Investopedia Markets News (all except PF)

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Even with Thursday's plunge, Snowflake shares have gained over 50% in 2025.

Key Takeaways

• Snowflake shares tumbled Thursday after the firm issued a disappointing margin forecast, raising worries its AI investments could squeeze profits.
• The cloud data analytics company's quarterly earnings and revenue topped analysts' estimates, with a boost from AI-driven demand.
  

Investors are hammering Snowflake's stock despite quarterly results that topped analysts' expectations on the top and bottom lines.

Shares of Snowflake (SNOW) were down over 10% in recent trading, a day after the cloud data analytics company issued a disappointing margin forecast. (Read our daily markets coverage here.) 

Snowflake posted adjusted earnings of $0.35 per share on revenue that jumped 29% year-over-year to $1.21 billion in the third quarter. Both figures exceeded analysts' estimates compiled by Visible Alpha.

Operating income came in at $131.3 million, with an 11% margin. However, the firm said it expects a 7% operating margin for the fourth quarter, below the 9% margin it guided for—and surpassed—in the third quarter.

Snowflake's anticipated margin drop raised some worries on Wall Street about its AI-related spending, with Oppenheimer analysts telling clients after the results that new AI investments could hold back profits in the short term. Still, the analysts said they see gains ahead for the stock, with an "outperform" rating and $295 price target. Morgan Stanley and Bank of America also reiterated bullish ratings, anticipating room for AI-driven growth.

Why This Is Significant

Snowflake's stock has been a big beneficiary of the AI boom this year, though Thursday's fall has taken a bite out of its rally, suggesting limited willingness from investors to support a hit to margins.

While Wall Street's ratings may be in flux after the result, the mean target for Snowflake's shares is around $280 based on Visible Alpha data. Nineteen of the 21 analysts tracked have issued "buy" calls for the shares, with just one neutral, and one sell rating.

Snowflake CFO Brian Robins told analysts during the company's earnings call not to "read too much into" the company's fourth-quarter guidance, according to an AlphaSense transcript.

"We will continue to invest in the business, but I think there is also substantial gains to be had in just how efficient we are as a company," CEO Sridhar Ramaswamy said, adding, "I don't think of this as an either/or. We have had pretty healthy expansions in things like operating margin, but also things like [stock-based compensation] year-over-year, and we will continue to press hard on those things."

Even with today's plunge, Snowflake stock is up more than 50% in 2025.

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Exterior view of 610 Hicksville Rd, in Bethpage, New York on November 26, 2025.

Key Takeaways

• The U.S. economy is losing jobs at the fastest pace since the pandemic, according to a pair of private-sector reports on the labor market released Thursday.
  
• The reports from Challenger, Gray & Christmas and Revelio Labs highlighted concerns that the job market is slowing down if not shrinking outright.
  

With government data on the job market for November still weeks away, a pair of private reports show pink slips are flying faster while job offers are slowing down.

U.S. employers shed 9,000 jobs in November, according to a job market report by Revelio Labs, an analytics company that tracks job gains and losses using data from online professional profiles. That was better than the 15,500 lost in October, but it was the fifth month out of the last seven that job growth has been in the red.

A separate report from consulting firm Challenger, Gray & Christmas showed employers announced 71,321 job cuts in November, up from 57,727 in the same time last year. However, it is down from the surge of 153,074 in October.

The data from private-sector firms provide a snapshot of the job market's health in the absence of official reports, which were delayed by the government shutdown. The official job market report from the Bureau of Labor Statistics for October was canceled, and the November report, previously scheduled to be released on Friday, was delayed until Dec. 16.

What This Means For The Economy

The private sector reports are the latest in a series of red flags about the health of the job market, although they're not as definitive as official data that will be released later this month.

The reports were the latest in a series of indicators showing that the job market is slowing down, on the heels of a report on Wednesday from payroll provider ADP, which showed that private employers shed 32,000 jobs in November.

Economists have said tariffs and the uncertainty surrounding them are a significant factor in the job market slowdown. Employers have put expansion plans on ice amid uncertainty about trade policy, and consumers are tightening their belts because of higher prices.

"Tariffs have raised production costs and inflation expectations, causing consumers to be more cautious with their spending," Tom Campbell, an economist at Moody's Analytics, wrote in a commentary.

