Apple saved the bad news for its earnings call, an hour after it posted its results for the September quarter, projecting that for the current quarter its high-margin services business will continue to slow and that its widely watched gross profit margin will continue to fall. Apple AAPL shares had been flat in post-close trading but declined as much as 4% after the company made the projections, which fell short of Wall Street estimates. The impact of high memory costs is weighing even more heavily on the company, CEO Ternus and Apple Chief Financial Officer Kevan Parekh said on the company’s earnings call. Oppenheimer analyst Martin Yang noted that Apple stock trades at 36 times next year’s expected earnings, a premium to the overall market, even though its earnings are only expected to grow 1%, which is slower than its tech peers. While others invest in data centers, Apple has been pouring its own cash into buybacks and dividends. Apple revealed its revenue grew 12% in the September quarter, slightly ahead of Wall Street’s expectations. Its widely tracked gross profit margin, at 47.9%, also came in just ahead of analyst’s estimates.

On Monday, the SMI dropped 0.1 percent to 14,803 points. Profit-taking pushed down pharmaceutical heavyweights Novartis and Roche—which had performed well last week—by 1.7 and 1.5 percent, respectively. UBS analysts had downgraded Roche to “Neutral.” Deutsche Bank had issued a sell recommendation for Novartis. The defensive heavyweight Nestlé (-0.1%) was also shunned. Logitech regained some ground after its sharp price drop in reaction to its quarterly results, increasing by 0.3 percent. In addition, investors turned to cyclical stocks, particularly those in the construction sector. Amrize, Holcim, Geberit, and Sika jumped by as much as 4.5 percent. Among smaller-cap stocks, Arbonia plummeted 13.4 percent. The company has revised its forecasts for the current year. Medartis (+6.9%), on the other hand, expressed greater optimism for the remainder of 2026.

Europe
European stock markets started the week on a positive note. According to MarketWatch data, the Stoxx Europe 600 index rose 0.4% on Monday to 649.4 points. In Paris, the CAC 40 and the SBF 120 gained 1% and 0.9%, respectively. The DAX 40 advanced 0.6% in Frankfurt, and the FTSE 100 picked up 0.3% in London. ALSTOM (-26.1%): The rail equipment manufacturer issued a profit warning on Monday regarding its results for the fiscal year ending next March, due to difficulties encountered in its Coradia Max regional train program and other projects for Germany. FORVIA (+5.4%): The automotive supplier confirmed its financial targets for 2026 on Monday, as its revenue declined less sharply than the markets in the third quarter. SAFRAN (+4.5%): The aerospace engine and equipment manufacturer confirmed on Monday having been selected this year for three inertial navigation programs as part of France’s nuclear deterrent. No financial details were disclosed. At Ryanair, profits dipped compared to the previous year. As expected, this decline is due to the sharp rise in fuel costs. “However, the situation shouldn’t pose a real problem for Ryanair, as the company still has sufficient cash on hand to carry out a share buyback,” commented one trader. Ryanair’s stock shot up 5.4%.

United States
Stocks were mixed as hopes for U.S.-Iranian negotiations caused a slide in the price of oil, while concerns about a potential artificial-intelligence bust weighed on the technology sector. The Dow Jones Industrial Average rose 213.67 points, or 0.41%, to 51983.98. Meanwhile, the broad S&P 500 fell 38.67 points, or 0.51%, to 7541.40, and the tech-heavy Nasdaq Composite dropped 272.68 points, or 1.07%, to 25164.32. Adding to trepidation around the AI trade was uncertainty ahead of the midterm elections on Tuesday. The results are unlikely to slow the AI boom despite the unpopularity of data centers, analysts at Jefferies said in a note to clients. Chip-maker Marvell Technology MRVL agreed to buy optical-network equipment maker Lumentum LITE for about $80 billion in stock, seeking to build a diversified provider of AI hardware. Shares of Marvell slid 13% to $171.41. Lumentum tumbled 19% to $684.40. Oracle ORCL shares retreated 8.8% to $119.22 after the software maker unveiled plans to raise $20 billion of debt and equity as it looks to finance AI infrastructure. Shares of CoreWeave CRWV declined 8.6% to $50.15, a 52-week closing low, as concerns about the cloud-computing company’s growing debt weighed on the stock. AI model maker Anthropic posted higher-than-anticipated revenue growth in the third quarter, yet a pricey data-center deal generated an operating loss. Rival OpenAI has raised less than half of the $30 billion it had initially targeted for its latest funding round, with market jitters about the AI trade dampening investor appetite. In other parts, the market shares of Marriott International’s MAR stock rose 4.3% to $416.30 after the hotelier posted quarterly revenue growth, citing strong demand in North America and a rebound in the Middle East. Shares of New York cosmetics firm The Estee Lauder Companies EL were off by 4.1% to $104.77 despite a report on fiscal first-quarter earnings and sales growth.

Asia
Asian indexes diverged for the Tuesday trading session. In Seoul, South Korea, the technology-heavy Kospi plunged 3.9 percent. In Shanghai, the Composite Index fell 1.1 percent. The HSI in Hong Kong fared better, rising 0.5 percent. In Japan, trading on the financial markets is suspended due to a holiday. Among individual stocks across the region, airline shares are edging higher following the drop in oil prices. In Hong Kong, Cathay Pacific jumped 2.9 percent; in Sydney, Qantas soared 6.7 percent; and in Hong Kong, Air China is up 2.4 percent. Shares of Apple suppliers are under pressure. Largan Precision plummeted 9.3 percent, TSMC is down 1.9 percent, Hon Hai (Foxconn) gave up 2.4 percent, and LG Innotek plunged 7.6 percent. The share price of Apple’s competitor, Samsung Electronics, has slipped by 4.2 percent.

Bonds
Long-dated U.S. government debt yields slipped on Monday as the decline in oil prices softened the inflation outlook. The yield on the policy-sensitive two-year Treasury however added 0.002 percentage point to 4.581%. The yield on the 10-year Treasury note declined 0.035 percentage point to 4.893%. The yield on the 30-year bond dropped 0.041 percentage point to 5.268%.

Analysis
Aryzta Price Target: Berenberg lowers to 60 (70) CHF - Buy
Avolta Rating: RBC downgrades to Sector Perform (Outperform) - Target 50 (52) CHF
Roche Rating: UBS downgrades to Neutral (Buy) - Target 440 (396) CHF


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