Pre-market market movements
1.
On Thursday, October 15, prior to the U.S. stock market open, the three major U.S. stock index futures showed mixed movements. As of reporting, the Dow Jones futures rose 0.28%, the S&P 500 futures fell 0.27%, and the Nasdaq futures declined 1.24%.
2. As of press time, Germany's DAX index fell 0.46%, the UK's FTSE 100 index rose 0.56%, France's CAC 40 index increased 0.18%, and the Euro Stoxx 50 index declined 0.86%.
3. As of press time, WTI crude oil rose 0.15% to $95.23 per barrel, while Brent crude oil fell 1.31% to $104.67 per barrel.
Market news
The U.S. September PPI is about to be released: the inflationary impact of surging diesel prices is far from over. The U.S. Producer Price Index (PPI) for September will be released at 20:30 Beijing time on Thursday. This data will serve as a key reference for markets to assess the surge in diesel prices and their inflationary effects ahead of the November midterm elections. Diesel prices rose sharply in August, and there is typically a lag between cost increases at the production and transportation stages and their transmission to consumers—meaning pricing pressures on businesses may still be building. Changes in diesel prices are more prominently reflected in the PPI than in the CPI. Producer price data can offer early signals about future consumer price trends, but previous PPI figures have not yet fully captured the full impact of diesel price hikes. He expects year-over-year readings for September and October to rise significantly. This is why Thursday’s PPI is drawing attention: markets are not only watching the overall index but also seeking to determine whether rising diesel costs are beginning to broadly affect producer selling prices.
The Fed held steady in October, adding another vote: Daly says there’s time to make the right call. San Francisco Fed President Mary Daly said the Fed may need to raise short-term interest rates further to curb elevated inflation, but she indicated no such move was necessary at the Fed’s October meeting. In an interview, Daly said, “We are more likely to need further adjustments, but for me, the timing of those adjustments is still something we’re weighing. I don’t feel an urgency to decide with limited information. I think we have the time we need.” Regarding the U.S. September CPI data released Wednesday, she noted that while the initial reaction was “strong”—with interest rate futures traders quickly betting on a Fed rate hike in October—investors “calmed down” after analyzing the data. The overall increase was driven by rising gasoline prices, while core inflation remained sticky but did not surge sharply.
The so-called "oracle" who first predicted the September rate hike has changed his stance: the Fed may directly raise rates by 50 basis points in December. A forecaster who was among the first to predict the Fed’s most recent rate hike now says that in December,
The central bank may raise rates by a larger margin of up to 50 basis points. Prestige Economics
President Jason Schenk said he believes the Federal Reserve is unlikely to raise rates at this month’s meeting. Instead, he thinks the Fed may take a breather on the September rate hike and then proceed with another increase in December.
The Fed may implement a larger rate hike in December. Schenk said, “By December, if inflation has not been meaningfully curbed after the September hike, they may opt for a 50-basis-point increase rather than 25.”
A basis point, take a bigger bite.” In addition, Schenck believes the Fed will not have enough information at its October meeting to act again, as much of the data released on Wednesday was collected before the Fed’s September meeting.
Collected before the monthly interest rate hike: "I think the data points aren't sufficient to give them the level of confidence they may need."
BTIG: Inflation Comes in Higher Than Expected, Yet Treasury Yields "Fail to Rise"—"Rates and Nasdaq Falling Together" Could Be the Most Painful Trade. U.S. Investment Bank BTIG
indicates that, following higher-than-expected inflation data, the bond market exhibited the typical "news failure"
failure), confirming that U.S. Treasury yields (SHY, TLT, IEF) have reached a tactical peak. This shift has set up a highly contrarian trap trade for equity markets—"falling rates, but Nasdaq declines instead." Klinkoski warns that the truly painful trade direction is the opposite—rates and tech stocks falling together. For investors, this means the previous one-sided logic of "betting on rate cuts and buying tech stocks" may be replaced by a new dynamic: falling yields no longer equate to rising risk appetite, but rather reflect a repricing of growth and earnings expectations.
