September 25th Pre-Market Brief

Good Morning

It's been a split week. Nasdaq is headed for a gain while the Dow is on track for its fourth straight losing week, investors are still leaning on tech to carry.

Last night's state dinner for Xi had Jensen Huang, Tim Cook, Elon Musk and Lisa Su seated with both presidents, that table was basically all chip talk.

Let's dig in...

Today's Big Picture

1. Iran's "New" Offer
Iran says Hormuz can reopen in seven days if the U.S. accepts the terms of June's failed ceasefire. The White House has already said no to those terms, and Gulf allies want it to keep up the pressure. Oil fell anyway, so traders are pricing in more progress than the terms support.

2. AI Is Keeping Stocks Calm And Pushing Rates Up
Stock market swings are near their calmest of the year, while bond market swings just hit their highest since March. Investors are betting AI profits can outrun higher rates. But AI is also part of why rates are rising. Companies borrowing to build data centers are competing with government bonds for investors' cash.

3. U.S. Companies Already Bet On A Quiet Summit
U.S. companies ordered more from Chinese suppliers in September, a bet on calm, according to research firm China Beige Book. Eurasia Group now puts the odds of stable U.S.-China ties at their highest since Trump returned to office. That calm rests on a trade truce that expires Jan. 10.

Market Overview

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Stock Spotlight (pre-market)

Akamai Technologies $AKAM ( ▼ 6.78% )  

sharply higher after landing an $11.6 billion, seven-year deal to supply cloud computing to Anthropic. The contract is worth about two-thirds of Akamai's entire market value at Thursday's close. Anthropic also gets the right to buy a small stake at $111.33 a share.

Costco $COST ( ▼ 0.91% )  

slightly lower even though profit and sales beat estimates. The beat leaned on a one-time tariff refund worth 15 cents a share, and membership fee income came in just under forecasts.

Scholastic $SCHL ( ▼ 7.38% )  

sharply lower after its fiscal first-quarter loss widened. The children's book publisher lost $3.63 a share on an adjusted basis, versus $2.52 a year ago, and revenue fell from last year.

Nike $NKE ( ▼ 1.72% )  

lower after Bank of America downgraded it to underperform, the bank's version of a sell rating, and cut its price target to $30 from $47. BofA says the turnaround is taking longer and expects sales to decline through fiscal 2027, with earnings due Oct. 1.

Synopsys $SNPS ( ▲ 2.87% )  

higher after HSBC upgraded the chip design software maker to buy from hold. HSBC says a new business model will make it a high growth AI beneficiary.

People Inc. $PPLI ( ▲ 8.16% )  

higher after The Wall Street Journal reported MGM Resorts $MGM ( ▼ 10.99% ) is discussing a bid for Barry Diller's company. One day earlier, People withdrew its $48.30 a share cash offer for MGM.

What to Watch

Iran's Answer (This Weekend)
Iran's foreign minister is staying in the U.S. through the weekend to wait for a reply. The White House says it is "not in a rush." A yes would likely pull oil and yields lower by Monday. Silence, or another Houthi strike on Saudi Arabia like this morning's, would push them back up.

U.S.-China Trade Details (Monday)
Trade Representative Jamieson Greer says "a lot more details" on the China talks come Monday. The first thing to check is farm purchases, where China is behind on about $17 billion in promises. Firm numbers would support grain prices, which slipped overnight on the lack of detail.

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

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