The Morning Call
10/13/26
The
Market
Technical
Monday in the
charts.
Monday in the technical
stats.
https://www.barchart.com/stocks/momentum
https://www.barchart.com/stocks/market-performance
https://www.barchart.com/stocks/sectors/rankings
https://www.barchart.com/stocks/signals/new-recommendations
No offense is
being played.
Bond shorts are
sitting on a powder keg.
Gold tumbles as
oil shock fuels dollar rally.
https://talkmarkets.com/article/gold-tumbles-as-oil-shock-fuels-us-dollar-rally-and-fed-hike-bets
Tuesday morning
setup: US futures are mixed with the Nasdaq lagging as the AI rout that started
on Wall Street on Monday ricocheted through Asia, where the Kospi crashed as
much as 7% after Broadcom's
Hock Tan likened AI investing to a casino and China's CXMT touted a denser
memory chip design, while Q3 bank earnings kicked off with a FICC
trading miss at JPMorgan; as a result, a flight to safety sent 10Y yields
5bps lower to 5.19% as cash Treasuries reopened after the holiday, while Brent
slid back toward $105. As of 8:00am ET, S&P futures are down 0.1% around
7,850 while Nasdaq futures slide 0.7%, Dow futures are up 0.7% and Russell 2000
futures rise 0.3%. That follows a session in which the S&P dipped 0.1% and
the Nasdaq 100 fell 0.7% on what was the lowest
volume session in 23 years, with the SOX down 2.7% for its fourth straight
decline even as two-thirds of S&P members rose. In premarket trading,
memory names are getting hammered again (Western Digital -4.5%, Seagate -4.1%,
Sandisk -3.7%, Micron -2.8%) and Nvidia is the worst of the Mag 7, down 0.9%,
while JPMorgan is flat after FICC revenue of $5.37BN missed the $6BN estimate
but the company guided NII higher; UnitedHealth rises 2.8% after raising its
guidance. The day's driver is AI angst (again): Hock Tan's warning
that financing the buildout, not chip supply, is the problem (as we
discussed yesterday) was the spark, while CXMT's progress on new DRAM
architecture did the rest in Seoul, where Samsung and SK Hynix lost around 8%
and 10%. Treasuries rallied, with yields down 2-5bps led by the 10Y, after Fed
Governor Waller said the surge in long-term yields is doing some of the work of
tighter policy, while bunds and gilts gained as lower energy prices eased
inflation worries. The BBG dollar index is down 0.2%, snapping a four-session
winning streak, and the yen leads G10 after a report that the BOJ is leaning
against a back-to-back hike in October. In commodities, WTI is down about 1.5%
near $92.3 and Brent is 1.7% lower to $104.6; gold rises 0.3% to around $4,190,
silver is up 0.4% near $60.5 and copper is flat. Bitcoin regains $83,000. US
economic data slate includes September NFIB small business optimism (already
out: 97.9 vs est. 98.2), ADP weekly employment change (8:15am), September
existing home sales (10am) and the September federal budget balance (2pm). Fed
speaker slate includes Goolsbee (7am and 10am), Barkin (1pm) and Collins (4pm).
The Treasury sells $95BN of 13-week and $82BN of 26-week bills at 11:30am and
$95BN of 6-week bills at 1pm.
Fundamental
Headlines
The
Economy
US
The September
small business optimism index came in at 97.9 versus estimates of 98.0.
International
September Japanese PPI
was down 0.3% versus projections of +0.5%.
September German CPI was +0.6%, in line.
Other
World’s energy
order being tested again.
A super El Nino is
looking more likely.
A wealth boom and
price shock collide.
https://www.reuters.com/business/finance/us-a-wealth-boom-price-shock-collide-2026-10-12/
Overnight
News
Iran is fortifying
its defenses, rallying loyalists, and hinting that their forces could
conduct land incursions into neighboring countries as it threatens a
wider, harsher response against the U.S. and its Gulf allies as it prepares for
potential American attacks after the midterms and seeks to deter them.
JPMorgan and
Goldman Sachs have taken a rare move to limit exposure on a $5 billion loan
sale for AI startup Volta Infrastructure as investors demand higher yields for
risky debt tied to the AI boom.
Monetary
Policy
Rising bond yields are no excuse for central
bank inertia.
Fiscal
Policy
Rising concerns over government debt.
https://giftarticle.ft.com/giftarticle/actions/redeem/4b06e5f6-793c-4c24-a347-f5a0cf194558
Inflation
The Houthi escalation raises the risk of higher
inflation.
https://www.capitalspectator.com/a-new-middle-east-flashpoint-raises-the-stakes-for-inflation/
AI
Broadcom
CEO says investors are gambling in a casino.
Microsoft slashes token costs
How the AI boom ends.
Investing
The Market’s margin of error has narrowed.
https://www.briefing.com/todays-free-feature
Why stocks are
rising despite higher interest rates.
How long can above
average returns last?
Is the ten year Treasury finally a buy?
https://talkmarkets.com/article/bonds-at-5-is-the-10-year-treasury-finally-a-buy
Why is China
stacking gold?
https://talkmarkets.com/article/why-is-china-stacking-gold
AI is no longer a
brain in a jar.
The stock market
is not the economy.
Counterpoint.
https://talkmarkets.com/article/monthly-macro-monitor-the-stock-market-is-the-economy
Five steps to take
right now (in your portfolio).
https://ritholtz.com/2026/10/5-steps-to-take-right-now/
News on Stocks in Our Portfolios
What
I am reading today
The
gambling epidemic.
https://www.advisorperspectives.com/commentaries/2026/10/12/gen-z-bets-against-future
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for Survival’s website (http://investingforsurvival.com/home)
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