The U.S. National Highway Traffic Safety Administration (NHTSA) has launched an investigation into 2.88 million Tesla vehicles equipped with its Full Self-Driving (FSD) system after more than 50 reports of traffic-safety violations and crashes, according to Reuters.

NHTSA said FSD, which requires driver supervision, has “induced vehicle behavior that violated traffic safety laws.”

Reports include Teslas running red lights and making lane changes against oncoming traffic. The agency is reviewing 58 cases, including 14 crashes and 23 injuries. Six involved vehicles driving through red lights and colliding at intersections; four crashes caused injuries.

A driver in Houston told NHTSA that FSD “is not recognizing traffic signals. This results in the vehicle proceeding through red lights, and stopping at green lights.”

The complaint added: “Tesla doesn’t want to fix it, or even acknowledge the problem, even though they’ve done a test drive with me and seen the issue with their own eyes.”

Reuters writes that the probe, a preliminary evaluation, could lead to a recall if regulators find an unreasonable safety risk. It will also review FSD behavior at railroad crossings. Tesla, which issued a software update to FSD this week, did not respond to requests for comment.

The investigation comes amid mounting scrutiny of Tesla’s driver-assistance features.

In October 2024, NHTSA opened a separate inquiry into 2.4 million Teslas after crashes in poor visibility, including a 2023 fatal accident. In January, regulators began probing 2.6 million vehicles over a remote-movement feature, and they are also reviewing Tesla’s self-driving robotaxis in Austin.

On August 1, 2025 a Florida jury ordered Tesla to pay $329 million in damages after finding the company partially liable in a 2019 crash that killed 22-year-old Naibel Benavides Leon and seriously injured her boyfriend.

The jury ruled that Tesla’s Autopilot driver-assistance system failed to prevent the collision, even though the driver admitted being distracted at the time. The verdict marks a rare instance of Tesla being held responsible for a fatal accident and could set an important precedent for the legal risks facing automated driving technology. Tesla disputes the ruling and plans to appeal.

On September 19, President Trump issued a proclamation imposing a $100,000 one-time fee on new H-1B visa petitions.

He’s also pressing for equity stakes for the federal government in strategic U.S. firms—such as a reported bid for up to 10% ownership of Lithium Americas tied to its DOE loan deals. And the administration already holds stakes in Intel, MP Materials, and others, shifting grants and subsidies toward direct ownership.

The moves have brought an ideological divide on the right to the surface. Namely between the libertarians, capitalists, “free market” guys and MAGA, nationalist, America First camps.

ZeroHedge is putting it on trial, tonight.

Tonight at 7 pm ET, live on the ZeroHedge homepage, X, YouTube, and Rumble:

Peter Schiff vs. Spencer P. Morrison and moderated by Keith Knight.

Topic: Do Trump’s worker-first policies save America—or destroy it?

Peter Schiff has warned broadly about the GOP shift toward protectionism:

Let me get this straight: the Republican Party now favors concentrating power in one individual to impose protectionist tariffs, centrally plan the economy, nationalize stakes in private businesses, and use the Fed to create massive inflation to monetize soaring budget deficits.

— Peter Schiff (@PeterSchiff) August 25, 2025

On the H-1B surcharge, Schiff argues it may backfire:

One of the unintended consequences of Trump’s $100K fee on H-1B visas is that companies will outsource the work outside of the U.S. Remote workers won’t pay U.S. income taxes or spend their earnings in ways that benefit local landlords or other U.S. businesses and their workers.

— Peter Schiff (@PeterSchiff) September 26, 2025

Morrison, by contrast, insists the $100K H-1B “fee” is far too weak to protect American labor and was ticked off by Trump/Lutnick’s reversal from it being an annual fee to one-time:

Tune in at 7 pm ET on ZeroHedge / X / YouTube / Rumble. It will subsequently be posted to our Spotify.
 