Burry issues another warning on U.S. stocks: If the "Magnificent Seven" follow semiconductor stocks lower and bond yields decline further, Wall Street may face a "Bloody October." Burry outlines a bearish "Bloody October" scenario: if the "Magnificent Seven" follow semiconductor stocks down while bond yields simultaneously fall, his conviction in this scenario will strengthen. Wednesday’s decline in U.S. Treasury yields failed to lift tech stocks. Burry notes this development warrants caution. He says, “Although the market broadly assumes lower yields are bullish for equities, the current painful trade remains falling rates alongside a declining Nasdaq.” The key watchpoint now is whether weakness in semiconductor stocks will spread to the "Magnificent Seven." Burry adds, “We’ve already seen semiconductor stocks decline in tandem with rates; but if the 'Magnificent Seven' eventually follow suit, it would further reinforce our view of a 'Bloody October.'”
J.P. Morgan warns: This tech sell-off is vastly different from July! Retail investors are abandoning bargain hunting, and short-squeeze ammunition is exhausted. J.P. Morgan’s latest research report highlights that the current environment for AI infrastructure stocks is significantly weaker than the pullback in July last year. Retail investors have so far shown no "buy-the-dip" behavior, compounded by a cliff in buyback flows, thin short positions, and disproportionately high leveraged ETF exposure—leaving this rally with far weaker technical support than the previous one. Strategist Nikolaos
The team led by Panigirtzoglou concluded, after analyzing key metrics such as fund flows, short positions, ETF structures, and corporate buybacks, that the current market lacks several critical catalysts that drove the rapid rebound in stock prices following last July’s correction. The report also noted that, despite recent pullbacks, cyclical stocks have not entered oversold territory from the perspective of positioning and fund flows, indicating that downside risks remain significant. A broad recovery in cyclical stocks requires a combination of factors, including declining bond yields, strong earnings, and a stabilized labor market.
Individual stock news
The sell-off in AI stocks continues. Ahead of Thursday’s U.S. market open, as of press time, chip stocks are broadly lower. SK Hynix (SKHY.US) fell over 7%, SanDisk (SNDK.US), Western Digital (WDC.US), and Seagate Technology (STX.US) dropped more than 5%, Micron Technology (MU.US) slid nearly 5%, Intel (INTC.US) fell over 4%, AMD (AMD.US) declined over 3%, while Qualcomm (QCOM.US), NVIDIA (NVDA.US), and Broadcom (AVGO.US) all dipped nearly 2%. Optical communication stocks also suffered: AXT
Inc (AXT.US) fell over 7%, Credo
Technology (CRDO.US) fell over 6%, Coherent (COHR.US) dropped over 5%, Marvell Technology (MRVL.US), Astera
Labs (ALAB.US), Corning (GLW.US), and Lumentum (LITE.US) all fell more than 4%. Stocks in the AI infrastructure sector, which faced heavy selling pressure on Wednesday, continued to decline in pre-market trading: CoreWeave (CRWV.US) fell nearly 7%, Nebius (NBIS.US) dropped more than 4%, Oracle (ORCL.US) declined over 2%, and Dell Technologies (DELL.US) fell more than 4%.
