CNBC Daily Open: Fear is the stock killer

Stocks slumped connected persistent fears
Major U.S. indexes retreated connected Monday. The S&P 500 mislaid 0.96%, the Dow Jones Industrial Average dropped 0.94% and the Nasdaq Composite slumped 1.18%. But Super Micro shares were a agleam spot, jumping 15.8%. Europe's determination Stoxx 600 scale added 0.18%. Household goods led gains, closing 0.97% higher, portion tech shares fell 0.65%.

No much jumbo cuts
After past week's expectation-busting jobs study for September, there's virtually zero chance the U.S. Federal Reserve volition trim involvement rates by fractional a percent constituent astatine its adjacent meeting, strategists told CNBC. Traders agree. A week ago, they stake connected a 34.7% accidental of different jumbo chopped by the Fed; today, it's 0%, according to the CME FedWatch Tool.

AI request is inactive high
The artificial quality roar "still has immoderate clip to go," Foxconn Chief Executive and Chairman of Foxconn Young Liu told CNBC. Foxconn, which reported better-than-expected earnings for the 3rd quarter, manufactures electronics for exertion giants similar Apple and Nvidia. Demand for Nvidia's latest spot Blackwell is "much amended than we thought," said Liu.

Tensions propulsion lipid prices higher
Oil prices jumped astir 3.7% connected Monday connected worries Israel volition onslaught Iran's lipid accumulation facilities. If Israel hits Kharg Island, it could disrupt the transport of 90% of Iran's crude exports, said an analyst. Last week was the champion for West Texas Intermediate and Brent lipid prices successful much than one-and-a-half years. They surged 9.1% and 8.4% respectively.

[PRO] Goldman's getting much bullish
The S&P 500 is successful the reddish successful October truthful far. But Goldman Sachs raised its 2024 people for the S&P to 6,000 from 5,600, making it the second-highest forecast connected Wall Street, according to the CNBC Market Strategist Survey. Goldman besides accrued its 12-month S&P people to 6,300 from 6,000. Here's why the slope is truthful bullish connected stocks.

September's blockbuster jobs report, released Friday, lifted sentiment and stocks capable that large indexes reversed their losses and ended past week successful the green, but conscionable barely.

That halo has present faded away. Markets are backmost to contending with rising lipid prices, ostentation perchance reaccelerating, fewer-than-expected complaint cuts and perchance adjacent a distant recession.

Oil prices spiked yesterday aft having their champion week successful implicit a year. And September's blockbuster jobs report, the futures marketplace is pricing successful a 13.7% accidental the Fed volition not chopped rates astatine all astatine its November meeting. That's a drastic alteration from a week agone erstwhile traders thought determination was a 34.7% accidental of a 50-basis-point cut.

But a recession?

Admittedly, that's speculation connected my part. But it bears pointing retired that the output curve betwixt the 10- and 2-year Treasurys is "getting adjacent to flipping backmost into information territory," arsenic CNBC's Jeff Cox noted.

Simply put, erstwhile the 10-year output is little than that of the 2-year, the output curve is inverted – which has astir ever preceded a recession since the mid-1970s. The output curve inverted successful aboriginal July 2022 and normalized successful aboriginal September.

After Monday, however, the spread betwixt the 10- and 2-year yields is present conscionable 3.5 ground points. It's not inconceivable, then, for investors who instrumentality banal successful what the output curve signals to panic a little.

That said, strategists deliberation a recession is simply a far-fetched idea, considering the wellness of the U.S. economy.

As David Roche, laminitis and strategist astatine Quantum Strategy, enactment it, "the system is fine, convey you precise much."

So overmuch truthful that "the probability of the American system going into recession, astatine slightest successful the 4th fourth of this year, and astir apt successful the archetypal 4th of adjacent year, is adjacent to zero," said Bob Parker, elder advisor astatine the International Capital Markets Association.

Concrete numbers are driving marketplace movement. But there's an undercurrent of fearfulness that tin possibly tally contrary to what immoderate of those numbers are saying.

– CNBC's, Jeff Cox, Lisa Kailai Han and Jesse Pound contributed to this story.