on September 24, but Nikkei futures in the Osaka night session finished at 65,490, almost unchanged. Here are three things I’m watching in Tokyo today.

(1) The impact of higher global rates. With the U.S. 10-year yield at 5.19%, AI and chip stocks that have run up recently could see profit-taking. I’m also curious how Oracle-related names such as Oracle Corporation Japan react.

(2) End-of-September dividend buying. Investors tend to buy stocks to lock in interim dividends around this time, which should give the overall market, especially high-dividend stocks, some support.

(3) Tonight’s U.S. economic data. August durable goods orders and the University of Michigan consumer sentiment and inflation expectations are due. If inflation expectations rise, rate-hike talk could grow louder. Also, Costco (COST) reported after the close last night, with full-year revenue up 10% to $303.1 billion, so I’ll be watching how the stock reacts tonight.

Markets in South Korea, Taiwan, and China are closed today, so there may be fewer cues from the rest of Asia.

Let’s keep at it, slow and steady. Have a good day!

日本語版はこちら → 【米国株まとめ】9月24日

* This article is for informational purposes only and does not recommend any specific investment. Please make investment decisions at your own responsibility.

Sources: Yahoo Finance, TheStreet, Fisco / MINKABU PRESS (via Kabutan), Reuters, Bloomberg, CNBC, Motley Fool, Benzinga, Invezz, Investrade, Finviz

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