TQ Morning Briefing
Brent slipped from its highest settle since May after Washington waived new Russia penalties. Nasdaq futures bounced after the index's worst week since June. Every major lender backed EQT's buyout of a waste company. Meta reports Wednesday.
Bonds Had the Good Week. Stocks Want One Now.
Futures bounced early Monday.
Last week the Nasdaq fell 4.5% and the S&P 500 fell 1.9%, both their worst weeks since June. The Dow rose 0.7%. The Philadelphia chip index lost 11.4% and fell eight straight days, its longest losing streak since 2008, Bloomberg reported.
Bonds went the other way. The 10-year yield closed Friday at 5.09%, down from 5.24% a week earlier. On Friday, Polymarket priced the 10-year closing at 5.4% or higher before 2027 near 36 cents, from about 62 cents a week earlier.
Kalshi's October hike contract traded at 12 cents early Monday. The VIX ended the week near 20.
Market Implication
Money got cheaper last week for the Treasury. The bounce assumes it gets cheaper for AI's builders too.
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Oil Fell Despite a Weekend of Mine Claims
Brent fell as much as 2% overnight and was down about 1% by 6:30 a.m. On Friday it had settled at its highest since May.
Iran's Revolutionary Guards said tankers using what they call an unauthorized route through Hormuz hit mines. Those claims have not been independently confirmed.
Reuters tied the drop to Washington's decision to waive new Russia sanctions and tariffs. Phillip Nova's Priyanka Sachdeva said the move does little about the physical disruption at Hormuz.
Dated Brent, the price of cargoes loading in the coming weeks, was assessed near $126 a barrel on Thursday, about $20 above futures. Polymarket's contract on a U.S. announcement ending the Iran blockade by Oct. 31 traded near 10 cents early Monday, up from about 4.5 cents Friday afternoon.
Structural Setup
Futures are trading Washington's levers. Cargo buyers were still paying for the strait Thursday. If that roughly $20 premium holds while futures fall, Monday's drop is positioning, not new supply.
Buyers Went Back to AI. China's Biggest DRAM Maker Didn't.
Broadcom (AVGO) rose 2.3% before the bell, Nvidia (NVDA) 1.1% and CoreWeave (CRWV) 1.3%, Reuters reported.
China's biggest DRAM maker went the other way. CXMT guided to nine-month profit of up to 132.5 billion yuan, against a loss a year earlier. Its shares fell more than 7% in Shanghai Monday, to their lowest since its July listing.
The quarter inside that guidance may explain the gap. By our math, third-quarter revenue rose 15% to 20% from the second quarter. Profit rose only 1% to 4%.
Crypto stocks traded with the AI builders Friday. Strategy (MSTR) fell 9.6% and Coinbase (COIN) 5.8%. Bitcoin traded near $82,000 at 6:30 a.m., up about 2% from Sunday afternoon's low, alongside Nasdaq futures.
Sector Read
The tape is separating AI demand from AI margins. CXMT shows the split. Its third-quarter revenue rose 15% to 20% from the second quarter, while profit rose only 1% to 4%. Its shares still fell to their lowest since the July listing. In memory, revenue growth no longer clears the bar on its own.
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Congress Wrote the Russia Tariffs. The White House Used the Exit.
Congress passed the Graham Act with bipartisan support, and Trump signed it on Sept. 18. It authorized tariffs of up to 100% on the biggest buyers of Russian oil and gas.
On Friday evening, two days before those measures were due to take effect, Trump waived them by executive order.
The waiver may not hold. Secretary of State Marco Rubio said the president will take up to 60 days to assess the economic impact. Trump later said a final decision had not been made, Reuters reported.
Watch Signal
Monday's discount in Brent rests on a decision the White House calls unfinished. A reversal, or a push in Congress to force the tariffs, would hand that discount back.
Lenders Have Money. They're Picking Borrowers.
EQT Infrastructure signed a binding deal to buy Australia's Cleanaway for A$3.095 a share in cash. That values the waste company at about $9.3 billion including debt, roughly 20 times its fiscal 2026 operating profit.
EQT lined up about A$5.6 billion of debt with support from every major lender, the Australian Financial Review reported. Cleanaway shares closed up about 20% at $2.97, about 4% below the cash price.
Now compare Volta's $5 billion AI loan last week. It priced at 6.5 percentage points over the benchmark rate, at 95 cents on the dollar, Bloomberg reported. Banks underwrote only the $1.3 billion piece, which funds Volta's data-center lease payments. The $3.7 billion that finances its Nvidia chips was sold on a best-efforts basis.
The money exists. Direct-lending funds raised 35% more in the first nine months than a year earlier, Preqin data show. Estimated third-quarter lending fell 28% from a year earlier, PitchBook LCD said.
The Read
Credit is not tight. It is choosy. A waste company with municipal contracts drew every major bank. An unrated first-time AI borrower got best efforts on its chip loan. A lower Treasury yield won't close that gap.
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Economic Data: NAHB housing index, 10 a.m. today. Housing starts and permits, Tuesday at 8:30 a.m. Treasury's 20-year bond sale, Wednesday, results at 1 p.m.
Fed Speakers: None. The quiet period runs through Oct. 29, after the Oct. 28 decision.
Earnings: Fifth Third reported before the open. Steel Dynamics and W.R. Berkley, after the close. GM, RTX and GE Aerospace, Tuesday before the open. Netflix, Tuesday after the close. Meta (META) and Tesla (TSLA), Wednesday after the close.
Overnight: Nikkei -0.62% | Shanghai +0.39% | FTSE -1.16% | DAX -1.28%
Last week the market decided the price of money was the problem.
Treasury yields fell anyway. A waste company drew every major bank. An unrated AI borrower got best efforts on three-quarters of its loan.
So this bounce rests on cheaper Treasurys, while AI’s borrowers pay a spread that a lower yield doesn’t touch.
Wednesday puts both on one afternoon. Treasury sells 20-year bonds at 1 p.m., and Meta reports after the close. A clean sale and a spending number the chip stocks can hold would give this bounce a floor. If Meta spends more and the stocks fade anyway, the market is still pricing the money, not the demand.
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.
Some companies earn from higher rates. Some pay. Each runs on a different clock.
We traced three: IBKR, WRB and FIS. One has already reported. The other two report next, and the report tells you the exact line to check.
Free report, texted to your phone.