Investing for Survival: tariffs

Wednesday morning setup: US futures are higher, with small caps leading and tech lagging, as traders brace for what is expected to be the hottest monthly CPI print since the spring, digest more escalation in the Gulf after Yemen's Houthis hit Saudi Aramco's Dhahran headquarters and vowed more strikes on Saudi airports and oil facilities, and countdown to Anthropic's pre-IPO investor day which one strategist warns "will move the entire market"; as a result oil is grinding higher while the bond rout takes another breather with the 10Y sliding to 5.20%. As of 8:15am ET, S&P futures are 0.2% higher at 7,872 while Nasdaq futures are down 0.1% and Dow futures are up 0.4%; Russell 2000 contracts are up 0.3%. On Tuesday, the S&P closed fractionally lower (-0.02%) as the Philly semi index posted a fifth straight drop - its longest losing streak since July - and the KBW Banks index slid 1.4% with all 24 members lower on day one of bank earnings. In premarket trading, Mag 7 names are mostly higher led by Alphabet, BlackRock jumps after pulling in $205 billion in new money, while Bank of America slips after a $1.21 billion money-laundering fine (as we reported yesterday) and an equities trading miss; memory names are again under pressure (MU -1.4%, SNDK -2.3%), extending the memory meltdown, even as ASML's beat-and-raise sparked a modest rally in Europe. The day's driver is CPI: consensus expects headline to jump 0.6% M/M and 3.6% Y/Y - the biggest monthly advance in five months on the back of surging gasoline prices - with core seen at 0.2%, while swaps price roughly 24% odds of a quarter-point hike at the Oct. 28 FOMC, meaning that the print "mostly decides December". Treasuries are slightly richer, with yields down about 1bp across the front-end and belly and the 10Y at 5.20%, dragged lower by a rally in gilts after BoE Chief Economist Huw Pill cast doubt on market pricing of four hikes by next summer and the FT reported Chancellor Healey will fund budget giveaways with taxes or spending cuts rather than more borrowing. The Bloomberg dollar index is little changed, while the Aussie is the best G-10 performer after blowout Chinese trade data. In commodities, WTI has swung between gains and losses and was last up around 1.6% as traders weigh the latest Middle East hostilities, after the IEA warned diesel supplies will remain constrained well into 2027 and OECD government oil stocks hit the lowest since 1989; gold slips 0.4% to $4,144 and silver drops over 1% to its lowest since August, while copper is firmer. Bitcoin is flat around $83,000. US economic data slate includes MBA mortgage applications (already out: -2.7%) and September CPI (8:30am); the Fed releases its Beige Book at 2pm. Fed speaker slate includes Barkin (1:30pm), Goolsbee (3pm) and Bowman (10:55pm). The Treasury sells $75 billion in 17-week bills at 11:30am.

Fundamental

Headlines

The Economy

Weekly mortgage applications fell 2.7% while purchase applications were down 0.4%.

Month to date retail chain store sales were up 10.4% versus 8.6% in the prior week.

September existing home sales rose 1.5% versus consensus of -0.3%.

https://bonddad.blogspot.com/2026/10/the-subpar-equilibrium-in-existing-home.html

International

September Chinese CPI rose 0.2% versus predictions of +0.3%; September YoY PPI was up 5.0% versus +4.5%; the September trade balance was +$133.5 billion versus +$118.5 billion.

September German PPI was up 1.9% versus estimates of +0.7%.

Other

Overnight News

Iran is deploying new tactics to target ships sailing through the Strait of Hormuz as it seeks to keep oil prices high and influence the US midterm elections, two senior Iranian officials told Reuters.

Oil edged higher as attacks on Saudi Aramco's headquarters added to a flare-up in the Middle East conflict, increasing uncertainty over a recovery in Persian Gulf energy flows.

Yemeni Army Spokesperson said operations towards Saudi airports and oil facilities will continue in the coming days and warned for global shipping companies, civilians and workers to evacuate such airports and firms, as they are legitimate targets.

