October 21st Pre-Market Brief

Good Morning

Ken Griffin sees AI bubbles, and said last night he wishes he’d kept his Amazon stock from the dot-com days. Don’t we all, Ken. Meta and Tesla report tonight, and I’m hoping for more Amazon than bubble.

Let's dig in...

Today's Big Picture

1. SpaceX’s AI Boom Runs on Shortage Prices

SpaceX’s AI unit, which rents out computing power, made $7.6 billion last quarter, more than rockets and Starlink combined. Chips are so scarce that SpaceX says the equipment pays for itself in under a year. MoffettNathanson sees rental rates falling from about $10 an hour to $4, a risk for CoreWeave and Nebius too.

2. The U.S. Still Pays More to Borrow Than France

France’s 10-year borrowing cost hit its highest level since 2002 after weekend riots raised doubts it can cut spending. The U.S. still pays more than France to borrow for 10 years, and mortgage rates follow that number. Mortgage applications fell again last week, even though rates dipped for the first time in two months.

3. Iran Is Now Targeting the Oil Workaround

Gulf oil exports topped prewar levels last week, helped by tankers transferring cargo near Oman under U.S. protection. Iran is now attacking ships in those waters too, LSEG analysts say. Brent is still above $100 with supply back, partly because shipping costs are near record highs.

Market Overview

Today’s Sponsor

Invest Alongside a Manager with a 40-Year Track Record

Private real estate has long been a cornerstone of institutional portfolios, but individual investors have often had limited access to the asset class - or have had to invest through pooled funds and intermediaries.

Lightstone DIRECT offers a different approach. Accredited investors can invest directly in select real estate opportunities alongside Lightstone, a vertically integrated owner/operator with more than four decades of experience and a $12 billion real estate portfolio.

We invest 20% or more of the equity in every offering, aligning our interests with yours from day one. Our in-house team oversees acquisitions, asset management, and investment execution, with property operations managed by Lightstone and, where appropriate, experienced third-party operators.

No blind funds. No intermediaries. Just direct partnership.

Accredited Investors only. $100k minimum investment.

Explore Opportunities

^{This communication is for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any securities. Any such offer or solicitation will be made exclusively through the definitive offering documents. All investments involve risk of loss, including the potential loss of principal. Past performance is not a guarantee of future results. Any targeted returns or projections are forward-looking statements, are based on current assumptions, and are not guarantees of future performance. Actual results may differ materially.}

Stock Spotlight (pre-market)

Netflix $NFLX ( ▼ 1.66% )  
is falling premarket after guiding fourth-quarter sales to $13.44 billion, below the $13.52 billion expected. The streamer also cut its ad revenue outlook and posted its slowest sales growth in years.

AT&T $T ( ▲ 0.95% )  
is sliding premarket after SpaceX said its Starlink phone service could launch in early 2028, competing directly with carriers. A small miss on new phone customers added to it, and Verizon $VZ and T-Mobile $TMUS are lower too.

Super Micro Computer $SMCI ( ▲ 1.15% )  
is rallying premarket after raising its quarterly sales outlook to as much as $19.5 billion, from $15.5 billion. The AI server maker credited AI demand, and rivals Dell $DELL and Hewlett Packard Enterprise $HPE are rising too.

Intuitive Surgical $ISRG ( ▼ 3.87% )  
is sliding premarket after trimming the top of its forecast for surgeries performed with its robots this year. That overshadowed a beat, with the da Vinci maker earning $3 a share against $2.64 expected.

Nvidia $NVDA ( ▼ 0.29% )  
is higher premarket after unveiling a shipping-container data center that it says cuts setup from six months to two weeks. It also signed deals to expand supplier capacity, sending chip packager Amkor $AMKR sharply higher.

Philip Morris International $PM ( ▼ 0.57% )  
is lower premarket after its full-year earnings forecast came in below estimates. That overshadowed a third-quarter beat for the tobacco giant.

What to Watch

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

Meta Earnings (4:30 PM ET Call)
Meta’s spending is sales for Nvidia and the AI supply chain that rallied on SpaceX this morning. A bigger plan backs SpaceX’s demand story, but Meta’s own stock fell after each of its last two reports.

Tesla Earnings (5:30 PM ET Call)
Musk owns just under a fifth of Tesla and has said he’s uneasy running it with less than a quarter. A merger with SpaceX, where he holds super-voting shares, could solve that. It needs more than half of Tesla’s shares to pass, a hurdle Musk himself called high.

Today’s Sponsor

The most accurate voice to text on the market

Leave Granola and get up to 12 months free of Wispr Flow Notetaker + Dictation

If you have paid time left on an individual Granola plan, we'll match it with a Wispr Flow subscription that includes Notetaker and dictation, and add bonus time, up to 12 months total. Sign in or create a Wispr account and submit proof of your plan to check eligibility.

Try Notetaker Free