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Our US team writes:

PepsiCo (PEP) reported mixed third quarter earnings, missing revenue estimates but beating adjusted earnings per share expectations. To discuss the stock's reaction and the broader snack industry landscape, Bank of America Securities senior consumer goods analyst Bryan Spillane joined Morning Brief.

Spillane notes that PepsiCo stock has "already underperformed the market" throughout 2024, suggesting that the lackluster results were largely priced into the stock.

Addressing shrinkflation concerns, Spillane acknowledges it as "a tactic that has worked very well" for consumer goods companies globally over the past decade. However, he believes PepsiCo "has probably pushed it too far," indicating the company may face "an adjustment period" as a result.

Spillane highlights changing consumer behaviour as a factor affecting PepsiCo's results. He told Yahoo Finance, "It's not that consumers aren't buying food and beverages anymore, but they're really scrutinizing whether they need or are buying things that are maybe off the list when they walked into the store."

Vistry (VTY.L) shares plummeted on Tuesday morning on the back of a profit warning issued after it discovered costs in one division of its business had been understated.

Shares were down more than 30% earlier in the trading session, taking more than £1bn off the company's market capitalisation.

The stock had recovered some ground by midday but was still down more than 24%, with a market capitalisation of £3.2bn ($4.19bn).

The stock was the worst performer on the FTSE 100 (^FTSE) index on Tuesday, weighing on the blue-chip index, which was down 1% in early afternoon trading.

Vistry said in a trading update on Tuesday that it had discovered that cost projections to complete nine of its 46 developments in its south division had been "understated" by around 10% of the total build costs.

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Another US technology company in the red on Monday was Amazon, which closed the previous session 3% down, writes Vicky McKeever.

This came after Wells Fargo downgraded the company's shares from an overweight to equal weight, lowering the price target to $183 from $225.

Wells Fargo analyst Ken Gawrelski cited challenges such as rising competition from Walmart (WMT), as well as moderating contribution from its ad business to operating income, and high costs linked to its satellite broadband project.

"Keeping these headwinds in context, Amazon remains a margin expansion story, just likely a more moderate margin expansion pace than the market expects," Gawrelski wrote.

Amazon shares tumbled back in August after the retail and cloud giant offered a quarterly forecast that fell short of expectations.

Optimism returned somewhat on Tuesday as stock rose 0.6% in early trade.

Shares in tech giant Alphabet closed Monday's session 2.5% in the red, after a US judge on Monday ordered Alphabet's Google to restructure its app store to give users more options as part of a lawsuit with Epic Games.

US district judge James Donato ruled that for three years Google must open its Play store up to Android apps made by competitors.

Lee-Anne Mulholland, vice president of regulatory affairs at Google, said in a statement that the company would appeal against the verdict. She said that the "changes would put consumers’ privacy and security at risk, make it harder for developers to promote their apps, and reduce competition on devices".

Separately, Google is also about to find out what the Department of Justice believes should be done to dismantle the tech giant’s dominance of the online search market.

Prosecutors are expected to submit a document as early as Tuesday in federal court outlining potential remedies after successfully arguing in a landmark trial that Google acted as an illegal monopoly.

In early trade, the stock was around 0.6% higher.

Grocery price inflation rose in September, with average supermarket prices climbing by 2% according to industry data.

Prices were rising fastest in chilled soft drinks, chocolate confectionery and skin care, according to data from analysts Kantar.

The cost of some items fell, with the average price paid for toilet and kitchen roll 6% lower year-on-year, and dog and cat food 4% and 3% cheaper respectively.

Supermarket prices are now 2% more expensive than a year ago, up from August’s 1.7%.

Households responded by sending sales of promoted items up by 7.4% over the month while full price sales rose by just 0.3%. Overall take-home sales across the grocers rose by 2% over the same period.

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The pound (GBPUSD=X) dropped by about 0.1% against the US dollar on Tuesday, at $1.30, the lowest value in more than three weeks. The slip reflects a shift in investor sentiment, with traders paring back their bets on sterling in favour of the safe-haven US currency.

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Oil prices have slipped after hitting a six-week high but are still hovering around the $80 mark amid escalating fears over the conflict in the Middle East.