Fiscal Policy

The burden is ours, not our grandchildren’s.

https://www.realclearmarkets.com/articles/2026/10/13/were_burdening_the_children_is_an_abjectly_keynesian_fatuity_1210908.html

The huge lurking leverage in AI.

https://giftarticle.ft.com/giftarticle/actions/redeem/9981aaea-42af-480e-a783-ea7976c2b0f5

The 11% AI chip loan the big banks refused to underwrite.

https://www.zerohedge.com/ai/when-goldman-jpm-wont-hold-it-should-you-11-ai-chip-loan-banks-refused-underwrite?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTI4MjEzIiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc5MTkyMDgxNywiZXhwIjoxNzk0NTEyODE3LCJhdWQiOiJ6aC1naWZ0In0.vYlKzg3GwpoBcsWK4G4mBD0QPDLm-czFT9DAhlBVxZs

One more problem for the hyperscalers.

https://www.zerohedge.com/energy/big-tech-pushes-back-paying-grid-was-crumbling-long-ai

Tariffs

Manufacturing surged when tariffs were lifted.

https://thedailyeconomy.org/article/manufacturing-surged-when-tariffs-were-lifted/

Investing

Paul Tudor Jones versus Goldman on the 2027 market outlook.

https://www.zerohedge.com/markets/ill-be-short-whole-year-paul-tudor-jones-warns-looming-dot-com-style-equity-supply-tsnuami

Stocks keep climbing but leadership may be changing.

https://www.capitalspectator.com/stocks-keep-climbing-but-market-leadership-may-be-shifting/

Will bonds blow up?

https://trendlabs.com/will-bonds-blow-up/

The starting yield on a bond largely dictates your future return.

https://bondvigilantes.com/blog/2026/10/bonds-have-their-mojo-back/

The latest from Morgan Stanley.

https://www.zerohedge.com/markets/feds-unpaid-intern-ms-wilson-says-tighter-financial-conditions-are-already-doing-warshs-job?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTI4MjU5Iiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc5MTkyMjc0OCwiZXhwIjoxNzk0NTE0NzQ4LCJhdWQiOiJ6aC1naWZ0In0.eSeAaInacXpDKTYleDqvU7x5FRTfS5LutZ-H-Tu2iS8

News on Stocks in Our Portfolios

What I am reading today

New era of investment for the defense industry.

https://www.realclearmarkets.com/articles/2026/10/13/a_new_era_of_investment_for_the_defense_sector_1211123.html

Visit Investing for Survival’s website (http://investingforsurvival.com/home) to learn more about our Investment Strategy, Prices Disciplines and Subscriber Service.

Friday, October 9, 2026

The Morning Call--the crowding out effecr is immense

The Morning Call

10/9/26

The Market

Technical

Thursday in the charts.

https://www.zerohedge.com/markets/headline-roulette-back-ai-angst-mideast-missiles-spark-chaos-capital-markets?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTI3NzA0Iiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc5MTQ5MDYxOCwiZXhwIjoxNzk0MDgyNjE4LCJhdWQiOiJ6aC1naWZ0In0.ayfK8qEQhcClsOPka6anBRsurvqTd_sZHg675POIrs8

Note: the S&P failed the break to new highs, meaning Tuesday’s spike had no follow through momentum. So, we are still stuck in a trading range albeit at a very high level. The thing that I am watching now is whether the index makes a second higher low (good news) or not.

Thursday 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

The room at the top is crowded.

https://talkmarkets.com/article/the-room-at-the-top-of-the-sp500-has-become-twice-as-crowded

A decade of bad breadth.

https://talkmarkets.com/article/decade-of-bad-breadth

Dealing with narrowing breadth.

https://talkmarkets.com/article/a-bull-market-party-with-a-very-small-guest-list

Friday morning setup: US futures are higher as a trifecta of AI relief, easing geopolitical tensions and fading energy prices has lifted sentiment into the final trading day of the week: OpenAI walked back Thursday's FT-sparked revenue scare by telling people it expects to reach or exceed $70 billion in annualized revenue by year-end, while President Trump said the US would not attack Iran before the November midterms; as a result Nasdaq futures are up 0.8% and Brent has slipped back toward $102 after nearly touching $106 on Thursday. As of 7:15am ET, S&P futures are 0.4% higher at 7,850 while Nasdaq futures are up 0.8% and Dow futures rise 0.2%. That follows a session in which the S&P fell 0.47% to 7,765 and the SOX tumbled 3.4% after the FT reported OpenAI's annualized revenue was about $50 billion, even as two thirds of S&P members finished higher. In premarket trading, tech leads with Nvidia up 2% and the SOXX ETF up 1.9%, while Apple is the notable Mag 7 laggard, down 2% on a report it cut iPhone 18 Pro component orders, confirming our article from yesterday; telecoms are getting crushed (AT&T, Verizon and T-Mobile all down 6-7%) after SpaceX bought a nationwide low-band spectrum portfolio, tower stocks jump and Humana soars 15% on better Medicare Advantage ratings. The day's driver is oil (again), but this time on the way down: WTI is down 0.9% to $90.67 and Brent is down 1.3% to $102.92 even as Hurricane Isaias has shut in some 1.3 million b/d, or 63%, of Gulf of Mexico crude output. Treasuries are the exception to the global bond relief rally: yields are 1-2bps cheaper across the curve, led by the front-end, with the 10Y around 5.245% after Thursday's 6bp bull-flattening rally, while bunds and gilts outperform after Christine Lagarde told finance ministers the ECB has tools for disorderly spread moves. The Bloomberg dollar index is down 0.1%, with the yen the only G10 currency lagging. In commodities, gold is up about 1.3% and has climbed as high as $4,208, silver is up 2% to above $60, US natgas is down 1.5% to $3.12 and copper is firmer. Bitcoin adds about 1%, trading near $82,500. US economic data slate includes the October preliminary University of Michigan sentiment and inflation expectations (10am). Fed speaker slate includes Collins (4pm). The US bond market is closed on Monday.

