STRAIGHT FROM THE TRADING FLOOR
by Eric Criscuolo - Market Strategist
Published on 10/14/26 (a/o 2:30 pm)
DOW 51,453 (-217), S&P 500 7,705 (-101), Russell 2000 2,723 (-60), NYSE FANG+ 19,115 (-454), ICE Brent Crude $106.10/barrel (+$0.41), Gold $4,117/oz (-$60), Bitcoin ~81.6k (-1894)
- CPI: "That's Hot"
- Big swings in yields
- Tech under pressure
- New US Government investment
- Check out some of the recent ICE Data/Content:
- Inside the ICE House
- Episode 561: Circle CCO Kash Razzaghi on Arc, AI Agents and the Race to Make Money Instant
- ETF Central: Melanin Money and Capitalwize Founder George Acheampong
- NYSE Research Insights: Behind the Record Volumes: A Hidden Opportunity
- ICE Mortgage Monitor: ARM Demand Hits Nearly Four-Year High on Rising Mortgage Rates
- Market Storylines
MAC Desk Commentary:
Yesterday was a choppy session with most major indices ending on either side of unchanged. Another earnings season kicked off with bank and healthcare earnings generally looking pretty solid, but with the stocks mostly lower. Memory and chip names were under pressure again amidst CXMT competition and demand concerns as AI-related debt got hit. The Russell 2k fell 0.4% as investors moved up the quality scale. Oil prices continued to hover around recent highs. Yields pulled back modestly with the front end dropping in the afternoon after NY Fed Williams said that he sees one additional hike this year but doesn’t currently see the need for additional tightening next year. Hmm…
Equity futures were modestly higher ahead of this morning’s CPI inflation data. Headline was inline with expectations, up 0.6% m.m while the annual reading accelerated to 3.7% from 3.4%. As widely expected, energy drove much of the move higher with the increase in gasoline accounting for >50% of the total increase. Interestingly, food away from home was up 0.2% while food at home fell 0.1% (not based on my grocery bill).
The problem was core, which came in a tenth ahead of estimates, up 0.3% versus last month and 2.6% on an annual basis. As Paris Hilton would say, “That’s Hot”.
Shelter ticked up to 0.4% while used cars, apparel, transportation and medical care services all accelerated. Over 50% of components are tracking >3%, a metric Fed Chair Warsh has called out.
The 2y jumped about 17bp from its level just prior to the release. 10 and 30y were up over 10bp. The S&P opened down 0.4%, eventually falling 1.4% with the index testing support at the 50d ma ~7705. Treasuries have staged a big rally since the open and yields have fallen back but the pressure on equities hasn’t let up.
The equal-weight is faring slightly better, while small and mid caps lag despite yields coming all the way back.
Tech is getting smashed. DRAM -4% (-12& WTD), NYSE Semis -4%, IGV software ETF -3%. The mega-cap tech names are down 1-3% except for Apple which is slightly higher. The NYSE 100 is down 2%. Downgrades (DELL, HPE) are also hitting the sector. Anthropic is hosting an investor day today, though we haven’t seen any headlines from it. Quite the timing given today’s sell off (and general AI weakness overall). Security remains a key AI risk but this time it wasn’t a rouge software agent. An OpenAI employee was arrested for planting a recording device in a conference room.
Data centers and neoclouds are seeing losses of over 10% in many stocks, with the earlier rates move piling on to growing credit concerns. Quantum computing stocks are also seeing losses of around 10% across the group and space names are nowhere near the launch pad. Consumer Discretionary is getting hit as homebuilders fall ~2% while travel/cruise/airlines fall 2-5%.
Healthcare (broadly higher outside of Med Tech), Consumer Staples (broadly higher) and Energy (crude higher) are solidly in the green.
Pivoting to earnings, ASML is down 2%. The overall tech weakness is not helping. The stock tried to rally from pre-market lows as the open but faded throughout the day. Results were strong and management highlighted customers were placing orders out to 2030, and the company was exploring increasing capacity above prior guidance of a 30% by 2028.
