Morning Briefing
Published
S&P 500 futures point to a firmer open, up 0.4%, as crude oil pulls back sharply overnight and eases some of the inflation anxiety that hammered stocks and Treasuries on Thursday. Brent and WTI proxies are down more than 2% in early trading, natural gas is off 3.4%, and the VIX has fallen nearly 4%, all consistent with markets pricing a diplomatic off-ramp in the Strait of Hormuz standoff even though the underlying military posture, deployed navies, air defenses, and mobilizing troops, remains unchanged. Iran's foreign minister says Tehran has floated a new proposal to reopen the strait, giving Washington seven days after acceptance to meet unspecified conditions, while President Pezeshkian insists Iran has not closed the strait and wants to revive its ceasefire framework with the US before the November midterms.
The relief comes after Thursday's session, when the S&P 500 slipped as the 10-year Treasury yield hit 5.17%, its highest since July 2007, and the 30-year touched levels last seen in 2004. Fed Chair Powell said September's inflation data drove the central bank's recent rate hike and signaled another increase may be needed, comments echoed by Fed officials Paulson and Williams, who both flagged energy costs and the AI buildout as inflation risks. Overnight, Bank of England Governor Bailey warned that persistently high energy prices make it harder to hold a no-hike stance, and Fed's Williams reiterated the central bank can't ignore ongoing supply shocks even though the labor market itself isn't adding to inflation pressure. The Senate separately rejected a war-powers resolution on Iran by a 49-50 vote, with four Republicans crossing party lines.
Technology is leading pre-market sector moves, with chip and hardware names extending Thursday's AI-infrastructure enthusiasm, while energy names broadly lag as crude retreats.
Company News
- Akamai Technologies is up sharply pre-market after unveiling an $11.6 billion multi-year cloud agreement with Anthropic that could expand toward $20 billion in total commitments, alongside separate hardware deals with Jabil and Lenovo.
- Costco Wholesale reported fiscal fourth-quarter earnings of $6.60 a share excluding tariff benefits, missing expectations, on revenue of $95.72 billion versus $96.76 billion expected; the company also disclosed $184 million in IEEPA tariff refunds for the quarter.
- Blue Origin raised $10 billion at a $140 billion valuation in its first outside funding round, with Jeff Bezos contributing $2 billion.
- GoDaddy is in early-stage talks to be acquired by Gen Digital, according to the Financial Times.
- BASF has made a takeover approach for chemicals rival Evonik, according to the Financial Times.
- Corteva's seed and genetics spinoff Vylor has had its Form 10 registration declared effective by the SEC, with the share distribution expected before October 1 and trading on the NYSE under VYLR set to begin that day.
Overseas Data
Germany's October GfK consumer confidence fell to -30.6, worse than the -27.2 expected, while Spain's second-quarter GDP growth slipped to 2.6% year-over-year against a 2.7% consensus. Sweden's producer prices rose 0.9% month-over-month and 6.8% year-over-year, both accelerating from prior readings.
Japan's Nikkei rose 0.5% overnight led by bank stocks. Japan's finance minister said Trump raised concerns about yen weakness, and the dollar has since extended its fall against the yen, down about 0.76%.