Key Takeaways
- • Financials ended the week higher as the XLF financial sector ETF added 1.58% to close at $54.73, benefiting from a hawkish Federal Reserve backdrop, according to Seeking Alpha's weekly wrap.
- • Visa (V) and Mastercard (MA) led megacap gainers, rising 6.87% to $385.45 and 6.68% to $589.14, respectively, after the Open USD (OUSD) stablecoin went live.
- • Wells Fargo (WFC) gained 3.85% to $83.55 after Morgan Stanley upgraded the stock to Overweight ahead of third-quarter earnings.
- • Crypto-linked equities were the sharpest decliners among largecaps, with IREN down 15.73%, Bitmine Immersion Technologies (BMNR) down 8.53%, and Hut 8 (HUT) down 5.98%.
- • Brazilian fintechs surged after the first round of Brazil's presidential election put Sen. Flávio Bolsonaro in the lead, with XP up 49.86% and Nu Holdings up 20.03%.
Summary
U.S. equities closed the week higher, with the financials sector outperforming despite pressure on technology and AI-linked names. The Federal Open Market Committee's September meeting minutes showed united support for the central bank's tightening cycle and highlighted upside inflation risks, reinforcing market expectations for prolonged higher rates. Semiconductor stocks were the notable laggards after OpenAI revised its annualized revenue expectations downward, prompting investor scrutiny of the sustainability of heavy AI infrastructure capital expenditures.
Among megacaps, Visa and Mastercard led weekly gains, supported by the launch of the Open USD (OUSD) stablecoin, even as a proposed credit card bill aimed at increasing competition and lowering merchant swipe fees made headlines. According to Seeking Alpha, the bill leaves the dominant networks with the most to lose. Wells Fargo rose 3.85% to $83.55 after Morgan Stanley upgraded the bank to Overweight from Equal Weight, citing normalizing balance sheet growth, easing funding pressures, and stabilizing net interest margin ahead of its third-quarter earnings release. TD Cowen also named Wells Fargo a top pick as it resumed coverage of 16 largecap U.S. banks.
Foreign banks led financial losers. HSBC Holdings fell 3.29% to $92.98 after reports that the lender plans to cut roles across its UK wealth business, with staff consultations underway. Mitsubishi UFJ Financial dropped 1.93% to $22.38.
Crypto-related equities were the largest decliners among largecaps, with IREN, Bitmine Immersion Technologies, and Hut 8 posting the steepest losses. Seeking Alpha attributes the selloff to leverage and macro pressure, noting that Federal Reserve minutes pointed to the possibility of another rate increase this year while the 10-year Treasury yield continued to rise. Smallcap and midcap crypto miners also fell sharply, including CleanSpark, Riot Platforms, and MARA Holdings.
Brazilian financial stocks were the week's standout performers. XP led gainers with a 49.86% advance to $32.22, Nu Holdings rose 20.03%, Itaú Unibanco gained 18.28%, and Banco Bradesco rose 17.81%. Seeking Alpha links the rally to the first round of Brazil's presidential election, which put Sen. Flávio Bolsonaro firmly in the lead. Inter & Co led midcaps with a 40.15% gain to $7.68.
Among megacaps, Visa and Mastercard led weekly gains, supported by the launch of the Open USD (OUSD) stablecoin, even as a proposed credit card bill aimed at increasing competition and lowering merchant swipe fees made headlines. According to Seeking Alpha, the bill leaves the dominant networks with the most to lose. Wells Fargo rose 3.85% to $83.55 after Morgan Stanley upgraded the bank to Overweight from Equal Weight, citing normalizing balance sheet growth, easing funding pressures, and stabilizing net interest margin ahead of its third-quarter earnings release. TD Cowen also named Wells Fargo a top pick as it resumed coverage of 16 largecap U.S. banks.
Foreign banks led financial losers. HSBC Holdings fell 3.29% to $92.98 after reports that the lender plans to cut roles across its UK wealth business, with staff consultations underway. Mitsubishi UFJ Financial dropped 1.93% to $22.38.
Crypto-related equities were the largest decliners among largecaps, with IREN, Bitmine Immersion Technologies, and Hut 8 posting the steepest losses. Seeking Alpha attributes the selloff to leverage and macro pressure, noting that Federal Reserve minutes pointed to the possibility of another rate increase this year while the 10-year Treasury yield continued to rise. Smallcap and midcap crypto miners also fell sharply, including CleanSpark, Riot Platforms, and MARA Holdings.
Brazilian financial stocks were the week's standout performers. XP led gainers with a 49.86% advance to $32.22, Nu Holdings rose 20.03%, Itaú Unibanco gained 18.28%, and Banco Bradesco rose 17.81%. Seeking Alpha links the rally to the first round of Brazil's presidential election, which put Sen. Flávio Bolsonaro firmly in the lead. Inter & Co led midcaps with a 40.15% gain to $7.68.
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