Morgan Stanley (-3%) and Bank of America (-6%) earnings largely had the same themes peers reported yesterday. A $1.2B fine from Treasury on AML violations is weighing on BAC. State Street (-6%) is under pressure after its results. BlackRock (flat) is off its highs but holding up. AUM hit reported which is the positive standout this morning.
The US government is making another investment in a public company, this time GlobalFoundries (+4%). President Trump announced a $21B investment deal with Japan, with GlobalFoundries operating 2 semiconductor manufacturing facilities in NY and the Dept of Commerce receiving ~4% equity in the company.
Treasury yields have erased all of the initial post-CPI jump and are now lower on the day, with 10/30y down 3-4bp. Market pricing for a rate hike in October have moved up from 22% yesterday to 35% today. The US Dollar Index remains higher but off its lows as yields fell back.
- US 2yr -1bps to 4.80%, 5yr -2bps to 4.99%, 10yr -3bps to 5.19%, 30yr -4bps to 5.52%
- USD index: +$0.36 to $102.34
Treasury announced it will buyback up to $6B of 10-20y bonds at the repurchase operation tomorrow, in line with prior operations (which have routinely seen Treasury buy less than the maximum). The Beige Book came out this afternoon with no significant market reaction to it. Three Fed districts reporting no significant change in growth (was two districts last month), while the remaining 9 reported slight to moderate growth (10 previously).
European indices fell on the initial reaction to the CPI data but bounced and ended higher across the region. Healthcare and Consumer Staples led, while basic resources, media and autos lagged.
Markets in Asia were mostly lower overnight. In China Shanghai fell ~1% while Hong Kong was slightly lower despite strong trade data. Imports and exports accelerated meaningfully from last month. CPI was a touch light, but PPI increased more than expected up 5% y.y from 3.8% last month. Japan ended around unchanged. Tech was mixed, financials were under pressure while other areas of the market were mostly higher. South Korea also ended modestly lower. Financials led to the downside while memory stocks continued to be under some pressure.
ICE Brent is modestly higher and Nat gas is down ~2% in the US. Precious metals dropped on the CPI print and haven't recovered on the yield reversal. Ag is mixed. Crypto was holding around unchanged overnight but moved lower post-data.
Besides earnings tomorrow, PPI, weekly claims, Empire and Philly Manufacturing indexes and Retail Sales will be on the calendar.
Earnings:
- After-Market (Wed): EQBK, HOMB
- Pre-Market (Thrs): BNY, CMC, FHN, MAN, MRSH, PLD, PNC, SCHW, USB
- After-Market (Thrs): AA, CNS, IBKR, JBHT
Economic Data:
US:
- Mortgage apps w.w: -4.0% vs prior -2.1%
- Refis: -0.4% vs prior 7.5%
- 30yr Rate: 7.50% vs prior 7.49%
- CPI m.m / y.y: 0.6% / 3.7% vs. 0.6% / 3.6% cons, prior 0.4% / 3.4%
- CPI Core: 0.3% / 2.6% vs. 0.2% / 2.5% cons, prior 0.3% / 2.4%
- 4:30 API Oil Inventories
Global:
- China CPI m.m / y.y: 0.2% / 0.9% vs 0.3% / 1% cons, prior 0.4% / 0.8%
- China PPI: 5.0% vs. 4.5% cons, prior 3.8%
- China Imports / Exports y.y: 31.0% / 36.3% vs 24.5% / 25.5% cons, prior 28.2% / 25.0%
- Germany Wholesale Prices m.m: 1.9% vs 0.7% cons, prior 0.9%
- India Inflation y.y: 11.39% vs 10.18% cons, prior 9.92%
STRAIGHT FROM THE TRADING FLOOR
by Michael P. Reinking, CFA - Sr. Market Strategist
Published on 10/14/26 (a/o 9:00 am)
Happy CPI Day,
Yesterday was a choppy session with most major indices ending on either side of unchanged. Earnings season “officially” got underway with bank and healthcare earnings generally looking pretty solid, but the stocks were mostly lower. Memory and chip names were under pressure amidst CXMT competition and demand concerns as AI-related debt got hit, however, the stocks ended off session lows. The Russell 2k fell 0.4% as investors moved up the quality scale. Oil prices continued to hover around recent highs. Yields pulled back modestly with the front end dropping in the afternoon after NY Fed Williams said that he sees one additional hike this year but doesn’t currently see the need for additional tightening next year.
