Good morning,
 
The defending champion NY Knicks lost their season opener last night. It never feels good to lose, especially against any team from Philly, but last night was really all about raising the banner to the top of MSG. Seeing the enormous 22-carat, 800 diamond championship rings, with a twist-off replica of the Garden- wasn’t bad either, and the gold-accented unis were fire too. Before all the fanfare, the S&P rose 0.3% yesterday, with the other major indexes outperforming: equal-weight +1.1%, Russell +1.7%. Healthcare, Real Estate, Utilities and Financial sectors were all up 1%, and 9/11 were higher overall. Tech was mixed, however, though CoreWeave- a major source of concern for AI- rallied off its lows to finish in the green. The treasury curve flattened with 2y unchanged and 10/30y down 3-5bp.
 
Equity futures are up this morning and near their highs, having traded in a relatively tight range overnight. SpaceX reported very bullish AI demand and Super Micro pre-announced revenue well-above consensus, driving those stocks up ~10% in the pre-market and boosting sentiment for the space (pun intended). There was a lot of NVDA news flow around new partnerships and the stock is up over 1% in the pre-market. The WSJ reported that in Anthropic’s latest draft S-1, the company generated ~$16B in revenue and lost $80B in 1H26 and could spend up to $750B on compute capacity in the coming years. Nvidia is looking into investing in Australian data center Firmus, whose delayed IPO contributed to the AI selloff recently. Meanwhile, Australian peer NextDC cut its guidance on power delays (stock down 31%) while DayOne could delay its IPO in the US. This all sets up META’s earnings after the close today. Among the other earnings reports, NFLX, ISRG, T, ABT, DHR, MCO and TMO are trading down 3-8% in the pre-market, while COF is up 4%. EQT reportedly made an offer to take QGEN private at $50/share, and KKR also made a bid, while MSFT’s Xbox division is drawing interest from PE as well.
 

 
Treasury yields are flat to down 2bp at the long end and at their lows of the day, while the US Dollar Index is around unchanged.                 
 

• US 2yr -2bps to 4.77%, 5yr -2bps to 4.91%, 10yr -2bps to 5.09%, 30yr -2bps to 5.40%
• USD index: -$0.02 to $101.51

Europe has moved to its highs. Tech, Energy and Real Estate are leading. UK inflation rose though core was about inline, setting up another potential BOE hike in November. The EU and Canada will reportedly announce an historical alliance next week, including Canada becoming an associate member of the bloc. Indonesia maintained its repo and lending facility rates unchanged but raised the deposit facility 25bp to attract capital inflow. Japan’s Nikkei rose 0.9%, led by metals and financials, with tech names boosted by after-market reports from SPCX and SMCI. That also to solid gains in South Korea and Taiwan. Activist investor Align Partners has taken a 1.5% stake in SK Hynix’s parent company, SK Inc (034730, +12%). Chinese markets were an outlier to the downside. Tech majors were weak (Tencent -4%) and battery maker CATL fell 11% on earnings.  
 

 
Crude has turned lower after trading up for most of the morning. Persian Gulf oil exports have exceeded pre-war levels despite the ongoing hostilities, according to the WSJ, citing data from Kpler. Yesterday API reported crude inventories fell almost 5M barrels, more than expected. The DOE’s data is later this morning. The December contract has approached $112 but hasn’t seen that level stick, yet. Engagement between US, Russian and Ukrainian sides seem to be moving forward. US envoy Witkoff is in Russia today for talks with Putin, after “constructive” talks between the US and Zelensky yesterday. US natural gas is lower again, looking to make it four declines in a row on warm weather forecasts. European gas is higher. Precious metals are mostly lower but gold is seeing a slight gain as $4100 continues to be a floor for the metal. Bitcoin and Ether are up, with Bitcoin looking to move above its 20d ma ~$83K. Ag commodities are mostly lower with Russia/Ukraine talks ongoing.
 

 
Earnings:
After-Market: ADC, ALK, CB, COF, EWBC, HWC, ISRG, LRN, NFLX, NLY, OZK, PEGA, SPCX, UAL, WFRD
Pre-Market: ABT, BKU, CME, DHR, ELV, IART, LAD, MCO, MHO, NEE, NTRS, ONB, PM, SF, T, TMO, UNF, WAB, WGO
After-Market: BANR, BBT, CACI, CCI, CSX, EGP, FAF, FULT, GGG, GL, GTY, HXL, IBM, KALU, KNX, LBRT, LUV, LVS, LRCX, MEDP, META, MOH, OII, PKG, PNFP, ROL, RS, SAP, SLG, SON, TCBI, TSLA, TXN, URI, WDFC, WH
 
Economic Data:
 
US:

• Mortgage applications: -7.3% vs prior -4.0%
  • Refis: -2.0% vs prior -0.4%
  • 30y rate: 7.41% vs prior 7.5%
• 10:30am EIA crude inventories
• API inventories (AMC yesterday): -4.93M vs -1.3M cons, prior -11.12M
• 1:00pm 20y auction
•  

Global:

• Indonesia rate decision: Repo, lending rate unchanged; deposit rate increased 25bp
• Japan Exports / Imports y.y: 16.7% / 18.9% vs 20.1% / 19.6% cons, prior 19.3% / 28.0%
• UK CPI: m.m / y.y: 0.4% / 3.5% vs 0.3% / 3.4% cons, prior 0.5% / 3.1%
  • Core: 0.2% / 2.8% vs 0.2% / 2.7% cons, prior 0.3% / 2.6%