The Nasdaq fell about 2.6% as Meta and the chipmakers slid, while P&G and Lockheed rallied. The 10-year yield fell below 5%. Bitcoin fell about 3.6% from Wednesday's U.S. close, and crypto stocks fell further.
The AI selloff hit chips and the power names that supply data centers, and defensive beats drew the buyers.
The S&P 500 closed down about 1.2% and the Nasdaq Composite about 2.6%. The Dow ended roughly flat. The Philadelphia chip index fell about 6.7%.
Meta's default swaps hit a record, and the stock's drop went from 1.6% to 7%. Meta (META) reported negative free cash flow of $2.12 billion, and the cost of insuring its debt climbed.
Chipmakers fell 6%. Power and turbine stocks fell more. GE Vernova (GEV) lost about 10.6% and Vistra (VST) about 9.8%. Lam Research (LRCX) dropped about 11.8% after its finance chief said supply limits held back its forecast. AMD (AMD) fell about 8%, and Nvidia (NVDA) about 4.4%.
P&G grew volume 2.4% and held its forecast, while absorbing $400 million more in costs. Procter & Gamble (PG) rose about 5.6%.
Lockheed raised its cash forecast by $800 million and lifted its 2026 outlook. Lockheed Martin (LMT) gained about 7%.
Spending Became the Risk
Thursday's tape treated AI spending as a cost, not an order book. Meta's cash flow went negative and its swaps hit a record, and the selling hit both chips and the power names that supply data centers. Buyers moved to P&G and Lockheed, whose beats came with higher volume and a raised outlook. Cash flow was the line investors graded first on Thursday.
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Aramco told staff to leave its headquarters, and this time Brent held its gain.
Aramco told staff to leave its Dhahran headquarters, Reuters reported. Houthi forces also claimed strikes on Aramco sites in Yanbu, which Riyadh has not confirmed.
Brent rose about 4% to near $113, its highest since May. U.S. crude was near $99 late in the session. Energy stocks slipped even as crude climbed.
The Hub Is in Range
On Wednesday, Brent's spike faded within hours. On Thursday, the gain held as reports centered on Aramco's headquarters and its Red Sea export sites. Energy shares slipped anyway, so equity buyers did not chase the move. The premium now rests on Saudi infrastructure, not only on the strait.
Bonds rallied through a low jobless-claims reading, and Fed hike bets were cut in half.
The 10-year yield fell below 5% even as Brent hit a five-month high. It was the first trip below 5% since Sept. 23. Two-year yields fell nearly as much.
Jobless claims fell to 194,000, below the 200,000 economists expected. Continuing claims rose 25,000 to 1.728 million.
Traders halved the odds of an October Fed hike in one session. Kalshi's quarter-point hike contract fell to 6 cents from 12 cents. Polymarket's no-change contract rose to 93.5 cents.
Mortgage rates eased to 7.32%, and homebuilder stocks rallied even as two builders missed forecasts. PulteGroup (PHM) rose about 5.9% and NVR (NVR) about 3.6%.
Bonds Moved Before the Data
Thursday's bond rally ignored the day's labor data. Claims came in low, yet the 10-year fell below 5% and traders sold October hike bets with no Fed official speaking. Homebuilders rose as yields fell, even after two missed estimates. One reading is that the market is pricing slower growth ahead of the data.
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Private money kept arriving, and the exits were uneven.
Blackstone raised $63.3 billion but cashed out less. Inflows beat forecasts, and assets reached $1.37 trillion. Realized performance revenue fell 38%.
Investors in BCRED, its private credit fund for individuals, asked to withdraw 10% of assets, double the quarterly limit. Blackstone paid about half. Blackstone (BX) still rose about 8.4%.
LSEG will pay $3.5 billion in cash for Octus. Permira's funds are selling the credit-data provider four years after buying it. Permira says it is the firm's sixth strategic exit this year.
Money In, Money Stuck
Private markets showed both ends of the pipe on Thursday. Blackstone pulled in far more than forecast, while its retail credit fund paid out about half of what holders asked. Permira found a clean exit by selling for cash to a strategic buyer. On Thursday, raising money was the easy part. Getting it back out depended on who was buying.
Bitcoin did its falling overnight, and the stocks built on it fell harder.
Bitcoin barely moved after the open. Bitcoin stocks fell as much as 9%. Bitcoin was near $81,400 at the close of U.S. trading, down about 3.6% from Wednesday's U.S. close but little changed after the open. That is close to the estimated $81,500 average cost of U.S. spot bitcoin ETF holders.
By the close, Galaxy Digital (GLXY) had fallen about 9.7%, IREN (IREN) about 8.4% and Riot Platforms (RIOT) about 8.1%. Strategy (MSTR) fell about 5% and Coinbase (COIN) about 4.5%.
Ethereum's next upgrade was pulled from its final test network. Security firm ChainSecurity said it found 13 real-world examples of contracts that Glamsterdam's gas changes could make behave unsafely. The Oct. 26 test activation is off, and no mainnet date has been set.
Robinhood won a Dubai license covering crypto and custody. It will not launch until 2027. Robinhood (HOOD) fell about 5.3% with the group.
A report put Fireblocks at $2.5 billion in talks with Visa, about 69% below its 2022 valuation. Fireblocks called the Axios report "not true at present time," and Visa (V) declined to comment.
The Wrapper Took the Hit
Bitcoin did most of its falling overnight, and crypto stocks gapped lower with it at the open. The miners and Galaxy kept falling through the session, while Strategy and Coinbase ended near their opening prices. Treasuries, not bitcoin, drew the safety bid. On Thursday, the AI trade moved the miners as much as the coin did.
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Thursday priced who pays for AI, and who pays for the Gulf.
Meta's cash flow and Lam's supply-capped forecast came as selling hit chips and power, while P&G and Lockheed drew buyers. Brent held near $113 after reports that Aramco told staff to leave its headquarters, and the 10-year still fell below 5%. Blackstone took in far more than forecast while its retail fund rationed withdrawals, and bitcoin slipped while its stocks fell harder.
Rates Just Reset. Who Feels It First?
On January 2, the 10-year yielded 4.19%. By September 30, 5.29% — most of it in one quarter.
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