Futures were modestly higher ahead of this morning’s inflation data. The data came in hot and we’ve since reversed those gains. Headline was inline with expectations up 0.6% m.m while the annual reading accelerated to 3.7% from 3.4%. As widely expected, energy drove much of the move higher with the increase in gasoline accounting for >50% of the total increase. Interestingly food away from home was up 0.2% while food at home fell 0.1% (not my grocery bill). Core came in a tenth ahead of estimates up 0.3% m/m and 2.6% on an annual basis. Shelter ticked up to 0.4% while used cars, apparel, transportation and medical care services all accelerated. Over 50% of components are tracking >3%, a metric Fed Chair Warsh has called out.
Treasury yields were lower by a couple of basis points ahead of the data but have moved sharply higher since hovering just under the recent highs. There is a flattening of the curve with the 2yr up 12bps, 10yr up 9bps and 30yr up 6bps. just under the recent highs. The USD index is hitting new highs up ~0.5% to $102.50. Futures are on the move lower. S&P futures have fallen ~50pts since the release down ~0.3% while Russell futures are now off >1%.
On the corporate headline front. Anthropic will be hosting an investor day today which will get a lot of attention. Security risk is top of mind after an OpenAI, Saudi national employee, was arrested for planting a recording device. There are reports that the company is exploring a cybersecurity acquisition and that it plans to delay the release of new models until safety concerns are addressed. ASML is trading slightly lower after earnings. Results were strong, management highlighted strong demand and that it would likely be capacity constrained through 2029. Morgan Stanley(-3%) and Bank of America (-6%) earnings largely had the same themes as yesterday with weakness in FICC trading, advisory/wealth management were strong. This also helped BlackRock (+2%) which is the positive standout this morning. BAC is getting hit after a $1.2B fine from Treasury for AML violations. State Street (-8%) is also sharply lower after its results disappointed.
Markets in Asia were mostly lower overnight while European indices extend recent gains. China ended modestly lower despite very strong trade data with imports and exports accelerating meaningfully from last month. CPI was a touch light, but PPI increased more than expected up 5% y.y from 3.8% last month. Japan ended around unchanged tech was mixed, financials were under pressure while other areas of the market were mostly higher. South Korea also ended modestly lower. Financials also led to the downside here while memory stocks continued to be under some pressure. European indices are stilling holding on to gains but have pulled back since the US data.
ICE Brent is a touch lower despite continued tensions. WTI rolls tomorrow. Keep in mind inventory data is delayed a day for the holiday. Nat gas is down ~2% in both the US and Europe. Precious metals were lower overnight and have accelerated to the downside as the USD has moved higher. Gold is down ~1.5% retesting last week’s low ~4,100. Silver is down ~4% and has already broken that low currently trading ~$57. Ag is mixed. Crypto was holding around unchanged overnight but has also moved modestly lower post data.
Economic Data:
US:
Yesterday was a choppy session with most major indices ending on either side of unchanged. Earnings season “officially” got underway with bank and healthcare earnings generally looking pretty solid, but the stocks were mostly lower. Memory and chip names were under pressure amidst CXMT competition and demand concerns as AI-related debt got hit, however, the stocks ended off session lows. The Russell 2k fell 0.4% as investors moved up the quality scale. Oil prices continued to hover around recent highs. Yields pulled back modestly with the front end dropping in the afternoon after NY Fed Williams said that he sees one additional hike this year but doesn’t currently see the need for additional tightening next year.