The reports reinforced concerns that the job market is faltering outside of the education and health care sector, which continues to expand. The most significant job losses in the Revelio report came in the retail trade and manufacturing sectors.

The 1,170,821 job cuts tracked by Challenger to date this year are the highest since the pandemic hit in 2020, while the 497,151 hiring announcements are the fewest since the end of the Great Recession in 2010.

To be sure, economists generally consider private reports less reliable than the official data, which is based on massive surveys, and are waiting on numbers from the statistical agencies to provide a more definitive picture. A separate report from the Department of Labor on Thursday seemingly contradicted the gloomy picture painted by ADP, Challenger, and Revelio, as unemployment claims fell to their lowest in 2022 last week.

However, the drop in unemployment claims could be just a statistical blip caused by the holidays.

"This doesn’t tell us much about the labor market," Heather Long, chief economist at Navy Federal Credit Union, wrote in a commentary. "It simply tells us Americans put their job searches and unemployment claims on hold over the late holiday this year."

While not definitive, the private-sector data provides officials at the Federal Reserve with more reason to cut interest rates in hopes of preventing a surge in unemployment. The Federal Open Market Committee is widely expected to cut its benchmark interest rate by a quarter-point at its meeting next week, despite concerns that lower borrowing costs could fuel inflation.

News of the day for Dec. 4, 2025

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The S&P 500 and the Dow Jones Industrial Average enter today's session less than 1% away from record closing highs.

Stock futures are holding steady Thursday as investors await more economic data that could influence the Federal Reserve's decision on interest rates next week; Meta is facing a new antitrust investigation over its artificial intelligence policies in WhatsApp; Salesforce earnings topped estimates after the bell Wednesday; Paramount Skydance and Netflix are reportedly continuing to modify their bids for Warner Bros. Discovery; and Dollar General is the latest discount retailer to report strong earnings this week. Here's what you need to know today.

Stocks Little Changed as Major Indexes Back Near Record Highs

Stock futures are hovering near unchanged this morning after the major indexes gained for the seventh time in the last eight trading sessions on Wednesday. Futures tied to the Dow Jones Industrial Average and the benchmark S&P 500 were up 0.1% recently, while those linked to the tech-heavy Nasdaq were fractionally lower. The Dow and S&P 500 enter today's session less than 1% away from new record closing highs. Stocks have rallied as investors have grown increasingly confident that the Federal Reserve will cut interest rates at its policy meeting next week. Market participants will be keeping tabs on jobless claims numbers this morning and a key inflation report set to be released Friday, which are among the final data points the Fed will have before making its decision. The yield on the 10-year Treasury note, which affects borrowing costs on a wide range of consumer loans, was at 4.09% recently, up from 4.06% late yesterday. Bitcoin was little changed at around $93,000, after rising sharply the past two days, while gold futures were down 0.3% at $4,220 an ounce.

Meta Faces EU Antitrust Investigation Over WhatsApp AI Policies

The European Commission has launched a new investigation into Meta Platforms (META), as the EU's enforcement arm continues its recent trend of investigating big tech companies. The Commission will evaluate whether Meta's new policy blocking AI companies from being able to reach users directly through the app violates EU competition law. Currently, users can communicate with several AI companies that offer their chatbot services through WhatsApp, but as of Jan. 15, 2026, those companies may be blocked from talking to users thanks to a new Meta policy. The Commission says that could be anticompetitive if it means that Meta's own chatbot, Meta AI, is the only option for users to communicate with after the policy goes into effect. A WhatsApp spokesperson told Investopedia that the Commission's claims are "baseless" and that the policy change is being made because AI companies operating their chatbot services on WhatsApp strains the platform's infrastructure.

Salesforce Tops Earnings Estimates as AI Drives Growth

Salesforce (CRM) topped profit estimates in its latest earnings report and lifted its outlook for the full year, citing momentum from its AI offerings. The customer relationship management software leader late Wednesday reported revenue that came in roughly in line with estimates, while adjusted earnings per share of $3.25 was about 40 cents higher than analysts had projected. CEO Marc Benioff said that the company's Agentforce—which helps companies build customized AI agents that are designed to handle more complex tasks than normal AI chatbots—was a major growth driver in the quarter. The company increased its revenue and profit projections. Salesforce shares, which through Wednesday's close had lost 29% of their value so far in 2025, were up 1.5% in recent premarket trading.

