October 19th Pre-Market Brief

Good Morning

Social media and fintwit spent the weekend reminding everyone it’s the 39th anniversary of the 1987 crash. The market clearly didn’t get the memo. Last week was a a blood bath for AI/Chip names but really, it looks like it will be a strong day.

I’ll take a green Monday, but I’m not calling it a recovery until Meta and Tesla report Wednesday.

Let's dig in...

Today's Big Picture

1. Chip Stocks Bounce, But AI Lenders Are Still Nervous

Chip stocks are rising premarket after an eight-day losing streak, their longest since 2008. Lenders were still nervous on Friday. Goldman’s traders said AI companies were paying the most extra interest to borrow all year. If those borrowing costs ease, this bounce has firmer footing.

2. France’s Protests Are Driving Up Its Borrowing Costs

More than 500,000 people protested living costs across France this weekend, and some marches turned violent. They want more government spending, and investors doubt a debt-heavy France can pay for it. France’s 10-year borrowing cost is nearing a 20-year high, and French bank stocks are falling. Italy and Greece are seeing the same pressure, so watch whether it spreads.

3. Oil Slips On Iran Deal Talk, But Supply Risks Haven’t Gone Away

Arab news outlet Al-Araby Al-Jadeed reported a U.S.-Iran deal could come this week, though nothing is confirmed. Brent, the global oil price, slipped to about $108 a barrel. Ukraine struck a Russian oil terminal over the weekend, and more Gulf tankers were attacked. Oil for delivery next year is getting pricier, a sign traders expect the trouble to last into 2027.

Market Overview

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Stock Spotlight (pre-market)

Cleveland-Cliffs $CLF ( ▼ 0.25% )  
is up sharply premarket after the steelmaker beat third-quarter estimates. Adjusted earnings came in at 28 cents a share versus 21 cents expected, and it sees profits rising this quarter.

Intel $INTC ( ▼ 5.79% )  
is higher after JPMorgan dropped its sell rating on the chipmaker and moved to neutral. The bank kept an $85 target, below Friday's close, citing better execution under CEO Lip-Bu Tan.

CoreWeave $CRWV ( ▼ 11.91% )  
, which rents out Nvidia chips to AI companies, is rebounding after Goldman Sachs upgraded it to buy. The stock lost about a quarter of its value last week as bond investors worried about its debt.

Applied Digital $APLD ( ▼ 11.48% )  
, which builds data centers for AI customers, is up with its peers premarket. Its president bought 300,000 shares at an average price of $18.86.

Ameriprise Financial $AMP ( ▼ 0.35% )  
is lower after Bank of America cut the wealth manager from buy to underperform. The analyst expects margin-eating retention bonuses after several large advisor teams left to go independent.

SpaceX $SPCX ( ▼ 1.74% )  
is edging higher after Elon Musk pledged one share to every child in America next year. That's roughly $10 billion in stock, and it's not yet clear how the shares would be handed out. The rocket and Starlink satellite company reports earnings tomorrow.

What to Watch

Upcoming IPO’s
MarketBeat did an excellent job on this free IPO guide on IPO’s happening this year

Homebuilder Confidence (10:00 AM ET) This monthly survey of homebuilders reads below 50 when more see conditions as poor than good. September came in at 32, a one-year low, with builders blaming higher mortgage rates and costs. Anything under 32 shows rate hikes biting harder, and a rebound would say buyers are adjusting.

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