Even before last week’s selloff, we all felt like we had white knuckles during the fourth quarter.
Anthropic (ANTH.PVT) IPO prospectus. Big tech gains. Bond yields are skyrocketing. An unexpectedly high blue wave that sent the stock market rising – and then falling again.
While volatility (^VIX) is very high, investors are balancing on the knife’s edge between a flywheel of anxiety and a rebound.
As Goldman Sachs’ Panic Indicator suggests, the extreme could signal a continuation of Friday’s rebound ahead.
It’s a new week and we’ll have plenty of plot points scheduled to guide us.
Of particular note, we look forward to quarterly results from CoreWeave (CRWV) on Tuesday and Nebius Group (NBIS) and Cerebras Systems (CBRS) on Thursday, a few companies caught up in the post-election data center destruction.
What they have to say about their plans and prospects, the debt markets they have tapped, and the health of their business will be top of mind.
It’s a good time to have this just a week after midterms.
On the economic calendar, we’re in inflation mode again, especially after this red-hot jobs report.
We’ll start the week with consumer inflation expectations from the New York Fed before getting actual data on Tuesday – and big inflation numbers on Friday to close out the week.
2 Big AI Narratives Continue to Fight for Market Control
Which is more important: the business of AI chips and infrastructure or the companies that actually provide AI?
As we wrote in the Morning Brief on Friday: “A slowdown in data centers is bad for the stock market AI engine” and “A data center slowdown is GOOD for the Big Tech profit machine. »
Can Google (GOOG, GOOGL), Microsoft (MSFT) and Amazon (AMZN) deliver AI at least some productivity and tools to customers with the compute they have – and make a lot of money doing so, moving from growth and scale to monetization?
Maybe! These companies have been in the green since the elections and are doing very well in a context of widespread liquidation. And while Tesla (TSLA) has sold off, SpaceX (SPCX) is generally doing well.
The CoreWeave AI data center is shown under construction on October 21, 2026 in Kenilworth, NJ (Stephanie Keith/Getty Images) ·Stephanie Keith via Getty Images
As DataTrek’s Nicholas Colas wrote on Thursday, you need to look at the entire week, not just Bloody Thursday, to see the big picture (no matter how small). And it’s pretty clear that this can be reflected in the general clues, but it’s mostly bullet points.
“As for what the market is saying over the past two days, we believe the moves are AI-centric and not omens of an impending recession,” Colas wrote, also noting that Google and Co. are doing well.
The push-pull of the chip narrative and the hyperscaler narrative is the pulse our fingers are on right now.
Big inflation check after booming jobs report
Friday’s jobs report, covering 165,000 jobs, delivered an unexpected verdict on the current state of the job market: It’s better than good.
Even September’s disappointing 29,000 jobs figure was revised upwards to 60,000.
Good for breaking the ice of “low fire, low hiring,” if that represents the start of a trend. As all Fed chairs like to remind us, a month means nothing in itself.
The main takeaway from the report, however, is not that the job market is heating up, but that there is no need to worry about weakness or a recession at this time.
Customers check fruit at a grocery store in New York, October 14, 2026. (Zhang Fengguo/Xinhua via Getty Images) ·Xinhua News Agency via Getty Images
But with October’s important inflation reports coming out Tuesday and Friday, we’ll have more than just one data point to work with, and two (or more) hot economic data points might start to make some people sweat.
We’re keeping in mind a research note from Apollo’s Torsten Sløk that caught our attention last week: the Fed rates needed to bring inflation below its 2% target could reach 6.75%. (Disclosure: Yahoo is a holding company for funds managed by affiliates of Apollo Global Management.)
While data center liquidation is obviously important, inflation still matters as much as anything.
Bloomberg analysts’ average estimate calls for core inflation to rise 0.2%, a slowdown from 0.3% last month.
Many Fed Post-Election Speeches Coming
Amidst all the data, there will be lots of comments from people reading the data and deciding what to do with it.
Fed’s Goolsbee and Bowman to speak Monday; Waller and Bowman (again) Tuesday; Barr, Barkin and Logan on Thursday; and Williams, Jefferson and Bowman (again) on Friday.
We love to see our public officials working hard. But the market likes the guidance and FedSpeak even more and hopes to have a bigger lens through which to read all this data and get a better sense of how the Fed views the economy — and maybe even the selloff, depending on the topics covered and how open-minded they are.
Right now, after Friday’s jobs report, December’s rise looks more likely.
As Fed Chairman Warsh settles into an enigmatic, taciturn rhythm with no future direction, it’s up to these guys — who may also be feeling more emboldened after the midterms.
As JPMorgan pointed out last week, the new Democratic leadership in the Senate will be important for the Fed.
Economic and earnings calendar
Monday
Economic data: New York Fed consumer inflation expectations for October (previously 3.9), wholesale inventories for September
Earnings schedule: Constellation Energy (CEG), KKR (KKR), Barrick Mining (B), Occidental Petroleum (OXY), Skydance (SKYD), Take-Two Interactive Software (TTWO), NRG Energy (NRG), Kaspi.kz (KSPI), Paramount Skydance (PSKY), Praxis Precision Medicines (PRAX), Sanmina (SANM), Clearway Energy (CWEN), Qualys (QLYS), H&R Block (HRB), Ionis Pharmaceuticals (IONS), Casella Waste Systems (CWST), The Trade Desk (TTD), Hims & Hers Health (HIMS), NexGen Energy (NXE), monday.com (MNDY), Archer Aviation (ACHR), Via Transportation (VIA), USA Rare Earth (USAR), Plug Power (PLUG), Lucid Group (LCID), Trump Media & Technology Group (DJT)
