October 26th Pre-Market Brief

Good Morning

Green open after two straight losing weeks.

The big stuff comes midweek, with the Fed and earnings from Alphabet and Microsoft on Wednesday, Amazon on Thursday. Those earnings will tell us if the market thinks the AI spending boom is still going to stretch.

Let's dig in...

Today's Big Picture

1. Investors Bet Wrong on Brazil’s Election

Investors piled into Brazil because polls and betting odds favored Flávio Bolsonaro. President Lula won Sunday’s runoff instead, and the iShares MSCI Brazil ETF $EWZ faces its worst day ever. U.S. holders lose twice, on the stocks and the currency, and MercadoLibre $MELI leads Nasdaq-100 losers. Bolsonaro is refusing to concede and wants the result thrown out, so the uncertainty isn’t over.

2. The AI Cloud Selloff Started in the Bond Market

Elon Musk says lenders have cut off companies whose only business is renting out AI chips. CoreWeave , Nebius and Iren are lower again premarket. The bond market saw it first, when the cost to insure CoreWeave’s debt hit levels that usually signal trouble. Musk also competes with them, and he says SpaceX just borrowed $40 billion for Nvidia chips.

3. Oil Has About $20 Riding on Trump’s Iran Call

Trump says it’s “getting to be decision time” on a deal with Iran or more strikes. Gallo Partners’ Michael Alfaro figures the war adds about $20 a barrel to crude, now just above $100. A deal could take some of that out, and new strikes could add to it. His bigger worry is refining, which he says could keep gas and diesel prices high into 2027.

Market Overview

Today’s Sponsor

The goat-herding company that hedged a wage law

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See how hedging works

Stock Spotlight (pre-market)

Meta Platforms $META ( ▼ 0.96% )  

is higher after unveiling plans to sell up to $95 billion in stock to fund AI. Chipmakers Nvidia, AMD and Broadcom may buy up to $5 billion of it. Last quarter Meta burned more cash than it made for the first time since 2012.

Range Resources $RRC ( ▲ 3.79% )  

is higher after EQT $EQT ( ▲ 1.76% ) agreed to buy the natural gas producer in an all stock deal. EQT, the buyer, is lower, and together they’d be worth over $50 billion including debt.

Tesla $TSLA ( ▼ 0.63% )  

is higher after Barclays upgraded the electric carmaker to overweight, its version of a buy rating. The bank cited a possible SpaceX merger, robotaxi growth and a solid core car business.

Moderna $MRNA ( ▼ 5.4% ) is lower again because its cancer vaccine worked, just not as well as investors priced in. Saturday’s full data showed the Merck-partnered shot cut melanoma relapses by less than an earlier, smaller trial. The stock had run from about $63 to $246 since August.

Surgery Partners $SGRY ( ▼ 0.94% )  

is sharply higher on a report that Bon Secours Mercy Health is close to buying control. The Financial Times says the surgical care provider would fetch $20 a share, or about $6 billion with debt.

Fair Isaac $FICO ( ▼ 5.28% )  

is lower after Wells Fargo cut the credit score company to a neutral rating. Fair Isaac said it won’t raise prices on its FICO scores, so Wells sees weaker near-term earnings.

What to Watch

Who Pays for Anthropic’s IPO (Today)
Anthropic made its IPO filing public this morning and expects a deal at least as big as SpaceX’s. Chip stocks rose ahead of it on the idea that more AI fundraising means more chip orders. But Baird’s Ted Mortonson says big funds hold little cash, so buying in means selling something else. With Meta selling stock too, I’d watch whether funds trim the AI winners they already own.

Today’s Sponsor

B2B support leaders who made AI work

AI agents are reshaping B2B support, and a few leaders are already ahead. Join Victoria Lowney of Inside Real Estate and Alex Rivas of HoneyBook as they share how they launched, scaled, and what's next. Hear how they built the business case, connected AI to data and systems, and reshaped team roles. Live Q&A. Register now to save your spot and get the recording.

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