Brent crude futures dropped 1.5% to $76.69 a barrel, while US West Texas Intermediate (CL=F) crude fell 1.9% to $75.68 per barrel during early European trading.

Brent (BZ=F) has been rising since Israel decided to take military actions against Hamas in Gaza, as well as tensions with Hezbollah in Lebanon and the Houthis in Yemen, all of which are linked to Iran. Since the attack on Israel on October 7 2023, these developments have served as catalysts for rising oil prices.

However, in recent weeks, the market had experienced some stability amid concerns about weakened global demand, particularly from China, and the potential risks of further disruptions to shipping in the oil-rich region.

But further gains in crude were held back by the dollar, as expectations of smaller US interest rate cuts boosted the greenback.

Traders were also watching for the reopening of Chinese markets after a week-long holiday, as the world’s biggest oil importer announced a slew of major stimulus measures.

Meanwhile, the FTSE 100 (^FTSE) was lower at the open, losing 1.2%% to 8,202 points. For more details check our live coverage here.

Pedro Goncalves writes:

Gold prices have slipped for the fifth consecutive day, hitting an over one-week low during early European trading on Tuesday, edging closer to the critical $2,630 support level.

At the time of writing, spot gold was down 0.3% at $2,635.43 per ounce, while US gold futures slipped 0.4% to $2,656.50.

This downward trend is largely attributed to diminishing expectations for a substantial interest rate cut by the Federal Reserve in November, which has undermined demand for the non-yielding yellow metal.

Despite this decline, gold's downside remains somewhat cushioned by a modest weakening of the US dollar, which typically supports USD-denominated commodities.

Geopolitical tensions, particularly ongoing conflicts in the Middle East, may also provide some support for gold prices as investors seek safe-haven assets. However, many traders are likely to adopt a cautious stance, refraining from making aggressive directional bets ahead of the upcoming release of the FOMC meeting minutes on Wednesday.

In addition, key economic indicators such as the US Consumer Price Index (CPI) and the US Producer Price Index (PPI), scheduled for release on Thursday and Friday respectively, are expected to influence short-term dollar dynamics and offer new momentum for gold prices.

Housebuilder Vistry (VTY.L) stock is tanking in early trade, down almost 30% after it posted a profit warning on Tuesday.

Anthony Codling from RBC Capital markets said:

Cold water was poured on a stock market rally China on Tuesday after a widely expected stimulus package from the central bank failed to materialise. The Hang Seng (^HSI) lost 5.6%. Other Chinese indices gained after a holiday break last week, with the SSE Composite (000001.SS) jumping 4.6%.

Over in Japan, the Nikkei (^N225) fell 1%.

US indexes are currently slightly lower in premarket trade.

Here's how things played out on Monday, from our US team:

US stocks slipped on Monday and the 10-year Treasury yield (^TNX) jumped past 4% for the first time since August ahead of a week of key inflation data and the start of earnings season.

The Dow Jones Industrial Average (^DJI) fell 0.9%, around 400 points, after notching a fresh record high as stocks soared to close last week. The S&P 500 (^GSPC) shed almost 1%, while the Nasdaq Composite (^IXIC) dropped nearly 1.2% as Big Tech names led the pair lower.

Stocks veered to session lows in afternoon trading after a judge ordered Alphabet (GOOG, GOOGL) to open up Google's app store business, Google Play, to more competition. Amazon (AMZN) fell over 3%, while Microsoft (MSFT) lost over 1.5%. Chip heavyweight Nvidia (NVDA) was the only gainer among the "Magnificent 7" members.

Oil futures jumped more than 3.5% on Monday, extending their biggest weekly gains in over a year as traders price in whether Israel's expected response to Iran's recent attack will involve targeting the country's petroleum fields.

Hello from London. Lucy Harley-McKeown here for another day of markets news.

Today German chancellor Olaf Scholz is hosting the heads of the OECD, IMF, ILO, WTO and World Bank for talks.

In the UK there's an update on retail sales from the British Retail Consortium and a report from Barclays on consumer spending trends.

In terms of corporate updates, Pepsico (PEP) is reporting results.

Let's get to it.