Daily newsletter · Thu 15 Oct 2026
 | Sharespective Wall Street, before morning tea | Daily newsletter Thu 15 Oct 2026 |
 Running Hot Plus: CoreWeave's bonds now yield almost 15%, and its shares fell 15.46%. |
Good morning. The S&P 500 fell 1.11% on Wednesday to 7,718.94, and the NASDAQ Composite dropped 1.88% to 26,692.87. The Dow lost just 0.09%, because nearly all the damage was in technology.
The trigger was an inflation figure a tenth of a point hotter than expected. Technology shares fell 2.98% as a group. Money moved to the steadier end of the market, and healthcare rose 2.53% while consumer staples added 2.22%.
In company news, Bank of America fell 4.76% after its revenue missed forecasts, a day after the US Treasury fined it more than US$1.2 billion for failing to report suspicious transactions. Elsewhere, Liquidia jumped 26.59% after settling all six of its lawsuits with United Therapeutics, which keeps its lung drug Yutrepia on sale. Finally, Morgan Stanley fell 2.75% even though its revenue beat forecasts at US$20.3 billion.
Hotter than ordered.
Market snapshot
S&P 500 7,718.94 ▼ 1.11% | | NASDAQ 26,692.87 ▼ 1.88% | | NZX 50 13,760.39 ▲ 0.08% |
| | ||||
ASX 200 8,727.90 ▼ 0.64% | | CoreWeave US$65.78 ▼ 15.46% | | Bending Spoons US$53.46 ▲ 41.20% |
| ECONOMY |
Petrol pushed US inflation to 3.7%, and the Fed's next meeting is suddenly live
American consumer prices rose 3.7% in the year to September, up from 3.4% in August. Economists expected 3.6%.
Most of the surprise came from the petrol pump. Petrol prices rose 9.1% in September alone, and that was more than half of the month's 0.6% rise in prices. Core inflation, which leaves out food and energy, ran at 2.6% for the year, against 2.5% expected.
That was enough to change the sums on interest rates. Before the release, futures traders put the chance of a Fed rate rise on 28 October at about 22%, according to CME FedWatch. By Wednesday morning in New York it was above 40%.
Bond yields jumped and then gave it all back. The 10-year Treasury yield rose above 5.3% in the morning. It closed at 5.19%, slightly lower than it started.
Borrowers were already paying for higher rates. The average 30-year mortgage rate in the Mortgage Bankers Association's weekly survey reached 7.50% last week.
Worth pondering whether petrol keeps doing the Fed's thinking for it. Core inflation at 2.6% looks manageable on its own. Our read is that a rate rise aimed at petrol prices would land on mortgage holders long before it did anything about the oil price. |
AI
CoreWeave's bonds now yield almost 15%, and its shares fell 15.46%
CoreWeave fell 15.46% to US$65.78 on Wednesday. The company rents out AI computing power from its data centres, and it has borrowed heavily to build them.
So what spooked investors? The bond market did. The yield on CoreWeave's US$1.25 billion of bonds due in 2032 climbed toward 15% during the day and closed at about 14.5%.
A bond's yield rises as its price falls. So a yield that high means lenders want a big reward for the risk of not being paid back. For comparison, the US government pays 5.19% to borrow for 10 years.
Chief executive Mike Intrator told staff the market was acting irrationally. He said CoreWeave's backlog of signed contracts is more than enough to cover its debts. Elon Musk's reply on X was one word: "Yikes."
The selling spread to other companies building AI capacity. Oracle fell 8.83%, while Dell and Nebius each lost more than 10%. The Philadelphia Semiconductor Index dropped 4.30%, its sixth straight fall, and Nvidia lost 3.16%.
The tell CoreWeave's bond prices more than its share price. Much of the AI build-out runs on borrowed money, and hot inflation makes borrowing dearer. I'd want to see those yields come back down before treating Wednesday as a one-day fright. |
| DEALS |
Berkshire Hathaway bought more of Bending Spoons, and its shares jumped 41.2%
Bending Spoons rose 41.2% to US$53.46 on Wednesday. Berkshire Hathaway is investing another US$330 million in the Italian company, on top of the US$600 million it put in when the shares listed in July.
Bending Spoons owns apps you have probably used. Its stable includes Evernote, Vimeo, WeTransfer, Eventbrite, Airtable and AOL. It buys established tech businesses, reworks them to make more money, and uses the cash to buy more.
The odd part is the price. Berkshire is paying US$33 a share, about 13% below Tuesday's close of US$37.86. Investors then paid far more than that for the shares on Wednesday.
Berkshire's stake will be about 4%, making it Bending Spoons' sixth-largest investor. The shares are now up about 84% from their US$29 listing price.
Chief executive Luca Ferrari called Berkshire among the finest capital allocators in the world. Co-founder Francesco Patarnello said the new money gives Bending Spoons more room to make acquisitions.
The catch at Wednesday's close the shares were worth about 62% more than Berkshire is paying. Bending Spoons still has to earn that price by squeezing more profit out of older apps, and that work shows up over years. |
Newsworthy numbers
| | |
US$21 billion Japanese money behind two new chip factories that GlobalFoundries will run in Malta, New York, under the US-Japan trade deal. | | 9.1% how much of GameStop its chief executive Ryan Cohen now owns, after buying more than 800,000 shares on Tuesday. |
| | ||
| | |
1.93% how far the Russell 2000 index of smaller American companies fell on Wednesday, more than the S&P 500. Small firms tend to borrow more. | | 1.9 seconds the 0-to-60mph time Tesla promised for its new Roadster in 2017. The car finally gets its reveal near Waco, Texas, on Thursday. |
Worth a read
| |
01 | As term deposit rates lag the overall rises in wholesale and home loan rates, savers will need to shop around to extract better returns — David Chaston on savers being left behind. Some finance companies pay 5%, while the main banks sit between 3% and 4.6% for three years. |
| |
02 | These killer drones are declaring war on mosquitoes — Bill Meincke on Tornyol, a French startup whose 40-gram drone hears a mosquito's wingbeat and rams it mid-flight. |
| |
03 | BYD expands EV shipping fleet as wars upend freight costs and key trade routes — Indranil Ghosh on why the Chinese carmaker is going from 8 to 18 car-carrying ships by 2029. Renting a car carrier now costs about US$95,000 a day, up from US$50,000 in February. |
| |
04 | 210-million-year-old dinosaur discovery reveals a lost world in Africa — Paul Barrett and Jonah Choiniere's team named a new dinosaur from near Lake Kariba. Zimbabwe's dinosaurs turn out to differ from South Africa's, despite living close by. |
| |
05 | A Place Among the Fiddlers — David Alm spends a week at the 90th Old Fiddler's Convention in Galax, Virginia, where a broken string ends your turn and electric instruments are banned outright. |
Wrapping up
The Fed's 28 October decision has changed shape. On Tuesday a rate rise was about a one-in-five chance; after Wednesday's inflation figures it is better than two in five. The decision lands at 7am on Thursday 29 October in Auckland and 5am in Sydney.
US Bancorp reports before Thursday's open in New York, and after Wednesday's rate scare its deposit costs are the line to watch. Travelers, the insurer, follows on Friday, with catastrophe losses the number to look for.
The kiwi slipped, taking USD/NZD back up to 1.79. USD/AUD held at 1.43.
Labour Weekend is a week from Saturday. See you tomorrow.