Fundamental

Headlines

The Economy

International

August Japanese household spending rose 0.1% versus consensus of +0.5%; September YoY machine tool orders were up 60.4% versus +61.0%.

Other

Hurricane Isaias causes partial shutdown of Gulf oil production.

https://www.zerohedge.com/weather/25-us-offshore-gulf-oil-output-shut-hurricane-isaias-nears-threatens-refineries

Edging toward a fiscal crisis.

https://www.axios.com/2026/10/07/france-global-bond-markets

Taxes have consequences.

https://www.powerlineblog.com/archives/2026/10/taxes-have-consequences.php

The correlation of new jobless claims to future recession.

https://bonddad.blogspot.com/2026/10/new-jobless-claims-continue-near.html

Iran

Overnight news.

https://www.zerohedge.com/geopolitical/iran-expands-tanker-assault-beyond-narrow-confines-hormuz-rare-escalation

Monetary Policy

The ECB QT continues---and to what effect?

https://wolfstreet.com/2026/10/08/still-qt-plus-renewed-rate-hikes-at-the-ecb-despite-surging-bond-yields-in-the-euro-area/

Tuesday, October 6, 2026

The Morning Call--When does the credit party end?

The Morning Call

10/6/26

The Market

Technical

Monday in the charts.

https://www.zerohedge.com/markets/crazy-continues-stocks-breadth-down-yields-oil-down?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTI3Mjk1Iiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc5MTIzMjg3MSwiZXhwIjoxNzkzODI0ODcxLCJhdWQiOiJ6aC1naWZ0In0.FDKMkQZvoRh8prq6nCmQes0rfJodaxfwv-EfZCwMBGo

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

Asset managers dumping S&P futures.

https://www.zerohedge.com/markets/64-billion-quiet-selling-goldman-shows-asset-managers-dumping-sp-futs-soft-data-rally?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTI3MjgyIiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc5MTIzMTQyNSwiZXhwIjoxNzkzODIzNDI1LCJhdWQiOiJ6aC1naWZ0In0.Yhu8J6KDP-kw0hCHh74WieifzgGs3cHe4ISSQ3wlDZc

Tuesday morning setup: US equity futures are higher for a fourth day, putting the S&P on course for its longest winning streak in two months, and on pace for a record open. Tech is leading again, though the rest of the market is finally joining in, and the bond market has stopped screaming for a few hours. As of 8:00am ET, S&P futures are 0.5% higher at 7,865 and Dow futures are up 288 points; Nasdaq futures were up 0.3% and follows a session in which the Nasdaq and the Mag 7 printed fresh records even as the 10Y closed at a post-2002 high of 5.31%. In premarket trading, semis lag Nasdaq futures as the Mag 7 and Software outperform; Cyclicals ex-Energy lead Defensives and most sectors are indicated higher, which JPM calls a "notable broadening." Nvidia is on the verge of becoming the first $6 trillion company, Constellation Energy jumps after inking an 890 MW nuclear deal with Google, and Option Care soars 23% on a report of a McKesson/CD&R bid. Today's sentiment tailwind is oil: WTI is down about 2% to $87.62, and Brent has slipped back below $100, touching $98.47. Saudi Arabia says its East-West pipeline is back to 5.8 million b/d. The oil drop helps global bonds catch a bid, led by a sharp rally in French and Italian debt as Marine Le Pen unveils her budget plans. The 10Y yield is down about 4bps to 5.27%, and the curve is bull flattening, with 2s10s about 2.5bps tighter. The Bloomberg dollar index is down 0.2% at the day's low after setting a 52-week high yesterday; cable is at its highest since October 1 and the euro has pared Monday's losses. In commodities, Energy is under pressure while Ags and Metals are bid gold has rebounded from $4,104 to above $4,150, silver is little changed around $61, and US natgas is up 0.3% to $3.08, while European TTF gas jumps more than €3/MWh. Bitcoin dipped toward $85,000 overnight before recovering to $86,000. US economic data slate includes the ADP weekly employment change (8:15am ET) and the August trade balance (8:30am). Fed speaker slate includes Williams (9:05am), Musalem (10:45am), Bowman (10:46am), Schmid (1:15pm) and Logan (7pm). Treasury sells $58bn in 3-year notes at 1pm.

