Ten Stories Moving the Market

Ten Stories Moving the Market:

Nscale, the AI cloud computing firm, is in talks to sell computing power to Anthropic PBC in a deal that could be worth about $45 billion; the Nvidia-backed data center developer is seeking a second major deal with the firm behind Claude for a facility at its Monarch data center campus in West Virginia – Bloomberg. (Why you should care - another multibillion-dollar compute deal suggests AI infrastructure demand is holding up despite last week’s selloff, a positive read-through for neoclouds, Nvidia, and the power and data center supply chain)

White House envoys Steve Witkoff and Jared Kushner are expected to travel to Norway this week for the latest round of talks with Volodymyr Zelenskyy seeking to end the war in Ukraine; the Ukrainian president also referred to a potential meeting with Witkoff and Kushner “in the coming days” in Norway while speaking over video call to US members of Congress – FT. (Why you should care – a deal between the Ukraine and Russia could lift global sanctions, boosting supplies of metals and energy goods)

U.S. President Donald Trump said he would be willing to meet with Russian President Vladimir Putin and Chinese President Xi Jinping to focus on denuclearization efforts rather than ending the war in Ukraine; Trump suggested holding the talks in China – Bloomberg. (Why you should care – trilateral denuclearization talks, and a possible agreement, could reduce the geopolitical risk overhanging global stock and bond markets)

Chancellor Friedrich Merz appealed to Germany's businesses to ‌embrace artificial intelligence at an industry summit in Berlin that was meant to attract investment, including an expected deal with US chip maker Nvidia; speaking alongside Nvidia CEO Jensen Huang, Merz stressed the importance of AI in efforts ​to revive Germany's economy and modernize its industry – Reuters. (Why you should care – Europe is increasingly falling behind the U.S. and China in the artificial intelligence race, putting its economy at a disadvantage)

The White House is authorizing the sale of sanctioned oil tankers in an effort to allow the vessels to start legitimately shipping crude, according to U.S. Energy Secretary Chris Wright; the U.S. government is working with investors who buy idled sanctioned tankers, refurbish them and use the ships to transport non-sanctioned oil, Wright said at a Citadel Securities event – Bloomberg. (Why you should care – the White House is pulling every lever it can to boost global oil supply and lower prices)

The artificial intelligence boom, increasingly acknowledged at the Federal Reserve as helping drive inflation, has left central bankers faced with cooling the rest of the economy to lower price pressures amplified by an industry of marquee names like Amazon, ​Apple, and Anthropic considered immune to rate hikes – Reuters. (Why you should care – higher interest rates could do additional damage to a steadily eroding housing marketing, potentially hurting non-technology focused economic growth)

Homebuyers are backing out of contracts at near-record rates, a potential sign of how higher mortgage rates are prompting buyers to rethink their plans; nationwide, 14.5% of homes fell out of contract in September, according to Redfin data, the highest share on record apart from the early months of the COVID-19 pandemic – Yahoo Finance. (Why you should care – a sustained drop in interest rates could spur a rebound in the housing market)

China kept its benchmark lending rates unchanged for the 17th straight month in October, in line with market expectations; China's central ​bank is considering switching its main policy rate to the overnight reverse repurchase rate, in ​a shift aimed at improving the transmission of monetary policy to support the economy – Reuters. (Why you should care – the lack of change implies the government in Beijing isn’t interested in introducing monetary stimulus at the moment)

For people across China, economic worries are mounting; a multiyear real-estate slump has no end in sight, steady jobs are becoming rarer, especially for young people, and many people seem to be hoarding their money in preparation for worse times ahead – WSJ. (Why you should care – China’s manufacturing industry is becoming increasingly reliant on robotic-driven production)

China imported 360,878 metric tons of U.S. soybeans in September, up from zero a ​year earlier, as soybeans bought under ‌a deal to end last year's trade war continued to arrive at Chinese ports – Reuters. (Why you should care – China is increasingly seeing pressure from other trading partners over dumping goods in foreign ports that hurts local competition)

Economic Calendar:

Earnings: GE, NFLX, RTX, ISRG, CB, COF, MMM, NOC, GM, MSCI, UAL, HAL, SYF, KEY, EFX, GPC, HAS

U.K. - Employment Report for August (2 a.m.)

Germany - PPI for September (2 a.m.)

Germany - ZEW Economic Sentiment for October (5 a.m.)

U.S. - Housing Starts and Building Permits for September (8:30 a.m.)

U.S. - Pending Home Sales for September (10 a.m.)

Treasury Auctions $95 Billion in 6-Week Bills (11:30 a.m.)

U.S. - American Petroleum Institute Crude Oil Inventory Data (4:30 p.m.)

Japan - Trade Balance for September (7:50 p.m.)