SpaceX Jumps as Musk Backs Tesla Merger Talks

Summary

SpaceX shares rose sharply in extended trading after Elon Musk called a merger with Tesla a good idea and said special committees were discussing a tie-up that would create a company worth about $3.5 trillion. Australia’s NextDC lost nearly half its value after slashing revenue forecasts, while Korea’s Elice Group surged 30% after a weak debut. S&P 500 futures rose and FTSE futures were flat. Brent climbed above $110 on Middle East supply concerns.

Equities

The FTSE 100 fell 0.29% to 10,733.00 on Tuesday as banks and commodity stocks weighed, while the FTSE 250 slipped 0.06% to 24,364.76.

UK inflation rose to 3.5% in September from 3.1% in August, data showed early this morning, above forecasts of 3.4% and the highest since October 2025, driven by higher petrol and diesel costs. Services inflation climbed to 3.7% and core inflation rose to 2.8%.

Traders have almost fully priced in a quarter-point Bank of England rate rise in November, after data on Tuesday showed pay growth edging up and payrolls rising in September.

Banks fell 0.8% on Tuesday to a more than four-month low, with HSBC, Lloyds and NatWest down between 0.8% and 1.2%. BP lost 1.7% and Shell slipped 0.7% as oil prices eased from a five-month high.

Anglo American fell 2% on Tuesday after keeping its 2026 copper production guidance despite a 5% drop in third-quarter output. National Grid rose 1.8% and housebuilders climbed 3.3% to their highest level since 2 October.

Ocado jumped 6.6% on Tuesday to top the FTSE 250 after J.P. Morgan raised its price target to 460p from 290p.

The Dow Jones Industrial Average rose 1.02% to 52,495.88 on Tuesday and the S&P 500 gained 0.28% to 7,712.57, while the Nasdaq slipped 0.02% to 26,424.82. Healthcare stocks hit a record high, led by Eli Lilly, and the small-cap Russell 2000 climbed 1.7%.

Equifax rallied 11.3% on Tuesday after beating third-quarter profit forecasts, and Hasbro jumped 11.2% after the toymaker raised its full-year revenue and digital gaming forecasts. 3M rose 5.8% after expanding its data-centre partnership with Amazon and raising its full-year profit forecast.

General Motors sank 6.8% on Tuesday after warning of pressure from higher commodity costs and lower truck sales. Meta fell 1.6% and Alphabet lost 1% ahead of Meta’s results on Wednesday, when Tesla also reports.

After the bell on Tuesday, Netflix fell 6% after issuing a weaker-than-expected fourth-quarter profit forecast, having closed 1.7% lower. SpaceX rose 4% in late trading after third-quarter profit beat estimates.

Forex & Commodities

The US dollar was steady early this morning at 101.8 against a basket of currencies, after falling on Tuesday and briefly touching 101.5, its lowest level since October 1. Against the yen, the dollar was flat at 158.2 yen. The euro was down at $1.122 as France prepared a large security operation, including troops, for further protests planned on Saturday, while the British pound edged down to $1.337.

The Australian dollar rose to $0.7016 early this morning, after touching a three-week high, when Reserve Bank of Australia Deputy Governor Andrew Hauser said the inflation outlook looked materially worse. The New Zealand dollar slipped to 1.406 against the greenback.

The Federal Reserve, European Central Bank and Bank of Japan announce policy decisions on consecutive days from next Wednesday, with no rate changes expected. The Reserve Bank of New Zealand and Bank of Canada also decide on Wednesday, with traders betting on quarter-point hikes from both. Economists widely expect the Fed to hold this month and raise rates in December, with markets pricing a 15% chance of an October hike and an 88% chance of a December move.

Spot gold slipped 0.1% to $4,119 an ounce early this morning, falling for a fourth straight session as higher oil prices added to inflation concerns. Silver was down at $57.35, platinum fell to $1,639 and palladium dropped to $1,092.

Oil prices rose early this morning, with Brent crude up 1.5% at $110.4 a barrel and WTI up at $99.27. Brent touched $112.0 on Tuesday, its highest since May 20, before easing. US crude stocks fell by 4.9 million barrels in the week to October 16, while at least 18 vessels were attacked in the region over the past two weeks.