Last week we published a lengthy article discussing in detail the current generation’s (because every generation has one, just ask Global Crossing) “infinite money” circle jerk circular deals which have become the de jour staple of the AI bubble and which, simplified, look something like this…

… or, using a slightly more sophisticated variation from Bloomberg, like this…

… which JPM’s Michael Cembalest described laconically as follows…

Oracle’s stock jumped by 25% after being promised $60 billion a year from OpenAI, an amount of money OpenAI doesn’t earn yet, to provide cloud computing facilities that Oracle hasn’t built yet, and which will require 4.5 GW of power (the equivalent of 2.25 Hoover Dams or four nuclear plants), as well as increased borrowing by Oracle whose debt to equity ratio is already 500% compared to 50% for Amazon, 30% for Microsoft and even less at Meta and Google. 

There is no way for Oracle to pay for this with cash flow. They must raise equity or debt to fund their ambitions. Until now, the AI infrastructure boom has been almost entirely self-funded by the cash flows of a select few hyperscalers. Oracle has broken the pattern. It is willing to leverage up to hundreds of billions to seize a share. The stable oligopoly is cracking…The implications are profound. Amazon, Microsoft and Google can no longer treat AI infrastructure as a discretionary investment. They must defend their turf. What had been a disciplined, cash-flow-funded race may now turn into a debt-fueled arms race. 

… and which has conjured out of thin air massive amounts of investment capital which as Jensen Huang was kind enough to admit to CNBC earlier today, actually does not even exist…

$NVDA New CEO JenSen Huang on CNBC Full🎙️

~@nvidia and @OpenAI partnership since 2016;
different than $AMD and OpenAI deal.

~OpenAI gonna have to raise funding to fund the Data centers, cited OpenAI revenue is growing very fast.

~ @xai & NVDA equity raise

~ Is this a Bubble… https://t.co/hflRvYdJpz pic.twitter.com/dkLTpEh8vM

— Mike (@MikeLongTerm) October 8, 2025

… but will at some point in the future, either in the form of future cash from operations, equity raises (don’t tell current investors) or debt. Well, really just debt. 

Lots and lots of debt, because with negligible enterprise penetration and the biggest use case so far being a $19.99 monthly subscription for lazy college students who are outsourcing their essay writing to some chatbot, someone has to pay for the $500 billion in annual capex.

That someone, we discussed in detail, will be a new generation of creditors. Some will be private creditors as we explained back in July in “The Shocking Math: Paying For AI Capex Will Require Over $1 Trillion In New Debt By 2028,” in which we quoted some stunning numbers from Morgan Stanley:

We forecast roughly $2.9 trillion of global data center spend through 2028, comprising $1.6 trillion on hardware (chips/servers) and $1.3 trillion on building data center infrastructure, including real estate, build costs, and maintenance.

This translates into investment needs of over $900 billion in 2028. For context, the total capex spending by all companies in the S&P 500 index combined was about $950 billion in 2024.

Such large potential spending has significant macro consequences as well. Our economists expect that investment spending related to data center  construction and power generation will add up to 40bp to US real GDP growth between 2025-26.

That’s the good news… which many will say is already largely priced in. The bad news, again, is who pays for all of this. And Morgan Stanley admitted as much:

By any measure, the capital requirements to support this level of investment are staggering, and mobilizing efficient and scalable capital  becomes increasingly critical. We did a deep dive into this topic, exploring alternative avenues of capital to finance this expenditure, in a collaborative report published a few days ago. The key takeaway from the report is that credit markets – secured, unsecured, and securitized in both public and private markets – will play a growing role in financing data centers.

To be clear, capex related to AI and data centers has been in motion for the last few years. Spending from the hyperscalers alone has gone from ~$125 billion two years ago to ~$200 billion in 2024 and the consensus expectation is that it exceeds $300 billion in 2025.

Internal operating cash flows from the hyperscalers have been the source of this spending. However, our equity analysts expect the investment needs for data centers to rise sharply over the next few years. While cash flows from hyperscalers will remain a key source of capital to  finance data center-related spending, these alone will no longer be adequate, after accounting for cash build and shareholder  capital returns. Leveraging our equity analysts’ projections, we estimate that $1.4 trillion of hyperscaler capex may be self-funded with cash flows, leaving a sizable $1.5 trillion financing gap.

