October 16th Pre-Market Brief

Good Morning

Tech took its lumps this week, but the Dow is still on track for a weekly gain. After eight straight down days for chip stocks, a flatish open outside tech feels like a small win. We’re almost to the weekend.

Let's dig in...

Today's Big Picture

1. Traders Read a Signal Warsh Never Sent

Traders cut October rate-hike odds nearly in half after Fed Chair Kevin Warsh gave no hint overnight. But Warsh stopped giving hints when he took over in May. Then prices on imported goods rose more than expected, the third inflation report this week to do that. Treasury yields are higher this morning, a sign bond investors doubt the pause.

2. AI Stocks Are Splitting by Who Has to Borrow

CoreWeave $CRWV is falling again today, erasing Thursday’s bounce after Nvidia’s CEO defended it. Its bonds now pay about three times what the U.S. government pays to borrow. Microsoft $MSFT and Alphabet $GOOGL pay for AI with cash and have held up all week. Higher rates now decide which AI stocks fall, and borrowers go first.

3. Oil’s Next Risk Comes After Nov. 3

Trump says U.S. strikes on Iran won’t resume before the midterms, with Brent already near $105. Reuters reports the White House also slowed Ukraine’s military Starlink while pressing Kyiv to stop hitting Russian refineries. Officials are reportedly planning a bigger Iran offensive after the election. That lands ahead of the Fed’s December meeting, where markets already expect a rate hike.

Market Overview

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Stock Spotlight (pre-market)

Tesla $TSLA ( ▼ 1.29% )  

higher premarket after unveiling its long-delayed Roadster, a sports car that hovers on SpaceX-built thrusters. The demo has investors focused on ties between Musk’s companies, though production doesn’t start until 2028.

Netflix $NFLX ( ▼ 1.12% )  

lower premarket after content chief Bela Bajaria’s exit, with former Disney executive Peter Rice taking her job. It comes a day after the streamer announced about 1,000 job cuts, with earnings due Tuesday.

Travelers $TRV ( ▲ 1.61% )  

lower premarket as losses from wind and hail storms rose to $538 million from $402 million a year ago. That’s weighing on the insurer despite profit of $9.18 a share, well above the $7.42 expected.

Truist $TFC ( ▲ 2.19% )  

lower premarket after the regional bank’s adjusted profit of $1.16 a share missed the $1.19 forecast. It also booked a $1.4 billion loss selling bonds to reshape its balance sheet.

Strategy $MSTR ( ▼ 3.6% )  

lower premarket after index provider MSCI adopted rules that could drop the bitcoin-holding company from its indexes in November. Index funds would then have to sell about 13 million shares, which Strategy says is less than a day’s trading.

Varonis $VRNS ( ▲ 2.77% )  

higher premarket after the data security company agreed to be bought by Proofpoint for $49.75 a share in cash. The roughly $6.3 billion deal is expected to close in the first half of 2027.

What to Watch

The Fed Goes Quiet (Starting This Weekend)
Fed officials stop public comments this weekend until the Oct. 27-28 decision. That means no Fed voice can push back if traders lean harder into a pause. Any reset in hike odds now has to come from the data.

Rubio Visits the World’s Largest Refinery (Starts Saturday)
Secretary of State Marco Rubio’s trip includes Reliance’s Jamnagar refinery in India. Advisers say it is built for export and could supply diesel to the U.S. before the midterms. A deal would ease diesel without relying on Russian refineries that Ukraine keeps hitting.

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