September 14th Market Overview

Happy Friday

Two things happened over the weekend that markets had to price in this morning. The heads of Anthropic and OpenAI said the industry should slow down AI development, and Saudi Arabia shut a major oil pipeline after a major drone attack. Stocks opened down hard, then spent the rest of the day climbing back.

P.S. If you haven’t read this report on emerging Nuclear energy stocks, I’d give it a quick look down now.

Let’s dig in...

Today's Big Picture

The AI trade split in two

Dario Amodei (Anthropic/Claude) published an essay Saturday calling for a slower pace on frontier models. Sam Altman (OpenAI) agreed and Elon Musk backed him. Chipmakers, server builders and the industrial companies selling into data centers took the hit. Cybersecurity and software went the other way, because slower AI means the software everyone was writing off just got more runway.

The 10-year touched 5 and buyers showed up

The yield hit 5.011% this morning, its highest since 2007, pushed there by record diesel prices and the Saudi pipeline shutdown. It came right back down near 4.94 once bond buyers stepped in. That round trip is the good news in today's tape. There's still real demand for Treasuries once the price gets cheap enough.

Warsh has the votes, probably

Futures put Wednesday's quarter-point increase near certain. July's meeting went 9-3 for a hold, so four people need to change their minds. Goldman's David Mericle wrote that he sees no strong economic case for hiking, then switched his call to a hike anyway. The decision is priced. The dissent count is not.

Market Overview

Index Performance

Stock Spotlight

Bank of America $BAC ( ▼ 5.81% )  
told a Barclays conference that investment banking fees will land between $1.6 billion and $1.8 billion this quarter, down from about $2 billion a year ago. Brian Moynihan still called trading one of the better third quarters the bank has had and said loans and deposits are growing.

Rum Group $RUM ( ▲ 12.48% )  
signed a six-year, $13.7 billion compute deal with Anthropic, according to The Information. That is a long contract for a company this size.

Baldwin Insurance Group $BWIN ( ▲ 8.18% )  
is going private at $32.50 a share in cash, a $7.7 billion deal. The buyers are Sequence Holdings and Michael Dell's family office.

Oracle $ORCL ( ▼ 4.49% )  
said Larry Ellison scrapped plans to sell up to $7.5 billion of his stake, one day after disclosing them. No reason given.

Big Name Updates

Nvidia $NVDA ( ▼ 2.73% )  
led chips lower and is reportedly restricting internal use of Anthropic's models.

AstraZeneca $AZN ( ▲ 2.2% )  
said its breast cancer pill Etcamah missed on progression-free survival in a late-stage trial. Shares rose in London anyway, with Citi and RBC both calling the damage limited. The bigger readout is the AVANZAR lung trial later this year.

CrowdStrike $CRWD ( ▲ 14.41% )  
led cybersecurity higher. Companies are budgeting for AI-driven attacks whether or not the labs ease off.

Blue Chips
MarketBeat lists “7 Blue-Chip Stocks to Add To Your Forever Portfolio”

Other Notable Company News

GE Vernova $GEV ( ▼ 8.35% )  
was the weakest industrial in the S&P 500. It sells power equipment into data centers, and today the market penciled in fewer of them.

Novo Nordisk $NVO ( ▲ 1.08% )  
is dropping the Nordisk and going by Novo. The rebrand lands while Eli Lilly keeps taking share.

Corning $GLW ( ▼ 14.12% )  
fell after entering a $2 billion equity distribution agreement with Goldman Sachs.

Mara Holdings $MARA ( ▼ 4.34% )  
got a double downgrade from JPMorgan, straight from overweight to underweight.

Today’s Sponsor

NVIDIA's Founder Says Farmers Should Absolutely Use AI

“If I were a farmer, I would absolutely use AI.” 

That’s Jensen Huang, founder and CEO of NVIDIA. 

And he's pointing to one of AI’s biggest untapped opportunities: Farming. It’s an industry facing mounting pressure to produce more with less and it’s still massively under-automated. 

DIT AgTech brings AI, nutrition automation, and real-time data to livestock production, helping ranchers boost productivity and get more from every animal. 

And it’s already proven in one of the world's toughest livestock environments: 

• 500+ units deployed 

• 370,000 head of livestock on the platform 

• Up to 55% higher daily weight gain 

Now expanding into the U.S. and Brazil, DIT AgTech is targeting a 300M+ head cattle market. And the biggest barrier to adoption? Gone. Ranchers get the technology for free when they sign up for a three-year nutrition plan. 

DIT AgTech can scale adoption faster, which means more data and more recurring revenue. 

Invest before this early-stage opportunity gets harder to access.