Fundamental

Headlines

The Economy

The September services PMI was 58.8 versus estimates of 58.7; the September composite PMI was 58.4, in line.

The September ISM services index was 54.9 versus expectations of 55.0.

https://bonddad.blogspot.com/2026/10/economically-weighted-ism-indexes-for.html

International

August German factory orders fell 10.6% versus consensus of -1.0%.

The September Japanese consumer confidence index came in at 35.4 versus predictions of 35.3.

September EU retail sales were up 0.1% versus forecasts of +0.2%.

The September EU construction PMI was 43.4 versus projections of 43.0; the September German construction PMI was 43.5 versus 48.0; the September UK construction PMI was 46.1 versus 45.2.

Other

Production over consumption is the source of growth.

https://www.forbes.com/sites/johntamny/2026/10/04/who-needs-central-planning-when-we-have-conservatives/

The economy is not working like it should.

https://quoththeraven.substack.com/p/the-nerve-center-of-our-economic?r=1ng8jx&utm_campaign=post-expanded-share&utm_medium=web

Euro hits seventeen month low.

https://www.bloomberg.com/news/articles/2026-10-05/euro-falls-to-17-month-low-on-region-s-fiscal-political-risks?utm_source=website&utm_medium=share&utm_campaign=copy

France is cracking, the euro is imploding.

https://www.zerohedge.com/the-market-ear/france-cracking-euro-imploding-and-now-dirty-sanchez-joins-mess?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTI3MjI0Iiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc5MTIzMTc5OCwiZXhwIjoxNzkzODIzNzk4LCJhdWQiOiJ6aC1naWZ0In0.P6DWSxjaJsFIL70jHVYwP-wh2seSfgfl3c8In6KvERU

Iran

Overnight news.

https://www.zerohedge.com/geopolitical/houthis-seize-yemen-parliament-speakers-home-cut-taiz-aden-lifeline-all-out-war-erupts

Inflation

Truckers are having a tough time surviving.

https://www.wsj.com/economy/truckers-are-using-every-trick-they-can-to-survive-soaring-diesel-prices-0af349aa?st=m3Qoi7&reflink=desktopwebshare_permalink

Robots are not coming for your job.

https://www.apollo.com/wealth/insights-news/insights/daily-spark/robots-are-not-coming-for-your-job

When does the credit party end?

https://www.zerohedge.com/markets/when-does-credit-party-end-goldman-morgan-stanley-map-ai-debt-binge-edges-start-crack?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTI3MzExIiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc5MTI5MjAwMywiZXhwIjoxNzkzODg0MDAzLCJhdWQiOiJ6aC1naWZ0In0.hzorpS5QKvVy0NmfzG-kAmk0eh-jz4eNiAmrNmZB3T0

Tariffs

The simple case for free trade.

https://thedailyeconomy.org/article/keep-the-case-for-free-trade-simple/

Investing

The AI wealth effect.

https://www.axios.com/2026/10/01/ai-wealth-stocks-economy

Is it time to nibble at bonds?

https://wolfstreet.com/2026/10/03/a-wild-week-for-10-year-30-year-treasury-yields-is-there-blood-in-the-streets-yet-is-it-good-enough-for-me-to-nibble/

Treasury yields haven’t cracked the bull market…yet.

https://www.capitalspectator.com/rising-treasury-yields-havent-cracked-the-bull-market-yet/

The math that breaks retirement.

https://talkmarkets.com/article/sequence-of-return-risk-the-math-that-breaks-retirements

Global pension funds cut US equities exposure.

https://giftarticle.ft.com/giftarticle/actions/redeem/6ff32057-a20f-41ac-8ced-9a33d86adbcf

News on Stocks in Our Portfolios

What I am reading today

Visit Investing for Survival’s website (http://investingforsurvival.com/home) to learn more about our Investment Strategy, Prices Disciplines and Subscriber Service.

Wednesday, October 14, 2026

The Morning Call---Paul Tudor Jones' 2027 outlook

Friday, October 9, 2026

The Morning Call--the crowding out effecr is immense

Tuesday, October 6, 2026

The Morning Call--When does the credit party end?

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