Paramount, Netflix Continue Sweetening Bids for Warner Bros. Discovery

Shares of Paramount Skydance (PSKY) and Netflix (NFLX) have stabilized this morning after sliding yesterday amid reports that the companies had sweetened their respective bids to acquire Warner Bros. Discovery (WBD). Wednesday afternoon, Bloomberg reported that Paramount has hiked its breakup fee, what it would pay Warner Bros. if a deal is agreed to but never completed, to $5 billion from $2.1 billion previously. The growing sum suggests Paramount is confident that a potential acquisition would survive regulatory scrutiny, as the Ellison family that now controls Paramount Skydance has talked publicly about having a good relationship with the Trump administration, per Bloomberg. Paramount Skydance shares were up 1% in premarket trading after tumbling 7% yesterday, while Netflix shares rose slightly ahead of the fell after sliding 5% on Wednesday.

Discount Retailers Report Strong Earnings as Consumers Seek Value

Shares of Dollar Tree (DLTR), Five Below (FIVE) and Dollar General (DG) are all rising this morning as investors digest strong earnings reports from the discount retailers. Dollar Tree, which released its better-than-exepected results yesterday morning, said it continues to see "value-seeking behavior" from consumers and that it gained market share with higher-income households. Five Below late Wednesday also reported results that topped Wall Street estimates, as comparable sales jumped 14% during the latest quarter. Meanwhile, Dollar General this morning reported a higher-than-anticipated profit and reaffirmed its plan to open around 575 new stores next year, while remodeling thousands more. Dollar General shares were up nearly 6% ahead of the opening bell, while shares of Five Below and Dollar Tree added 3% and 1%, respectively.

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The Trump family's crypto ventures have been hit hard by the recent market slump.

Key Takeaways

• Investments directly linked to President Donald Trump and his family have declined precipitously in recent months after soaring in the wake of his reelection.
• The weakness has been most pronounced in the Trump family's various crypto ventures, with meme coins, tokens, and shares of bitcoin mining operations all slumping this year.

It’s been a troubling couple of months for investors—including the first family.

Assets linked to President Donald Trump and his family have underperformed the broader market in recent months. The weakness has been most pronounced in crypto markets, where affiliation with the Trump family has at other times sent asset prices skyrocketing. 

Shares of Eric Trump’s American Bitcoin (ABTC), formed through a merger with an existing bitcoin miner, plummeted as much as 50% in early trading on Tuesday and finished the session down 39%. American Bitcoin on Tuesday closed at its lowest price since Trump’s involvement was announced in May and finished Wednesday about 75% below its September closing high.

Meanwhile, a widespread crypto rally pushed Bitcoin back above $93,000 and lifted shares of miners and Bitcoin treasury companies like Strategy (MSTR)—the latter of which rose nearly 4% yesterday.

Why This Is Important

Since President Trump's reelection last November, an affiliation with him or his family has at times sent asset prices soaring. In recent months, the premium investors are willing to pay for the Trump name has largely evaporated, with the family's crypto ventures being particularly hard hit.

World Liberty Financial (WLFIUSD), the native token of the Trump-backed crypto enterprise of the same name, has lost about 65% of its value since hitting a record high on its first trading day in September. The $TRUMP and $MELANIA meme coins have both lost about nine-tenths of their value from their all-time highs on Jan. 19, the day before Trump’s second inauguration. 

President Trump returned to the White House promising to make the U.S. the "crypto capital of the world." Shortly after taking office, Trump formed a digital asset working group, established a national strategic Bitcoin reserve, and supported stablecoin legislation passed over the summer.

Trump and Congress's fondness for the crypto industry boosted digital assets. Cryptocurrencies soared in the wake of the 2024 election and, barring weakness during March and April's tariff-driven rout, continued to ride high for most of the year. Bitcoin hit a record high above $125,000 in early October.

The optimism that propelled risk assets to record highs, however, waned in recent weeks month amid macroeconomic uncertainty and concerns about an AI bubble. Still, some of the most aggressive profit-taking of late has been in corners of the market that soared on their association with the Trump family.