We think that credit markets, broadly defined to encompass both public and private markets of different flavors, will gain traction as more efficient providers of capital to bridge this gap. There is a favorable alignment of significant and growing dry powder across credit markets with attractive real yields on offer with appeal to a sticky end-investor base (e.g., insurance, sovereign wealth funds, pension funds, endowments and high net worth retail) looking for scalable, high-quality asset exposures that can provide diversification benefits. We think that this alignment of needs of capital and investment will pave the way for bridging the $1.5 trillion financing gap.

We size the different financing channels as follows: unsecured corporate debt issuance from issuers in the technology sector (~$200 billion); securitized markets in the form of data center ABS and CMBS (~$150 billion), private credit markets in the form of asset-based financing (~$800 billion), and other capital sources across sovereign, private equity, venture capital, and bank lending (~$350 billion). Of these, we think that private capital – in particular credit – will play a key role in meeting a majority of the remaining financing gap as it sits optimally at the intersection of significant expansion in AUM in a higher rate environment and the complex, global, and customized financing needs that are associated with AI build-out. 

As MS concludes, “the point we want to drive home is that credit markets will play a major role in enabling AI-driven technology diffusion” and of all the available sources of credit, the chart below shows just how big the debt hole is that private credit will have to plug.

Two months later, a study by Bain came to virtually the same conclusion: 

Bain’s research suggests that building the data centers with the computing power needed to meet that anticipated demand would require about $500 billion of capital investment each year, a staggering sum that far exceeds any anticipated or imagined government subsidies. This suggests that the private sector would need to generate enough new revenue to fund the power upgrade. How much is that? Bain’s analysis of sustainable ratios of capex to revenue for cloud service providers suggests that $500 billion of annual capex corresponds to $2 trillion in annual revenue.

What could fund this $2 trillion every year? If companies shifted all of their on-premise IT budgets to cloud and also reinvested the savings anticipated from applying AI in sales, marketing, customer support, and R&D (estimated at about 20% of those budgets) into capital spending on new data centers, the amount would still fall $800 billion short of the revenue needed to fund the full investment.

And visually:

The problem, as we detailed last week, is that the private credit sector is starting to crack under the massive weight of its exposure to US consumers (where such notable implosions as the Tricolor and First Brands bankruptcies are just the beginning).

Luckily, there is also the public credit sector, and here we have a full-blown debt bubble brewing as well. And yes, it’s all tech related too. 

According to JPMorgan’s Eric Beinstein and Nate Rosenbaum (full note available here), AI-related companies now make up 14% of the Investment Grade Index with $1.2T in debt. Shockingly, this is now the largest sector within the IG index, exceeding Banks.

Further, the sector trades ~74bps which is 10bps tighter than the broader JULI index (these companies can be tracked on BBG via JPM’s Delta-One basket JPAMAIDE).

This is how Beinstein summarized the problem:

The torrid ascent of AI stocks has caused some angst for credit investors worried that any potential downside there could have credit implications. We think that from a fundamental perspective, these fears are not justified as these companies are either cash rich/not highly levered (Tech and Cap Goods) or highly regulated (Utilities). That said, an equity selloff in AI-related names would likely impact credit too, and, given these companies trade tight to the rest of the market, a short basket of single name CDS may be an effective tail-hedge for cross-asset investors.

In conjunction with JPM HG Credit Tech, Utilities and Cap Goods analysts, we have identified what we believe to be the current cohort of IG companies most closely tied to the AI revolution. The amount of debt tied to these companies has grown rapidly to $1.2tr currently. As such, AI companies as we define them now make up 14.0% of the IG index, which if thought of as a ‘sector’ is now larger than the largest HG sector (US Banks).

JPMorgan’s conclusion: “The market cap of the JPAMAIDE equity basket has grown to 39% of the market cap of the S&P500 so a repricing could be significant for broader markets“

At the single security level, AAPL, DUK, and ORCL are the largest bond issuers but are cash rich/net debt low types of companies. Of these, the last one is the most concerning because as JPM’s Cembalest wrote in “The Data Center Blob“, Oracle has a debt to equity ratio of 500% compared to 50% for Amazon, 30% for Microsoft and even less at Meta and Google. In other words, once the AI credit bubble bursts, Oracle will be the first to go.

