October 6th Pre-Market Brief

Good Morning

Futures are up and the S&P 500 is set up for a record close. Bond yields backed off and oil slipped under $100, a combo I'll take any morning.

10 of 11 sectors finished green two days in a row, which we haven't seen since April 2025. Tech has been carrying the team since August, so it's nice to see the rest of the roster getting some green.

Let's dig in...

Today's Big Picture

1. Government Debt Is Driving Bond Yields

A weak jobs report should have pulled bond yields down. Instead, the 10-year Treasury yield hit its highest level since 2002 on Monday. Japan, Britain and France are seeing the same selloff as investors worry about how much governments borrow. That means a softer Fed alone may not bring mortgage and loan rates down.

2. Cheaper Oil Isn't Reaching the Diesel Pump

Damaged Gulf refineries mean only about a tenth of the oil leaving Hormuz is diesel and other ready-to-burn fuel. Trump's new tax break trims about 24 cents from a gallon that hit a record $6.53 last month. Goldman sees diesel staying expensive through 2027. Refining executives don't seem so sure: insiders at PBF Energy $PBF and Par Pacific $PARR are selling their own shares at record highs.

3. Nvidia Is Where Money Hides From High Rates

$NVDA closed at a record yesterday, about $200 billion shy of becoming the first $6 trillion company. Investors pay about $17 for each dollar of its expected profit next year, versus $19 for the S&P 500. Strong growth at a discount pulls in money whenever rates rise. That flow is why the S&P 500 sits near a record while its typical stock is well below its own high.

Market Overview

Today’s Sponsor

10 Stocks at the Center of AI’s $1 Trillion Boom

AI’s growth story is much bigger than chatbots.

The market was already valued at an estimated $800 billion by late 2025, and continued adoption could push it beyond $1 trillion in the years ahead. That growth will require more data centers, computing power, software, networking and intelligent devices.

But the most obvious AI names may not be the only companies positioned to benefit.

MarketBeat’s free 10 Best AI Stocks to Own in 2026 report identifies ten publicly traded companies helping power the next phase of the AI buildout. Some are established leaders. Others occupy less obvious corners of the expanding AI ecosystem.

This free report names 10 stocks positioned to ride that wave before the rest of the market catches on.

Stock Spotlight (pre-market)

Constellation Energy $CEG ( ▲ 3.93% )
 
higher premarket after Google parent Alphabet signed a 20 year deal to buy more power from 11 of its nuclear reactors. Constellation will spend more than $4.3 billion upgrading the plants, the largest deal yet to boost existing reactors.

Option Care Health $OPCH ( ▲ 3.22% )  

sharply higher premarket on a Financial Times takeover report. McKesson and buyout firm Clayton Dubilier & Rice are in advanced talks to buy the infusion services company for about $5 billion.

Lamb Weston $LW ( ▲ 2.23% )  

beat first quarter estimates before the bell and raised its full-year outlook. The french fry maker earned 75 cents a share before one-time items, versus about 58 cents expected, on higher North American volume.

Advanced Micro Devices $AMD ( ▼ 0.34% )  

higher premarket after Citi raised its price target to $800 from $575. Citi expects AI agents like Meta's Muse to drive demand for server processors, where AMD is the biggest supplier to cloud companies. CEO Lisa Su also said AMD plans to substantially increase chip supply in 2027.

Lennar $LEN ( ▼ 6.73% )  

higher premarket after Berkshire Hathaway disclosed in a regulatory filing that it bought about 2.4 million shares of the homebuilder. Berkshire's own stock is little changed.

Skydance $SKYD ( 0.0% )  

starts trading on the New York Stock Exchange today, replacing PSKY, as Paramount closes its $110 billion takeover of Warner Bros. Discovery. The combined company owns CBS, CNN, HBO Max, Paramount+ and both the Paramount and Warner Bros. film studios.

What to Watch

Fed Speakers (Today)
New York Fed President John Williams, Dallas Fed President Lorie Logan and Fed Governor Michelle Bowman all speak today. Traders mostly expect a hold on October 28, so any hint of an October hike would undo this morning's bond relief.

Want to Know about this years upcoming IPO’s?
MarketBeat did an excellent job on this free IPO guide on IPO’s happening this year

Tanker Attacks in Hormuz
More crude is getting out only because U.S. forces are escorting tankers, and Iran attacked nearly 20 ships in the past month. If those attacks slow the flow, Brent likely heads back over $100.

Today’s Sponsor

How Jennifer Aniston’s LolaVie brand grew sales 40% with CTV ads

The DTC beauty category is crowded. To break through, Jennifer Aniston’s brand LolaVie, worked with Roku Ads Manager to easily set up, test, and optimize CTV ad creatives. The campaign helped drive a big lift in sales and customer growth, helping LolaVie break through in the crowded beauty category.

Learn more