Most of the weakness in the Trump family portfolio is in its crypto-related ventures, but even more conventional assets are suffering. Shares of Trump Media & Technology (DJT), the parent company of Truth Social, have lost some two-thirds of their value since the start of the year. Last month, shares hit their lowest level since they began trading in late 2021, when Trump was effectively in political exile.

The S&P 500, on the other hand, has rebounded from a weekslong pullback. It finished Wednesday near a record high.

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Salesforce shares were down nearly 30% for 2025 heading into the release of the earnings report.

Key Takeaways

• Salesforce posted a quarterly profit that topped analysts' estimates, citing momentum from its AI offerings.
• The customer relationship management software leader also boosted its outlook.

Could a bit of fresh momentum from Salesforce's AI offerings be just what the company needed to kick-start a recovery in its stock?

Shares of Salesforce (CRM) were recently up 3% in extended trading Wednesday, after the software giant posted a better-than-expected quarterly profit and raised its outlook on the back of growth from its data products and AI offerings.

The customer relationship management software leader reported adjusted earnings per share of $3.25 for its fiscal 2026 third quarter, well above the $2.86 analysts were looking for. Its revenue, which jumped 9% year-over-year to $10.26 billion, was roughly in line with estimates compiled by Visible Alpha.

Why This Is Significant

The signs of AI-driven momentum could help reignite enthusiasm for Salesforce's stock, which has lingered in negative territory for the year amid some concerns about the adoption of its AI offerings and competition in the space.

CEO Marc Benioff said Salesforce's Agentforce, which helps companies build customized AI agents, was a major driver of growth, along with the company's data products. Annual recurring revenue from Agentforce and Data 360 offerings more than doubled year-over-year to $1.4 billion.

Looking ahead, Salesforce said it now sees full-year adjusted earnings of $11.75 to $11.77 on revenue of $41.45 to $41.55 billion, compared to its earlier forecast of EPS of $11.33 to $11.37 on revenue of $41.1 billion to $41.3 billion.

The stronger outlook could help kick-start a rebound for the company's shares, which were down nearly 30% for 2025 heading into Wednesday's results after its prior outlook disappointed.

Eugene Gologursky / Getty Images for Macy's

Macy's says it's happy with early holiday shopping results.

Key Takeaways

• Macy's relatively affluent customers are "resilient" and "engaged" as holiday shopping gets underway, CEO Tony Spring said.
• The company's gains were largely driven by its luxury department store, Bloomingdale's, and "aspirational" customers may not stick around, Spring said.

Well-heeled consumers are maintaining their pace as the holidays approach, Macy's says.

The middle- and upper-income households that tend to shop at Macy's Inc. (M) spent briskly this fall, the parent company of Bloomingdale's and Bluemercury as well as Macy's said Wednesday. They shoppers helped the retailer record a 3% year-over-year increase in comparable store sales—its biggest gain in three years.

The affluent have been actively shopping for the holidays, though CEO Tony Spring said it's too soon to say whether the momentum will last through the end of the season.

"Our customer base, which is predominantly middle to upper income, remained resilient and engaged in the third quarter," Spring said, according to a conference call transcript made available by AlphaSense. "We're pleased with the start of the fourth quarter."

Why This News Matters

Higher-earners have been driving the economy. Business leaders seem hesitant to say this will continue, but most executives aren't seeing weakness among affluent consumers.

Macy's raised its outlook for the full fiscal year after its third-quarter numbers exceeded expectations. Still, the forecast assumes consumers will be "more choiceful" in the fourth quarter, in part, because "aspirational" customers may pull back, Spring said. (The term "aspirational" refers to those who don't have the means to comfortably or routinely shop with a store, but may sometimes splurge there.)

The company's luxury outpost, Bloomingdale's, posted stronger results than its namesake brand, highlighting what's sometimes called the K-shaped economy. Affluent customers have been comfortable spending, their mood lifted by an upbeat stock market, but a sluggish job market and inflation have given others pause. Comparable store sales at Bloomingdale's rose 9% year-over-year, Spring said.

