Mid-Morning Look: October 15, 2026

Mid-Morning Look

Thursday, October 15, 2026

U.S. stocks slumped on the open, as the futures picture indicated, with the Nasdaq extending Wednesday’s tech-led slide as credit stress across AI infrastructure financing continues to overshadow strong earnings, including Taiwan Semiconductor’s (TSM) blowout Q3 beat. The Dow and Smallcap Russell 2000 however edge higher amid a surprise move lower in Treasury yields. A busy 8:30 AM data slate came in hotter than expected on inflation but mixed elsewhere: September PPI headline jumped +1.3% M/M (vs. +0.5% consensus) and +6.3% Y/Y (vs. +5.3% consensus), Retail Sales rose +0.8% M/M (vs. +0.3% consensus) and +0.9% ex-autos (vs. +0.5% consensus), weekly jobless claims ticked up to 199,000 (vs. 200,000 consensus), Empire Manufacturing surged to 25.5 in October (vs. 10.25 consensus) while the Philly Fed Business Index cooled to 20.9 (vs. 28.4 consensus). Despite the hot inflation prints, Treasury yields reversed sharply lower on a flight to quality tied to the ongoing AI credit angst, with the 10-year falling 13 basis points to 5.06% and the 30-year down 11.9 basis points to 5.406%, both well off yesterday’s highs; gold extends its surge, up $70.20 to $4,178.10 an ounce, the dollar index slides 0.48% to 102.06, and bitcoin falls but paring losses.

Tech pullback continues as the cost of insuring against the risk of potential US tech defaults has hit record levels in the latest sign of credit stress building in the so-called AI trade, especially for data centers dependent on future revenue (NBIS, CRWV, IREN, HUT, WULF, CORZ, CFR, etc.). Although shares in companies driving the AI boom are still among the biggest gainers on global equity markets this year, many have fallen sharply in the past few weeks/months, as investors reassess the cost of capital against a backdrop of rising interest rates and inflation. There are also doubts among some investors and analysts about when, and in some cases, if, the billions of dollars pouring into data centers, computer power and other infrastructure will pay off. For some of their more heavily indebted competitors, suppliers and customers the cost of CDS has risen sharply over the last few days/weeks.  Nuclear power/SMR names also been sliding too (CEG, NRG, VST, TLN, OKLO, SMR, NNE as well as power names PWR, GEV, MTZ).

• Philadelphia Fed Business Outlook index for October fell to 20.9 (vs. consensus 28.4) from 37.8 in September; new orders dropped to 4.3 from 29.2, prices paid declined to 43.2 from 48.6, the employment index slipped to 9.1 from 11.8, and the six-month business conditions index tumbled to 33.0 from 52.9.
• Inflation data ran hotter than expected as the Sept producer price index (PPI) headline rose +1.3% M/M (vs. +0.5% consensus) and +0.4% prior, and +6.3% Y/Y vs. +5.3% consensus and +5.4% prior; core PPI (ex-food & energy) rose +0.7% M/M vs. +0.3% consensus and +0.2% prior, and +5.0% Y/Y vs. +4.4% consensus and +4.6% prior.
• Retail Sales for September rose +0.8% M/M (vs. +0.3% consensus) from +1.2% prior, while Retail Sales ex-autos rose +0.9% M/M (vs. +0.5% consensus) from +1.4% prior (revised from +1.3%); the control group (ex-autos, gasoline, building materials & food services) rose just +0.1% M/M (vs. +0.3% consensus) from +1.2% prior.
• Weekly Jobless Claims climbed to 199,000 from 198,000 prior (and vs. consensus 200,000) as the 4-week moving average climbed to 198,500 from 198,250 prior week (previous 198,000) and continued claims fell to 1.710M from 1.714M prior (v. est. 1.710M).

• Auto sector: PAG announces agreement to be taken private by Penske Corporation and Mitsui & Co. as shareholders to receive $212 per share in cash; enterprise value $16.30B; to hold 64% and Mitsui to hold 36% of company post-deal. KMX was upgraded to Buy from Underperform at Bank America in auto retail and raise tgt to $65 from $50 saying FTC enforcement of price transparency, combined with the company’s own actions, has made CarMax the most price-competitive it has been in years. In auto suppliers, BWA upgraded to Buy from Neutral at Bank America.
• Gold and silver mining stocks (AEM, B, CDE, AG, HL, NEM) are rebounding after coming under pressure on Wednesday as spot gold fell over 1% to $4,095 per ounce following a stronger-than-expected U.S. inflation report. The data increased expectations that the Federal Reserve could raise interest rates this month, strengthening concerns that tighter monetary policy would weigh on bullion prices.
• Homebuilders (KBH, LEN, TOL, DHI) rebound given the surprising move lower in Treasury yields despite hotter CPI, PPI data; the 10-yr yield -13bps to 5.06% after highs 5.32% just yesterday morning. Also seeing rebound in some mortgage related stocks too with names like RKT higher.

• IP +5%; after the Financial Times reported Private equity firms Lone Star and Atlas Holdings are both working on possible deals for International Paper’s European packaging business, citing people familiar with the matter.
• KMB +4%; guided Q3 sales and profit above expectations citing steady demand and cost-saving measures as now sees Q3 sales $4.13B vs. consensus of $4.1B and adj EPS $1.70 topping the $1.59 consensus and also reaffirmed its FY26 outlook.
• NEM +1%; after tumbling on Wednesday, precious metal prices and gold/silver miner stocks (AEM, AG, CDE, HL) rebounded today as the dollar fell along with Treasury yields despite a surging PPI inflation reading today (and higher CPI yesterday).
• PAG +8%; announces agreement to be taken private by Penske Corporation and Mitsui & Co. as shareholders to receive $212 per share in cash; enterprise value $16.30B; to hold 64% and Mitsui to hold 36% of company post-deal.
• WMT +3%; upgraded to Buy from Hold at Deutsche Bank with a $136 price target saying they see a more favorable setup for the shares into 2027 as the current inflationary environment should reinforce Walmart’s value proposition and drive accelerates market share gains.

• FMC -36%; slashes Q3 revenue view to $65M-$125M from $840M-$900M, well below consensus $866.67M and cuts Q3 adjusted EBITDA view to ($565M)-($510M) from $120M-$130M saying the revised expectations now include commercial actions.
• MAN -13%; shares tumbled after guiding Q4 EPS of $1.03-$1.13, the midpoint of which is below the $1.10 estimate, after reporting Q3 revs of $4.84B, below the consensus $4.86B with in-line Q3 adj EPS of $1.01; also named insider Becky Frankiewicz CEO, effective Jan. 1, 2027.
• RKLB -11%; shares fell after saying the inaugural launch of its new, larger Neutron rocket was delayed until next year. Rocket Lab had previously targeted Neutron’s inaugural flight for the fourth quarter of 2026.
• TSM -3%; delivered Q3 results with Q4 rev guidance above expectations, although margin outlook and commentary highlighted ongoing pressure from 2nm and overseas fab ramps despite continued strength in AI demand.
• VNDA -2%; said its experimental drug VQW-765 for social anxiety disorder failed the main goal of a late-stage study, prompting the company to put the program on hold pending further analysis of the data. The study did not show that the drug reduced anxiety compared to placebo.