Invest in DIT AgTech Today

^{𝘐𝘯 𝘮𝘢𝘬𝘪𝘯𝘨 𝘢𝘯 𝘪𝘯𝘷𝘦𝘴𝘵𝘮𝘦𝘯𝘵 𝘥𝘦𝘤𝘪𝘴𝘪𝘰𝘯, 𝘪𝘯𝘷𝘦𝘴𝘵𝘰𝘳𝘴 𝘮𝘶𝘴𝘵 𝘳𝘦𝘭𝘺 𝘰𝘯 𝘵𝘩𝘦𝘪𝘳 𝘰𝘸𝘯 𝘦𝘹𝘢𝘮𝘪𝘯𝘢𝘵𝘪𝘰𝘯 𝘰𝘧 𝘵𝘩𝘦 𝘪𝘴𝘴𝘶𝘦𝘳 𝘢𝘯𝘥 𝘵𝘩𝘦 𝘵𝘦𝘳𝘮𝘴 𝘰𝘧 𝘵𝘩𝘦 𝘰𝘧𝘧𝘦𝘳𝘪𝘯𝘨, 𝘪𝘯𝘤𝘭𝘶𝘥𝘪𝘯𝘨 𝘵𝘩𝘦 𝘮𝘦𝘳𝘪𝘵𝘴 𝘢𝘯𝘥 𝘳𝘪𝘴𝘬𝘴 𝘪𝘯𝘷𝘰𝘭𝘷𝘦𝘥. 𝘋𝘐𝘛 𝘈𝘨𝘛𝘦𝘤𝘩 𝘩𝘢𝘴 𝘧𝘪𝘭𝘦𝘥 𝘢 𝘍𝘰𝘳𝘮 𝘊 𝘸𝘪𝘵𝘩 𝘵𝘩𝘦 𝘚𝘦𝘤𝘶𝘳𝘪𝘵𝘪𝘦𝘴 𝘢𝘯𝘥 𝘌𝘹𝘤𝘩𝘢𝘯𝘨𝘦 𝘊𝘰𝘮𝘮𝘪𝘴𝘴𝘪𝘰𝘯 𝘪𝘯 𝘤𝘰𝘯𝘯𝘦𝘤𝘵𝘪𝘰𝘯 𝘸𝘪𝘵𝘩 𝘪𝘵𝘴 𝘰𝘧𝘧𝘦𝘳𝘪𝘯𝘨, 𝘢 𝘤𝘰𝘱𝘺 𝘰𝘧 𝘸𝘩𝘪𝘤𝘩 𝘮𝘢𝘺 𝘣𝘦 𝘰𝘣𝘵𝘢𝘪𝘯𝘦𝘥 𝘩𝘦𝘳𝘦: https://bit.ly/4bzuWCi​  ​}

Sector Watch

Bond Market

Diesel drove yields today. Retail diesel set a record at $6.23 a gallon and futures near $5.17 point higher. The 30-year sat at 5.38 while the 10-year gave back its morning high.

Policy Watch

Fed

Fed funds sit at 3.50 to 3.75. Warsh needs four of the July holdouts to cross over.

• Logan, Hammack and Kashkari already voted to hike in July.

• Waller said on September 3 he saw little cost in waiting. Williams has said the same.

• Cook said in August she's prepared to act. Barr says he's open to it.

• Jefferson, Powell and Bowman have stayed quiet. They decide this.

JPMorgan's David Kelly expects the fence-sitters to join the majority once it forms, leaving two dissents or fewer. The projections also bring the first look at 2029, though Warsh withheld his own dot in June.

Fiscal & Trade

• The House votes this week on data center costs.

• Treasury buybacks have not slowed long-term yields.

Prices are outrunning paychecks again, with August wage growth the weakest since May 2021. Navy Federal's Heather Long says shoppers are moving to warehouse clubs and discounters at every income level.

International

The Saudi pipeline

Iraqi militants hit the East-West pipeline with drones on Friday, and Saudi Arabia shut it down over the weekend. That line moves 2 to 4 million barrels a day from the Persian Gulf to the Red Sea port of Yanbu, bypassing the Strait of Hormuz. Riyadh has not said when it reopens or how bad the damage is. Rystad puts Saudi inventories at five to seven days of exports, and Reuters sources say a prolonged outage could take about 4% of global supply off the market.

• Iran and the Gulf states postponed their Oman meeting today after the pipeline attack.

• Trump said Russia and Ukraine agreed to stop hitting energy facilities. That would ease the diesel squeeze if it holds.

What to Watch

Wednesday at 2 p.m.

Decision and projections at 2, Warsh at 2:30. He gives no forward guidance, so the dot plot and dissent count carry the message.

Thanks for reading - you are now the more informed 🙂

- John

Today’s Sponsor

Hey! I think this is a great webinar that ALL investors should consider sitting in on. It's fast and efficient, I've sat through twice now Ive learned so much.

You're Invited: Tax-Smart Investing webinar on September 17. Learn the portfolio moves that can help you maximize your after-tax returns — join Range live, and bring your questions for Q&A.

Reserve your free spot