Bloomingdale's is wooing the "luxury customer of the future" by working with more luxury brands, Spring said. "We continued to expand the breadth of the brands we offer introducing a number of important designer brands, including Totême, TWP, Zimmerman, Victoria Beckham, Christian Louboutin and Roger Vivier."

The high-end department store's customers bought men's apparel, fine jewelry and shoes, Spring said. Macy's stores also had strong sales in men's clothing, watches, fine jewelry and handbags, he said.

Macy's said quarterly revenue dipped slightly year-over-year to $4.7 billion, ahead of the $4.6 billion analysts' consensus estimate compiled by Visible Alpha. Adjusted earnings totaled $26 million—more than double the $11 million reported a year earlier and well above the $37 million loss analysts expected, according to Visible Alpha.

Macy's shares fell about 1% on Wednesday. They're up about 35% so far this year.

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Forecasters expect inflation as measured by PCE rose over the 12 months ending in September.

Key Takeaways

• Core PCE inflation, the Fed's preferred gauge of consumer price increases, likely rose 2.9% in September, heading in the wrong direction from the Fed's goal of a 2% annual rate.
  
• Although Fed officials are worried about simmering inflation, they are expected to cut interest rates anyway next week to help the faltering job market.
  

The Fed's preferred measure of inflation likely kept sizzling in September.

A report scheduled for release on Friday is expected to show that inflation, as measured by the Personal Consumption Expenditures index, rose 2.8% over the 12 months ending in September, up from 2.7% in August according to estimates by RBC Bank among others. That would be the highest since April 2024. "Core" inflation, which excludes volatile prices for food and energy, likely rose 2.9% over the year, the same as in August.

If the report matches expectations, it would mark 55 months since core PCE inflation—the price measure preferred by officials at the Federal Reserve—was higher than the Fed's target of a 2% annual rate.

Inflation surged during the pandemic, peaking in 2022 and subsequently falling toward the Fed's target. But President Donald Trump's tariffs have pushed up prices again this year, as merchants pass the cost of the import taxes on to consumers.

What This Means For The Economy

Inflation has been a thorn in the side of the economy since 2021 and forecasters don't expect it to return to pre-pandemic levels anytime soon.

Friday's report was initially scheduled for October, but was delayed by the government shutdown. If it matches expectations, PCE inflation would have the same annual increase as the more widely-watched Consumer Price Index for September. The two price measures often move in the same direction, although they often show slightly different inflation rates.

Forecasters expect inflation to remain above target for months, if not years, to come. Economists at Bank of America, for example, expect core PCE inflation to stay over 3% through the third quarter of 2026 and over 2% through 2027, according to a commentary published Wednesday.

Stubborn inflation, however, may not deter the Fed from cutting its benchmark interest rate at its meeting next week. Although the Fed officials have kept rates high to discourage borrowing and quell inflation, they also face pressure to cut rates to encourage hiring and help out the increasingly shaky job market. The Fed cut its benchmark interest rate by a quarter-point at each of its last two meetings and is widely expected to do so again.

Fed officials have said they see risks on both halves of its dual mandate from Congress to keep inflation low and employment high, and the two goals are pulling interest rates in opposite directions. A recent slowdown in job growth has given the rate-cutters the upper hand in the debate.

Kyle Grillot / Bloomberg via Getty Images

Reports on inflation and other economic factors are going to be on alternate schedules for the remainder of the year.

Key Takeaways

• The federal government shutdown froze economic data releases, and agencies are still working to catch up. 
• While a handful of reports have been rescheduled, some have also been consolidated or canceled. Other new release dates are still expected for several key reports for September, October and November.

The government shutdown ended three weeks ago and statistical agencies are working to catch up on economic releases they missed.

After being closed for 43 days, the federal bureaus that track inflation, employment, and economic growth are behind schedule on several reports, but they are beginning to catch up.

This week, we’ll see inflation data for September, which was initially scheduled to be published in October. And there are several other unreleased reports that agencies like the Census Bureau, the Bureau of Economic Analysis and the Bureau of Labor Statistics still need to issue, cancel or combine. 

Why This Matters

Delayed economic reports can blur the outlook for inflation, jobs, and growth, complicating decisions for investors, businesses, and policymakers. Understanding the new schedule helps readers interpret upcoming market-moving data.