There is a bigger problem: if and when the AI paradigm shifts, whether due to the market suddenly demanding tangible returns on AI investment and not just circle jerk funny money, or because China comes up with a 1000x cheaper AI chip than Nvidia, or reverse engineers a better LLM than anything the Sam Altman “non-profit” can push out, equity investors in the AI sector will suffer massive losses, but at least these will be large contained to the stock market. However, it is the AI credit, which is being used to pay for that $500 billion in annual capex and serves as the scaffolding of the broader economy, and which is “guaranteed” with future cash flows that will never come, that will be the true time bomb that wrecks the economy once the AI bubble bursts. 

Or maybe not. 

In its gloomy report (mentioned above), which calculated the massive funding shortfall facing the AI bubble and which virtually assures it will burst over time, the consultancy laid out a case in which the economics of AI might actually work:

Technological breakthroughs change the landscape. History is replete with unexpected leaps of progress in computational power. Sixty years of Moore’s law progress in semiconductors has given us handheld devices that far outperform the most powerful computers of the 1970s. Many speculate that quantum computing, for example, could displace the favored semiconductors trajectory of today, reducing the compute and power demands of tomorrow’s systems. Bain’s research suggests we are at least 10 to 15 years away from quantum computers stable enough to replace generative AI training and inference workloads. Other technological breakthroughs could include specially designed training and inference application-specific integrated circuits (ASICs), which could be more efficient than general purpose graphics processing units (GPUs), or new forms of memory or advanced packaging to improve power efficiency.

In other words, there is hope the AI bubble won’t burst and drag global markets and the economy with it, and that the AI sector will one day become self-sustaining. All we need, is a miracle.

More in the full JPMorgan notes here and here, available to pro subscribers.

Gazans and Israelis, on either side of the conflict, have been celebrating the Trump-brokered ceasefire as it (informally) went into effect for the first day. “A great day in the Middle East!” Trump writes on Truth Social. The Netanyahu government is still expected to formally approve it later in the day.

President Trump has been issuing thank you messages from his social media platform: “United States Ambassador Mike Huckabee is AMAZING! He worked so hard, and did so much, to bring about Peace in the Middle East. He has very quickly become a Great Man. Thank you Mike!” the president writes. He had upon first announcing the deal late Wednesday, “This means that ALL of the Hostages will be released very soon, and Israel will withdraw their Troops to an agreed upon line.”

Trump has further called the Gaza deal “a great day for the world,” saying, “The whole world has come together on this one, Israel, every country has come together. This has been a fantastic day…  a wonderful day for everybody.”

James Elder, spokesperson for Unicef in Gaza, says from on the ground he’s seeing “for the first time in a long time” a “sense of relief” from Palestinians. “There’s an immense amount of relief right now. You can’t overstate how Palestinians have been pushed to the edge physically and psychologically.” But amid the joy he added that “I’m also seeing emaciated children.”

All the remaining Israeli hostages as well as Palestinian prisoners are expected to be released within days according to the first phase agreement, though a precise timeline is as yet unknown.

As expected, there’s already some contention over logistics and details of the plan, which Hamas spokesman Hazem Qassem telling Al Jazeera Arabic that Israel has begun to “manipulate the dates, the lists, and some of the procedures and steps agreed upon in the ceasefire agreement.”

Euphoria erupts in Gaza, people pour onto the streets, singing and dancing as the long-awaited ceasefire is announced. pic.twitter.com/uKx3LIA639

— The Kashmiriyat (@TheKashmiriyat) October 9, 2025

“We are in contact with the mediators to oblige the occupation to comply with what was agreed upon, and not to allow it to procrastinate. There was talk with friends about a ceasefire at noon this day, but the occupation, for internal considerations, is postponing the announcement to other dates,” Qassem said.

There are still significant hurdles to go, and there has been evidence of some sporadic firing from IDF tanks…

🚨 BREAKING: Israeli tanks stationed along Al-Rashid Street fired shells directly toward civilians waiting to return to their homes in Gaza City. pic.twitter.com/U2n7GTKqL1

— TIMES OF GAZA (@Timesofgaza) October 9, 2025

For one, Hamas expects the IDF to retreat to the agreed upon withdrawal line before it releases the hostages. Also, Israel’s cabinet says it must formally approve the deal at a meeting tonight in order for it to formally take effect.

