Good morning,
 
Last week was the first full trading week in Q4. Major indices were mixed yet again, kind of like the emotions of a Giants fan after yesterday’s tie. However, that is clearly better than that of an Eagles fan. The &P 500 closed up just over 1% hitting a new all-time high while breadth finally began to improve, though the tech trade wobbled. The equal-weight version of the index closed up 1.6% breaking a seven-week losing streak. However, interest rate sensitive small caps fell with the Russell 2k closing down ~1%, its fifth consecutive weekly decline. Within tech the hyperscalers and software outperformed while memory, chip stocks and neoclouds were under pressure.
 
It is pretty quiet with the holiday and credit markets closed. Oil prices were pulling back overnight helping US futures but as that has reversed futures have also pulled back to around unchanged. Oil prices moved modestly lower late in the session on Friday after President Trump announced the Russia diesel deal though there is a lot of skepticism around their ability to deliver. Over the weekend President Trump proclaimed there would be an energy ceasefire between Ukraine and Russia, however, the two sides must have missed the email. In addition, there were more strikes on airports in Saudi Arabia with President Trump suggesting the US could get more directly involved. ICE Brent has reversed overnight losses now up ~2% breaking above last week’s high ~$106.
 

 
There is no economic data today ahead of inflation data and retail sales on Wednesday and Thursday. There is a Bloomberg story suggesting that the Treasury could cut issuance of 20/30yr bonds next month. Major financials begin reporting tomorrow. Broadcom’s CEO is highlighting that capital is becoming AI’s biggest bottleneck. The FT reported that according to Morgan Stanley data, AI related debt issuance fell to $23B in September less than half the prior month and down from >$100B at the peak in June. This is not stopping companies from looking at M&A transactions. Nvidia, who is clearly not capital constrained, is reportedly considering a purchase of Reflection AI, an open-source model company founded by former Google DeepMind researchers for >$25B. Amazon is reportedly looking at Decart a hardware optimization software company valued ~$7B. In the quantum world, IonQ, announced it would buy Elisity in an all-stock transaction valued up to $1.3B. Memory stocks were under pressure overnight in South Korea and this morning in the pre-market as investors worry that China’s CXMT is becoming a viable competitor. Chips are also modestly lower in the premarket while software has a bid. Salesforce is up ~4% after a Bank of America upgrade. Anthropic has an investor event scheduled for Wednesday.  
 
Markets in Asia were mostly lower overnight. Japan was closed for holiday. South Korea fell nearly 4% with memory stocks down on the aforementioned CXMT news. European indices are extending Friday’s bounce up between 0.5% - 1% with financials outperforming. Autos are modestly higher after the EU and China agreed on a hybrid vehicle export cap which is weighing on lithium miners (SQM/ALB -4%). Luxury stocks are modestly higher ahead of LVMH after the European close. Yields are modestly higher in Europe with peripheral spreads continuing to blow out on fiscal concerns.
 

 
Oil prices continue to move higher throughout the morning. US nat gas is down ~3% but higher in Europe. Precious metals have reversed overnight gains with gold and silver now down ~0.5%.  Ag is mixed. Crypto moved higher over the weekend but is off the best levels. The bounce is reversing some of last week’s losses which seemed to be related to concerns that AI could crack cryptography.
 

 
Economic Data:
US:

• 12:50 Fed Hammack

Global:

• India Inflation: 0.7%/5.5% m.m/y.y vs. 5.4% cons., prior 0.7%/4.8%