TSMC (TSM.US) Q3 net profit surged 68.7% year-over-year, exceeding expectations! AI orders flooded in, with 2nm process contributing 8% of wafer revenue. Driven by sustained demand for AI orders, TSMC’s consolidated Q3 revenue reached NT$1.4942 trillion ($46.72 billion), up 50.9% year-over-year and 17.6% quarter-over-quarter, surpassing the company’s guidance range of $44.6–45.8 billion; net profit attributable to owners of the parent was NT$763.06 billion, up 68.7% year-over-year and 8.0% quarter-over-quarter, marking the sixth consecutive quarter of record quarterly earnings and the eleventh consecutive quarter of profit growth; diluted EPS came in at NT$29.43, above the market expectation of approximately NT$28.30. Q4 revenue guidance is set at $52.3–54.3 billion—midpoint representing a ~14% increase over Q3 and significantly above the market forecast of $50.35 billion. By process node, the most advanced 2nm accounted for 8% of Q3 wafer sales revenue (up from 3% last quarter), 3nm contributed 33%, 5nm 28%, and 7nm 10%; advanced nodes (7nm and below) collectively accounted for 79%—the simultaneous volume and price growth in advanced nodes was the core driver behind the revenue beat. As of publication, TSMC shares fell over 2% in pre-market trading on Thursday.
Strong demand for mobile network equipment! Ericsson (ERIC.US) reports Q3 earnings above expectations, but component costs may pressure next year’s gross margin. Ericsson’s third-quarter earnings surpassed analyst estimates, primarily driven by robust demand for mobile network equipment in its core markets. However, the company warned that component costs are expected to pressure gross margins next year. Financial data shows that Ericsson’s GAAP EPS for Q3 was SEK 1.77, exceeding analyst expectations by SEK 0.22; revenue reached SEK 59.5 billion, up 6% year-over-year and SEK 4.17 billion above analyst forecasts. Adjusted gross margin stood at 47.7%, compared to 48.1% in the same period last year. Adjusted EBITDA was SEK 10.1 billion (approximately USD 1 billion), above the average analyst estimate of SEK 7.93 billion. However, this figure was lower than the SEK 15.8 billion recorded in the prior-year period; adjusted EBITDA margin was 17.0%, compared to 28.1% last year. The company explained that last year’s results included SEK 7.6 billion in capital gains, and excluding this factor, adjusted EBITDA showed growth. As of this writing, Ericsson shares rose nearly 12% in pre-market trading on Thursday.
AI two years late: Report says Apple (AAPL.US)
Intelligence is set to enter the Chinese market in December, but its initial features are reportedly scaled back, raising doubts about its prospects. Multiple informed sources reveal that Apple plans to launch Intelligence this December alongside iOS
27.3 System update officially launches its AI platform—Apple
Intelligence (Apple Intelligence), meaning this service will finally enter one of Apple’s most important markets after a lengthy regulatory approval process. The initial launch will include the first batch of AI features introduced in the U.S. two years ago, such as Genmoji custom emojis, notification summaries, writing tools, and the “Clean Up” feature for removing specific objects from photos, covering iPhone, iPad, and Mac. However, the newly released Siri this year
AI assistants and other new features will not be included in this release. Apple initially expected the China-specific AI features to launch in May 2025, then delayed them to the end of 2025, and further postponed them to this spring.
Another delay! Rocket Lab (RKLB.US) postpones the inaugural flight of its Neutron rocket to 2027, causing a sharp drop in pre-market shares. Rocket Lab
Another delay to the maiden flight of its new heavy-lift rocket, Neutron, has pushed the first launch to 2027. This is the latest in a series of delays for the Neutron project. As the company neared launch preparations, it identified new issues in the manufacturing of the rocket’s fuel tanks, prompting this postponement. Rocket
Lab's current flagship rocket is the Electron, designed primarily for launching small satellites into orbit. The Neutron is positioned as a significantly upgraded launch vehicle capable of carrying heavier payloads and directly competing with SpaceX’s dominant Falcon 9 rocket. As of press time, Rocket
Lab fell nearly 10% in pre-market trading on Thursday in the U.S. stock market.
Important Economic Data and Event Calendar
20:30 Beijing Time: U.S. September PPI
8:30 PM Beijing Time: U.S. Initial Jobless Claims for the week ending October 10
8:30 PM Beijing Time: U.S. September Monthly Retail Sales
Earnings Forecast
Friday morning: Alcoa (AA.US), Interactive Brokers (IBKR.US)