At this point, there’s still been no details as to how the disarmament of Hamas will happen, or what exactly the future governance of Gaza will look like, other than a US-run ‘board’ and Palestinian technocrats, presumably from the PA.

Meanwhile, the Nobel committee must be getting nervous…

Gazans join Israelis in chanting Trump’s name over cease-fire: ‘Nobel Prize to Trump!’ https://t.co/142AeugCCY pic.twitter.com/qSpMu1xuPM

— New York Post (@nypost) October 9, 2025

Though there’s been a downtick in fighting and shelling, Middle East Eye reports the following Thursday, “Smoke rises over northern Gaza as Israeli strikes continue, despite a ceasefire announcement on Wednesday. Both Israel and Hamas have agreed in principle, but the truce will not take effect until it is approved by the Israeli Knesset later today.”

Authored by Steve Watson via Modernity.news,

A Democratic Senator openly claimed Tuesday that the Trump Administration faked violent clashes between Antifa thugs and ICE officers in order to justify a federal surge.

Senator Jeff Merkley says that Trump “staged a fake riot” in order to invoke the Insurrection Act.

Merkley claims that peaceful protesters were marched three blocks and then confronted with “a line across the road, accompanied by “professional videographers.”

The Senator alleges that pepper balls, flashbangs sounding like gunfire, and tear gas were used, creating the appearance of a riot.

🚨UNHINGED: Dem Senator Jeff Merkley is now claiming the recent riots in Portland were “staged” to justify federal involvement.

“Totally fake!” pic.twitter.com/imsgaXFxFW

— Townhall.com (@townhallcom) October 8, 2025

The Senator alleges that pepper balls, flashbangs sounding like gunfire, and tear gas were used, creating the appearance of a riot.

To be clear, he is suggesting that the Antifa leftists themselves are ACTORS.

“Of course when you put teargas everybody moves,” Merkley said, adding “It looks as if there is some kind of riot going on.”

He charged that the exchange was “Totally fake,” asserting that “This was first time I know at least in my lifetime that federal government has faked A RIOT in order to try and justify if you will the insurrection act being invoked.”

Yeah, because Portland is really a peaceful utopia where leftist agitators never cause any trouble.

Well, Mr. Merkley should take his family down there tonight and livestream his visit to the Portland ICE facility. If it’s as safe as he claims, his wife and kids will be fine right? Especially if there’s no danger at all

— ScrollofTruth (@ScrollofTruthIF) October 8, 2025

It’s unclear exactly which exchange Merkley is referring to, but rioting and attacks on the ICE facility in Portland has been going on almost every night for months.

BREAKING: Tear gas and pepper balls deployed outside Portland ICE Detention Center, multiple arrests pic.twitter.com/6blDNw3ylf

— Oliya Scootercaster 🛴 (@ScooterCasterNY) October 4, 2025

Portland, OR. ICE. Tear gas was deployed several times. pic.twitter.com/Ahz4CAtUrn

— C.K. Bouferrache aka Honeybadgermom (@hunnybadgermom) September 2, 2025

🚨: Federal agents protecting ICE facility in Portland, Oregon use tear gas to repel anti-ICE crowd blocking the facility’s driveway.

Agents shot pepper balls at Antifa throwing tear gas canisters back and rushed into the crowd to make arrests.
pic.twitter.com/SWxIxDhvMx

— Julio Rosas (@Julio_Rosas11) October 4, 2025

Portland (July 4) — Shocking scenes outside the ICE facility as federal officers protecting the building use tear gas after Antifa rioters tried setting the occupied building on fire again. pic.twitter.com/UCJfk41X1f

— Andy Ngo (@MrAndyNgo) July 5, 2025

Breaking — Federal police declare an unlawful assembly at the ICE facility in Portland.

Several arrests made as officers deploy endless tear gas, crowd control munitions to disperse crowd. pic.twitter.com/JWBpBalEoV

— Katie Daviscourt 📸 (@KatieDaviscourt) July 5, 2025

Half the criminal DemoParty is saying riots in Portland are not happening, while the other half is saying the riots that are happening are a setup.