Here are some of the new release dates and schedule changes announced so far:

• Dec. 3: September industrial production and capacity utilization (Originally scheduled for Oct. 17 release)
• Dec. 5: September Personal Consumption Expenditures (PCE) price index, personal incomes and outlays(Originally scheduled for Oct. 31)
• Dec. 9: September and October Job Openings and Labor Turnover Survey (JOLTS)(Originally scheduled for Nov. 4 and Dec. 2)
• Dec. 10: Q3 employment cost index (Originally scheduled for Oct. 31 )
• Dec. 11: September U.S. trade deficit (Originally scheduled for Nov. 4 release)
• Dec. 11: September wholesale inventories (Originally scheduled for November release)
• Dec. 16: November U.S. employment report, including October payrolls (Originally scheduled for Nov. 7 and Dec. 5; the household survey for October is cancelled)
• Dec. 16: October retail sales (Originally scheduled for November release)
• Dec. 16: September business inventories (Originally scheduled for November release)
• Dec. 18: November Consumer Price Index (CPI), including a subset of the October report (Originally scheduled for Nov. 13 and Dec. 10 releases )
• Dec. 23: Q3 Gross Domestic Product, initial estimate (The advance GDP estimate scheduled for Oct. 30 was cancelled. The Bureau of Labor Statistics will postpone a subsequent third quarter GDP estimate originally scheduled for Dec. 19.)
• Dec. 23: October and November industrial production and capacity utilization (Originally scheduled for Nov. 18 and Dec. 16 releases)
• *Dec. 23: October durable-goods orders (Originally scheduled for November release)

*Here are some reports that still need to be rescheduled or have been cancelled:

• September housing starts (Originally scheduled for Oct. 17 release; October and November reports are also not yet rescheduled)
• September new home sales (Originally scheduled for Oct. 24 release; October and November reports are also not yet rescheduled)
• September, October and November advanced reports on trade deficit, wholesale inventories and retail inventories have been canceled
• October U.S. trade deficit (Originally scheduled for a December release; the November report is also not yet rescheduled)
• October business inventories (Originally scheduled for a December release; the October report is also not yet rescheduled)
• November retail sales (Originally scheduled for December release)
• November durable-goods orders (Originally scheduled for December release)
• October PCE price index, personal incomes and outlays (Originally scheduled for Nov. 26; the November report is also not yet rescheduled)

Update, Dec. 4, 2025: This article has been updated to include information from the U.S. Census Bureau and the Bureau of Economic Analysis released Thursday.

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Shares of Paramount Skydance fell on Wednesday as competition to buy Warner Bros. Discovery heated up.

Key Takeaways

• A chipmaker got a boost from strong guidance on Wednesday, Dec. 3, 2025, while the ongoing saga around the takeover of a rival weighed on a pair of entertainment giants.
• Microchip Technology raised its quarterly sales and profit forecasts, and shares of the semiconductor company soared.
  
• Shares of Paramount Skydance and Netflix dropped as Warner Bros. Discovery reportedly neared a decision on their respective buyout offers.

A semiconductor maker increased its quarterly forecast, with strong bookings suggesting a recovery in several key end markets, and its shares led the S&P 500 higher. Meanwhile, two major media players came under pressure as a rival evaluated their competing buyout offers.

Major U.S. equities indexes gained ground in the midweek trading session as soft private-sector payroll data increased expectations of a Federal Reserve rate cut this month. The Dow jumped 0.9%, the S&P 500 added 0.3%, and the Nasdaq gained 0.2%. For more coverage from Investopedia on the day's market moves, see here.

Shares of Microchip Technology (MCHP) surged 12.2%, posting the S&P 500's strongest daily performance. The maker of microcontrollers and other semiconductors raised its quarterly forecast for net sales and adjusted earnings per share, highlighting strong bookings activity and an improving backlog. Shares of fellow chipmakers ON Semiconductor (ON) and NXP Semiconductors (NXPI) rose 11% and 5.7%, respectively.

Vertex Pharmaceuticals (VRTX) shares added 6.9% after Morgan Stanley upgraded the stock to "overweight" from "equal weight" and lifted its price target. Analysts pointed to growing optimism around Vertex's pipeline of kidney treatments, with data from Phase 3 clinical trials of two experimental drugs, Pove and Inaxaplin, anticipated next year.

