MARKET WRAPS
STOCKS: Stocks slid and the Nasdaq completed its largest weekly loss since June amid fears about credit costs derailing the artificial-intelligence boom.
TREASURYS: Long-term Treasury yields rose as oil prices surged again.
FOREX: The U.S. dollar fell against rivals as the upward trend in place for much of the year reversed itself this week.
COMMODITIES: Oil futures closed above the psychologically significant $100-per-barrel level in New York after the biggest weekly gain since July.
HEADLINES
Warsh Avoids Signal on October Rate Move
Federal Reserve Chairman Kevin Warsh declined to endorse or push back
on colleagues' recent signals that officials are in no rush to raise
interest rates this month, saying the central bank was no longer in the
business of previewing its decisions.
"I don't prejudge meetings. I don't believe in saying now what I might
do at the meetings we have in the balance of this year," Warsh said.
"It's a new chapter at the Fed, and we're not in that business anymore."
Warsh made the comments Friday morning local time in Bangkok in a
moderated conversation at the meetings of the International Monetary Fund
and shortly before Fed officials were set to enter their quiet period
ahead of the Oct. 27-28 meeting. He spoke with IMF Managing Director
Kristalina Georgieva.
U.S. Import Prices Rose in September
U.S. import prices rose in September for the second consecutive month,
the Bureau of Labor Statistics said Friday.
Overall import prices rose 1.1% in September, after expanding by 0.5%
in August, the BLS said. Economists polled by The Wall Street Journal had
forecast a 0.8% increase. Year-on-year import prices were up 8.1%, the
BLS said.
Import prices exclude duties, such as tariffs imposed on imports by
the Trump administration, as well as transportation costs.
From Verizon to UnitedHealth, Corporate America Is Balking at 'Tokenized'
Stocks
The country's top securities regulator made a push last month to bring
tokenized stock trading to the U.S. Now, corporate America is pushing
back.
AI chip maker Broadcom, telecom stalwart Verizon Communications and
UnitedHealth are among the companies objecting to the Securities and
Exchange Commission's plan for tokenizing their stocks, according to a
regulatory filing.
Many exchanges and trading venues are eager to offer digital tokens
that represent traditional shares and can trade 24/7. The goal is to
appeal to a class of new-age investors who have grown up on crypto and
want to trade round-the-clock. But some companies worry the SEC's plan
for tokenization might create a shadow stock market, distort trading and
confuse investors.
Travelers Profit Ticks Up on Investment Gains
Travelers reported higher quarterly profit, despite roughly flat
revenue, helped by investment gains.
The insurance company on Friday posted a third-quarter profit of $1.92
billion, or $9.04 a share, compared with $1.89 billion, or $8.24 a share,
a year earlier.
Core earnings per share were $9.18, compared with analyst estimates of
$7.39, according to FactSet.
Regions Financial Posts Higher Profit, Revenue
Regions Financial posted higher profit and revenue in the third
quarter, as both net interest income and non-interest income grew.
The Regions Bank parent posted a profit of $611 million, or 71 cents a
share, compared with $539 million, or 62 cents a share, in the same
quarter a year earlier.
Stripping out one-time items, earnings came in at 73 cents a share.
Analysts polled by FactSet had expected adjusted earnings of 66 cents a
share.
The U.S. budget deficit just hit almost $2 trillion - and Washington
isn't doing much about it
The U.S. federal government's annual budget deficit reached almost $2
trillion for the fiscal year that ended Sept. 30, the Treasury Department
said Friday.
The deficit figure of $1.992 trillion is the largest since 2021 and
amounts to an estimated 6.2% of U.S. gross domestic product, according to
Treasury officials.
It represents a fresh sign of Washington's tendency to spend much more
than it takes in even when the U.S. economy isn't in a recession, and
comes just a couple of months after a bout of hand-wringing over the
government's total debt surpassing $40 trillion.
Cleveland-Cliffs Braces for Fight as Canada Looks to Block Layoffs at
Stelco
OTTAWA-Cleveland-Cliffs is digging in on planned lay offs at its
Stelco operations in Canada as Prime Minister Mark Carney's government
weighs legal options, including fines and potentially forced sale of
assets, to protect workers.
Calls for Ottawa to take action have grown in recent days after Stelco
began handing out layoff notices. Industry Minister Melanie Joly had
earlier requested that the steel company produce a plan to comply with
promises on jobs she said were agreed to when Cliffs bought Stelco in
2024 for about $2.5 billion.
Cliffs Chief Executive Lourenco Goncalves said the company hasn't
breached the law and that a temporary reduction in headcount is needed as
it refocuses its operations to counter the pressure on the industry from
tariffs. The company, which is set to report quarterly results on Monday,
said it could lay off as many as 500 workers as it idles cold-rolled and
coated steel operations in Hamilton, Ontario, and concentrates on
hot-roll products.
Tesla's New Roadster Takes Flight After Nearly a Decade of Delays
After nine years, potentially millions of dollars in deposits and
considerable hype, the Tesla Roadster is finally ready to launch-which it
did.
The electric automaker on Thursday unveiled its second-generation
sports car with a flourish of engineering prowess. Using SpaceX rocket
technology, the angular sports car climbed a curved ramp and hurled
itself to a controlled landing. Later, it leapt over five other Tesla
vehicles while twisting in the air.
The demonstration was held before a crowd of Tesla enthusiasts-some of
whom paid $250,000 to reserve the car nine years ago-at a SpaceX rocket
test site facility in McGregor, Texas.
Tesla's Energy Boss Leaves the Company
Tesla's top energy boss has left the company.
Mike Snyder, vice president of energy and charging, stepped down from
his role, according to people familiar with the move.
Snyder joined Tesla in 2014 and worked his way up to lead the
company's Megapack industrial battery division, according to his LinkedIn
page. He was promoted to vice president in 2024 following a companywide
restructuring and layoffs that saw the departure of several of Tesla's
top executives, including longtime energy chief Drew Baglino.
TALKING POINT Michael Dell, a Dot-Com Era Survivor, Has Tips to Beat an AI Bust
Spooked investors are fleeing some of the big-tech companies that reached new highs on the back of the artificial-intelligence boom.
But Michael Dell says his company is well-placed to weather a storm. The direct-to-consumer PC company he founded in a dorm room in 1984 with $1,000 has pivoted to delivering the powerful supercomputers that tech giants can't get enough of. And its strategy for selling them makes it relatively unique among the businesses benefiting most from the world's unprecedented AI infrastructure build-out.
Dell relies on just-in-time manufacturing of its AI servers and PCs, which has allowed it, in essence, to get its customers to finance its operations and inventory. Meanwhile, hyperscalers like Amazon.com and Google and the builders of their AI data centers-the so-called neoclouds like CoreWeave, Nebius and Crusoe-are piling on debt to fund the build-out of their AI hubs.
Dell Technologies' valuation is almost four times what it was a year ago, boosted by a projected 70% increase in revenue for its current fiscal year.
When I asked Dell on Tuesday about how he was preparing his company for a possible downturn in the AI cycle, he said, "There are some new challenges that this presents, but if you look at our cash conversion cycle, it's still negative."
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