U.S. stocks fell as concerns grew that AI profits would not materialize soon enough to cover expensive credit obligations for companies like Core Weave. Fed Chair Warsh avoided signaling a rate move for October, citing firm inflation data. The U.S. budget deficit reached nearly $2 trillion, or 6.2% of GDP.
Import prices rose 1.1% in September, while diesel prices remain high despite supply efforts. Oil futures climbed on Middle East and Russia-Ukraine tensions. China proposed export controls on AI technologies, and France and Germany agreed to protect the auto sector.
Canadian housing starts rose in September, but the market shows cooling signs. Bank of Japan Governor Ueda emphasized keeping underlying inflation near 2%. The eurozone posted a goods-trade deficit in August.
Treasury and European bond yields edged higher amid debt concerns. Upcoming PMI data from the U.S. and Europe will guide interest-rate outlooks. Commerce Secretary Lutnick cast doubt on U.S.-Mexico trade talks by objecting to tariff reductions on Mexican steel, aluminum, and autos.
Moody’s chief credit officer Atsi Sheth noted rising leverage and interest costs are reshaping credit risk assessments. Indonesian stocks plunged to their worst day since 1998 after MSCI warned of a potential index removal.
Source: Wall Street Journal Markets · Summarized by HeadlinesBriefing