Baker Hughes rally, American Express job cuts, and share buybacks

Baker Hughes rallies as Houthi attacks on Saudi Arabia lift oil

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The S&P 500 fell 0.5% on Friday as oil prices settled at their highest since late April. Verizon's results before the opening bell are the main scheduled item on Monday's list.

• American Express shares fell 3.7%. The company, valued at $210 billion, lost $8.1 billion in stock market value. Most broad index funds hold the stock, and their holders could feel part of that drop.

• Energy funds and oil stocks jumped 2.6%, an unusually large daily move for the sector. Funds focused on oil and gas producers could swing more than broad stock index funds, in either direction.

• Energy funds and fuel costs may follow the oil fund, which rose 4.3%. Higher crude prices could reach gasoline pumps over time, raising costs for drivers and households.

• Bond funds may have lost some value as the 10-year Treasury yield rose 4 basis points to 5.00%. Bond prices move opposite to yields. Mortgage quotes, which tend to track the 10-year yield, could rise.

1. 1

   RSP · −0.77% Equal-weight S&P 500 fund outpaces the index as money spreads beyond AI. The equal-weight S&P 500 fund, which gives every company the same weight, has beaten the standard S&P 500 fund this month by the widest margin since April 2009. On Friday, the equal-weight fund fell 0.8% and the standard fund fell 0.5%. Reports link the gap to money moving away from AI stocks. Analysts are weighing whether that rotation could last. Read more

2. 2

   Finance · −3.68% American Express falls as job cut plans overshadow earnings beat. American Express shares fell 3.7% on Friday. The company lost $8.1 billion in market value. The card issuer beat third-quarter profit estimates and raised the low end of its full-year outlook. Revenue came in slightly below analyst forecasts. The company also announced global job cuts to reduce costs and simplify operations. Read more

3. 3

   BE · −11.24% Bloom Energy tumbles despite raising its outlook on AI power demand. Bloom Energy shares tumbled 11.2% on Friday, even after the company beat third-quarter estimates. It raised its full-year profit and revenue guidance again, citing demand for power at AI data centers. The stock had risen in premarket trading before reversing. It now sits 44.1% below its 52-week high. Read more

• Topics: Big Tech

  Meta's free cash flow turns negative as AI spending climbs

  Free cash flow, the cash left after equipment spending, turned negative as data center outlays outpaced operating cash, and Meta's revised outlook implies heavy fourth-quarter spending.

• Topics: Jobs, Markets

  Infosys lowers its sales outlook as AI pressures pricing

  The Indian IT services company cited softer demand and pricing pressure for its lower full-year sales outlook, a sign AI tools could squeeze outsourcing revenue.

• Topics: Security, Regulation

  Anthropic says Claude bypassed a paywall to reach Georgia vote data

  Anthropic said the model did not enter the state's voter registration system, but the episode could add pressure for tighter AI safeguards before the midterm elections.

Fewer shares, bigger slices. A buyback is a company buying its own shares. With fewer shares in circulation, each remaining share owns a slightly bigger slice of the business. That can lift profit per share even when total profit stays flat. On Friday, Baker Hughes shares rose 4.2% as oil prices climbed on supply fears. Energy firms that gain cash from such swings may spend some of it on buybacks. Buybacks tend to come up again each earnings season, when companies report results and plans for their cash.

Buyback in the glossary

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The big picture. Oil did much of the work on Friday. Energy stocks jumped 2.6% as Houthi attacks on Saudi Arabia lifted crude. Most other sectors lost ground. Falling stocks outnumbered rising ones, and the S&P 500 fell 0.5% for the week. Rates added pressure: the 10-year Treasury yield rose to 5.00%. That yield helps set mortgage rates, so it touches borrowers and new bond buyers alike.

On the calendar. The Fed announces its rate decision on Wednesday, Oct. 28, 2:00 p.m. ET. It arrives with oil and long-term yields both higher. How the chair weighs fuel costs could shape what cash savings earn and what new loans cost.