SpaceX Jumps 8.86% Overnight as Wells Fargo Flashes Rare 'Buy' Signal

SpaceX stock rocketed 8.86% in overnight trading after the company's Q3 earnings solidly beat analysts' expectations, and Tesla climbed 1.42% alongside it. Nasdaq futures were up 0.43% before the open in New York. Both of Elon Musk's companies rose post-market, per the report, setting a constructive tone for U.S. tech.

Traders woke up in a cheerful mood, shaking off the riots in France and the rising price of oil. U.S. futures were broadly higher. S&P 500 futures gained 0.24% this morning, after the index rose 0.28% yesterday.

What's moving across global markets?

Asia was mixed but European indexes rose in early trading. The picture by region:

• Europe: The Stoxx 600 rose 0.54% in early trading. The U.K.'s FTSE 100 was up a marginal 0.03% before lunch.
• South Korea: The KOSPI surged 3.29%.
• Japan: The Nikkei 225 gained 0.85%.
• India: The Nifty 50 slipped 0.66%.
• China: The CSI 300 fell 0.97%.
• Commodities and crypto: Brent crude traded at $110 per barrel. Bitcoin sat at $83,346.

The split is stark. Seoul's 3.29% rally against Shanghai's 0.97% decline shows risk appetite isn't uniform — it's selective.

Why did Wells Fargo trigger a 'buy' signal?

The recent selloff has moved Wells Fargo's "Sentiment Indicator" into "buy" territory. Translation: the bank's model senses that other investors' moves in the markets are too bearish, and you should bet against them.

The track record behind the signal is what makes it worth watching. The S&P 500 has risen 89% of the time after the signal appears, by 6.5% on average over the next three months, according to Ohsung Kwon and his colleagues at Wells Fargo. That's a hit rate most systematic strategies would envy — nine correct calls out of ten, with a mid-single-digit percentage payoff per quarter.

Kwon's team also noticed something else: retail traders are coming back into the market. So the contrarian signal is firing at the same moment small investors are re-engaging, not fleeing.

Where will earnings growth actually come from?

A chart from Glenmede breaks down projected Q3 earnings in the S&P 500. The index is expected to generate $180 billion in the quarter, and $116 billion of that — nearly two-thirds — will come from the Magnificent Seven companies and the rest of the tech industry.

The math works like this, as the report notes: the index reported $618 billion in the previous quarter, and adding the $180 billion expected Q3 gain brings the total to $798 billion.

What does this change for portfolio managers and retail allocators? It sharpens the concentration question. If roughly 65 cents of every new earnings dollar comes from a handful of mega-cap tech names, index-level exposure is already a tech bet — whether you intended one or not. And with SpaceX's earnings beat reinforcing the sector's momentum, the burden of proof now sits with anyone betting on broad-based, non-tech earnings growth for the rest of the quarter.