Futures were modestly higher ahead of this morning’s inflation data. The data came in hot and we’ve since reversed those gains. Headline was inline with expectations up 0.6% m.m while the annual reading accelerated to 3.7% from 3.4%. As widely expected, energy drove much of the move higher with the increase in gasoline accounting for >50% of the total increase. Interestingly food away from home was up 0.2% while food at home fell 0.1% (not my grocery bill). Core came in a tenth ahead of estimates up 0.3% m/m and 2.6% on an annual basis. Shelter ticked up to 0.4% while used cars, apparel, transportation and medical care services all accelerated. Over 50% of components are tracking >3%, a metric Fed Chair Warsh has called out.
Treasury yields were lower by a couple of basis points ahead of the data but have moved sharply higher since hovering just under the recent highs. There is a flattening of the curve with the 2yr up 12bps, 10yr up 9bps and 30yr up 6bps. just under the recent highs. The USD index is hitting new highs up ~0.5% to $102.50. Futures are on the move lower. S&P futures have fallen ~50pts since the release down ~0.3% while Russell futures are now off >1%.
- US 2yr +12bps to 4.93%, 5yr +12bps to 5.13%, 10yr +10bps to 5.31%, 30yr +6bps to 5.62%
- USD index: +$0.60 to $102.58
On the corporate headline front. Anthropic will be hosting an investor day today which will get a lot of attention. Security risk is top of mind after an OpenAI, Saudi national employee, was arrested for planting a recording device. There are reports that the company is exploring a cybersecurity acquisition and that it plans to delay the release of new models until safety concerns are addressed. ASML is trading slightly lower after earnings. Results were strong, management highlighted strong demand and that it would likely be capacity constrained through 2029. Morgan Stanley(-3%) and Bank of America (-6%) earnings largely had the same themes as yesterday with weakness in FICC trading, advisory/wealth management were strong. This also helped BlackRock (+2%) which is the positive standout this morning. BAC is getting hit after a $1.2B fine from Treasury for AML violations. State Street (-8%) is also sharply lower after its results disappointed.
Markets in Asia were mostly lower overnight while European indices extend recent gains. China ended modestly lower despite very strong trade data with imports and exports accelerating meaningfully from last month. CPI was a touch light, but PPI increased more than expected up 5% y.y from 3.8% last month. Japan ended around unchanged tech was mixed, financials were under pressure while other areas of the market were mostly higher. South Korea also ended modestly lower. Financials also led to the downside here while memory stocks continued to be under some pressure. European indices are stilling holding on to gains but have pulled back since the US data.
ICE Brent is a touch lower despite continued tensions. WTI rolls tomorrow. Keep in mind inventory data is delayed a day for the holiday. Nat gas is down ~2% in both the US and Europe. Precious metals were lower overnight and have accelerated to the downside as the USD has moved higher. Gold is down ~1.5% retesting last week’s low ~4,100. Silver is down ~4% and has already broken that low currently trading ~$57. Ag is mixed. Crypto was holding around unchanged overnight but has also moved modestly lower post data.
Economic Data:
US:
- Mortgage apps: -2.7% w.w prior -4.2%; 30yr Rate - 7.5% prior 7.49%
- CPI: 0.6%/3.7% m.m/y.y vs. 0.6%/3.6% cons. ,prior 0.4%/3.4%
- CPI Core: 0.3%/2.6% m.m/y.y vs. 0.2%/2.5% cons. ,prior 0.3%/2.4%
- 11:00 Treasury buyback announcement
- 1:30 Fed Barkin
- 2:00 Fed Beige Book
- 3:00 Fed Goolsbee
- 4:30 API Oil Inventories
- China CPI: 0.2%/0.9% m.m/y.y vs. 0.3%/1% cons., prior 0.4%/0.8%
- China PPI: 5% vs. 4.5% cons., prior 3.8%
- China Imports/Exports: 31%/36.3% y/y vs. 24.5%/25.5% cons., prior 28.2%/25%
- Germany Wholesale Prices: 1.9% m.m vs. 0.7% cons., prior 0.9%
- India Inflation: 11.39% y/y vs. 10.18% cons., prior 9.92%
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