Shares of Delta Airlines (DAL) rose 3.6% after it warned that the government shutdown, which disrupted air traffic across the country, likely cost the carrier about $200 million in pre-tax profit in the current quarter. However, the company also said that demand in the current quarter is strong and is expected to remain so into next year. Shares of competitor United Airlines (UAL) rose 3.9% on Wednesday.

Shares of Alexandria Real Estate Equities (ARE), a real estate investment trust (REIT) focused on life sciences properties, plunged 10.1% to suffer the steepest loss of any S&P 500 stock Wednesday. The move lower came after the firm's guidance for 2026 funds from operations, a key profitability metric for REITs, fell short of consensus expectations. The REIT also announced a 45% cut to its quarterly dividend.

Sandisk (SNDK) shares fell 5.3%. Following massive year-to-date gains for the stock, bolstered by optimism for the memory card and data storage provider's AI opportunity, Sandisk joined the S&P 500 on Nov. 28. However, the stock has been trending lower since its debut.

Shares of Paramount Skydance (PSKY) and Netflix (NFLX) fell 7.3% and 4.9%, respectively, as investors weighed their competing offers to buy Warner Bros. Discovery (WBD). Netflix reportedly made a mostly cash offer for the company's film and streaming assets. Paramount is reportedly exploring a contingency plan to bypass the board and take an offer directly to WBD shareholders. WBD shares edged 0.2% higher.

Christopher Dilts / Bloomberg / Getty Images

CME is a major force in the global financial system, providing continuous price signals to traders, hedge funds, brokers and other investment professionals in real-time

Key Takeaways

• CME Group's derivatives markets went dark last Friday after a vital data center run by a third party overheated.
• The technical glitch showed how much global financial markets depend on a few key institutions.

The potential for a hugely damaging disruption in financial markets was averted thanks to a holiday.

CME Group (CME), one of the largest derivatives exchanges in the world, halted futures and options trading across major asset classes for 10-plus hours, ending early last Friday, due to an overheated data center. The outage occurred when trading volumes were lower than average due to Thanksgiving, which may have helped contain the chaos.

The crisis appears to have been averted, with financial professionals across the spectrum merely complaining about the blackout, and others speculating how much worse it could've been had it occurred during a normal trading day. However, that one faulty data center briefly took down a major exchange and had such far-reaching consequences—a futures exchange in Malaysia and its customers were affected—is deeply concerning in an industry that relies on a few key players.

Why This Matters to Investors

Market dominance leads to overeliance on a few big players. Just as recent cloud service issues at Amazon Web Services and Cloudflare sparked massive internet disruptions, the interconnectedness of the global financial system means that a broken air conditioner in Illinois could be felt by traders in Malaysia.

CME is a major force in the global financial system, processing futures and options linked to $1.7 trillion in underlying stock indexes alone. The company provides continuous price signals to traders, hedge funds, brokers and other investment professionals in real-time—for agriculture, currencies, precious metals, energy, and crypto as well—information as critical to financial firms as GPS navigation is to the airline industry. CME's derivatives markets operate nearly 24 hours a day on trading days.

For investors who trade CME futures to hedge their positions in Treasurys, stocks or commodities, an outage, even a brief one, leaves them exposed. What has been largely chalked up to an inconvenience—this most recent glitch and the shorter one in 2019—raises the specter of a much bigger financial market disturbance because there aren't many alternative derivatives trading venues.

CME's outage hit across its derivatives markets, the knock-on effects of which were visible on social media platforms: brokers said pricing for certain contracts were temporarily unavailable and Redditors claimed their trades were stuck or unfairly closed as a result of the outage. The firm's Globex platform, its main venue for trading futures that accounts for more than 90% of its average daily volumes, resumed operations early Friday morning, before the market's abridged, post-Thanksgiving trading session.

The issue that broke CME's main electronic-trading hub was traced back to a CyrusOne-operated data center in Aurora, Illinois, according to the Wall Street Journal. Temperatures reportedly rose when the air conditioner broke; CyrusOne said it bolstered backup cooling after the event.

How CME plans to address its data center dependence remains an open question. The company didn't respond to an emailed query.