I would expect nothing less of the criminal DemoParty and their supporters who will literally believe ANYTHING they are told to…

— Truthis… (@PostPattonUS) October 8, 2025

The secret plan to destroy the Democrat party called “Let Them Speak” is underway and working beautifully.

— Mike Schultz (@schult70031) October 8, 2025

Merkley’s demented remarks come in the wake of Illinois Governor JB Pritzker suggesting that Trump is deploying the National Guard to cities as part of a grand scheme to end elections in the U.S.

*  *  *

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US equity futures are flat, as the main indexes closed at fresh record highs overnight amid a melt-up that shows no signs of abating, with every small dip being bought and volatility staying low. While plenty of investors have doubts about the AI-driven rally and the tense geopolitical backdrop, the year-end FOMO is the only driver for now. As of 8:30am, S&P futures are flat, while Nasdaq futures trade fractionally in the red, although we are confident the dip-buying algos will promptly pounce on the opportunity. In premarket trading, Delta Air Lines climbed more than 5% after reporting profits that beat estimates. PepsiCo gained on stronger-than-expected revenue and flagged a turnaround at its US beverage unit. Nvidia rose after the US approved several billion dollars worth of its chip exports to the United Arab Emirates. Shares of other Mag 7 names were mixed. Bond yields are higher by 1-2bp across the curve ahead of today’s 30Y auction, with USD flat following a 1.2% move WTD. Ahead of Trump / Xi meeting later this month China expanded its rare earths curbs. In commodities, Energy is mixed with distillates higher and crude/natgas lower. Oil slipped and gold stalled near a record high above $4,000 as traders focused on cooling tensions in the Middle East; Silver topped $50 for the first time and PGMs are stronger. Today’s session has seven Fed speakers and a 30Y bond auction; yesterday’s 10Y auction required a concession. Macro data is delayed again due to the government shutdown.

In premarket trading, Mag 7 stocks are mixed (Microsoft little changed, Alphabet -0.2%, Meta little changed, Apple -0.1%, Amazon -0.2%)

• Tesla (TSLA) falls 1.1% as US auto safety regulators opened a probe into the company over incidents in which its vehicles ran through red lights and violated other traffic laws while using the driver-assistance system known as Full Self-Driving.
• Nvidia (NVDA) rises 1.7% after the US approved several billion dollars worth of Nvidia chip exports to the UAE, an initial step in implementing a controversial deal that could serve as a blueprint for American AI statecraft. Separately Cantor Fitzgerald raised its price target to a Street-high, seeing more growth potential for the chipmaker on the back of AI-related growth.
• Rare earth stocks climb after China unveiled new restrictions on exports ahead of a meeting this month between Donald Trump and Xi Jinping.
• Akero Therapeutics (AKRO) jumps 18% after Novo Nordisk agreed to buy the drug developer for $54 per share in cash at closing, with a contingent value right of $6 per share
• Apogee Therapeutics (APGE) is down 6% after the company offered shares.
• AZZ Inc. (AZZ) falls 7% after the provider of metal-finishing services reported second-quarter sales that missed estimates.
• Costco (COST) is up 1% after the warehouse club reported comparable sales growth that beat analyst estimates for September, helped by a rise in both foot traffic and amount spent per customer.
• Delta Air (DAL) climbs 6% after the carrier updated its adjusted earnings per share forecast for the full year, with the new guidance beating the average analyst estimate.

In corporate news, Warner Music Group is said to be close to an agreement with Netflix to create a slate of movies and documentaries based on the label’s artists and songs. Jefferies has come under scrutiny for its relationship with First Brands.

As we said yesterday, and the day before, and the day before that, and so on, stocks around the world have soared to a fresh record as traders looked past worries of a potential bubble in high-profile tech names and instead focused on corporate resilience and the possibility of further US interest-rate cuts. The optimism now faces another test as earnings season gets underway, with Wall Street banks Goldman Sachs and Citigroup due to report next week. Tesla is the first of the Magnificent Seven set to report on Oct. 22, followed by Alphabet, Microsoft and Meta Platforms Inc. on October 29.

