October 22nd Pre-Market Brief

Good Morning

Three green days in a row felt good while it lasted. Meta and Tesla beat last night, and the market sold them off. I’m not reading too much into one red morning but it’s a nasty one.

Let's dig in...

Today's Big Picture

1. The Money Behind AI Is Getting Tight

Nvidia CEO Jensen Huang said this morning that AI cloud companies have more demand than money to meet it. Meta turned lower after flagging how much money its AI build will need, Wells Fargo traders said. Tesla cut this year’s spending plan to $20 billion from $25 billion. That could mean fewer chip orders, and chipmakers are leading the drop.

2. Gold Is Falling on War News

Brent crude topped $112 after The New York Times reported U.S. and Israeli plans to strike Iran after the Nov. 3 midterms. Gold fell anyway. Higher oil means more inflation and possibly more Fed rate hikes, and gold pays no interest. The safety money is going to Treasurys instead, pushing their yields lower.

3. France Now Pays More to Borrow Than the U.S.

That hasn’t happened since 2013. France’s 10-year rate hit a 24-year high as riots and a budget standoff push foreign lenders toward the exit. The extra interest France pays over Germany is now the highest since 2011. If it keeps climbing, the European Central Bank may have to step in.

Market Overview

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Stock Spotlight (pre-market)

Lam Research $LRCX ( ▼ 1.0% )  

is falling premarket because its outlook barely beat estimates, and investors expected more from AI suppliers. The chip equipment maker guided next-quarter sales to $8.60 billion, against $8.53 billion expected.

IBM $IBM ( ▲ 3.94% )  

falling premarket with the tech selloff, erasing an after hours gain from its earnings beat. It earned $2.95 a share, above the $2.86 expected, but its CEO said clients are questioning AI spending.

Procter & Gamble $PG ( ▼ 1.56% )  

rising premarket after shoppers bought more of its products, led by laundry and home care. The Tide maker earned $2.00 a share against $1.88 expected, on $23.3 billion in sales.

Lockheed Martin $LMT ( ▲ 0.51% )  

rising premarket after beating estimates and raising its 2026 forecast on missile demand. Its order backlog hit a record $292 billion, including a $52.5 billion award for Patriot interceptors.

American Airlines $AAL ( ▲ 1.03% )  

is falling premarket after raising its 2026 loss forecast to as much as $1.60 a share on jet fuel costs. Delta $DAL, United $UAL and Southwest $LUV all cut their outlooks this month on fuel too.

Spotify $SPOT ( ▼ 0.14% )  

rising premarket because its fourth quarter profit forecast topped estimates, outweighing a slight third quarter miss. It also expects to add 10 million paying subscribers this quarter, reaching 316 million.

What to Watch

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

Western Digital (After the Close)
Western Digital makes hard drives for cloud data centers and is the next AI supplier to report. It beat estimates last quarter and the stock still fell hard. If it beats tonight and falls again, the selling in AI hardware has little to do with results.

Anthropic’s IPO Filing (As Soon as Friday)
Anthropic, maker of the Claude chatbot, could make its IPO paperwork public as soon as Friday, Yahoo Finance reports. Wall Street expects a raise of up to $100 billion, after a first-half loss of $80.7 billion. That filing is the next test of who pays for the AI build.

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