“A liquidity glut and the AI boom keep the party going for equities,” said Barclays strategist Emmanuel Cau. Still, the reluctant bulls driving the rally have plenty of lingering worries, such as Nassim Taleb’s warning that investors should insure against a stock-market crash due to structural issues such as the US debt burden.

“Given how lopsided the expectations have become, given how lofty the valuations have become, I think investors are laser focused on earnings,” Aidan Yao, a strategist at Amundi Investment Institute, said on Bloomberg TV. “They are trying to see if earnings are really catching up into the valuations.”

Elsewhere, the Fed minutes revealed that many members have expressed caution — driven by concerns over percolating US inflation. And traders have been slowly backing away from bets on the trajectory of rate cuts. Gold is taking a breather from its record run, while silver just topped $50 for the first time

In geopolitical news, Trump said Israel and Hamas have signed off on the first phase of a peace plan. A ceasefire in Gaza has gone into effect, Israel Deputy Foreign Affairs Minister Sharren Haskel said subsequently. If the agreement holds, it would mark a major step toward ending the conflict that erupted after Hamas attacked Israel on Oct. 7, 2023 and threw the Middle East region into crisis. Canadian PM Mark Carney pushed back against Trump’s protectionism in the auto industry, saying that the US-Mexico-Canada Agreement strengthens the US industry. China unveiled broad new curbs on its rare earth exports.

European stocks are mixed. The CAC 40 adds 0.3% while the DAX climbs to a fresh record. The FTSE 100 falls 0.4% as HSBC shares slump after the bank proposed taking its Hong Kong subsidiary private. Here are some of the biggest European movers today:

• HelloFresh shares surge as much as 11% as UBS upgrades to buy from neutral and says the firm offers a “compelling risk-reward”
• Sodexo shares advance as much as 3.5% after the food services company announced that Sophie Bellon will step down as CEO
• Suedzucker shares rise as much as 1.8% after analysts at Warburg said the drop in earnings during the first half is not a major surprise
• Volution shares rise as much as 10%, hitting an all-time high, after the firm delivered annual results that were ahead of expectations
• MTG shares gain as much as 11% after it updated its full-year 2025 guidance and announced a SEK400 million share buyback program
• Mobilezone shares rally as much as 12% after agreeing to sell its German business to Freenet
• Polar Capital shares rise as much as 5.9% as assets under management grow 15% in the three months to the end of September
• Emmi shares gain as much as 4.8% as Oddo BHF starts coverage of the Swiss dairy producer with an outperform recommendation
• Lloyds Banking Group shares drop as much as 3.9% after the lender said it will likely have to set aside an additional provision to compensate customers who were missold car loans
• Michelin shares drop as much as 6.5% following a pre-close call ahead of its 3Q sales update scheduled for Oct. 22
• Gerresheimer shares drop as much as 14% after the company cut its outlook for the year yet again
• Sopra Steria shares fall as much as 5.6% after its CEO Cyril Malargé decided to step down

Earlier in the session, Asian stocks rose, as an AI-fueled tech rally resumed following a brief pause and shares in mainland China gained as the market reopened after the Golden Week holidays. The MSCI Asia Pacific Index rose as much as 0.6%, poised for its first gain in three sessions. A sub-gauge of tech shares was the top performer among sectors, rebounding from Wednesday’s declines. It had risen for seven straight days before that. TSMC was the biggest boost to the MSCI Asia measure after a US index of chip stocks jumped to a fresh all-time high on AI euphoria. China’s CSI 300 Index advanced 1.5% to its highest since January 2022 as investors got up to speed on headlines from OpenAI deals to gold’s climb above $4,000. Benchmarks in Japan and Taiwan climbed to fresh records.

In FX, the Bloomberg Dollar Spot Index is flat, in early London trade it pushed up to its highest level since Aug. 5. EUR/USD was slighly lower at 1.1623; its selloff has slowed as French President Emmanuel Macron is set to name a new prime minister by Friday evening, avoiding the need to call a snap election for the time being. USD/JPY steadies around an eight-month high of 153.22; investors contemplate how much the Japanese currency must weaken before authorities intervene again

In rates, treasury yields are within a basis point of Wednesday’s closing levels following similarly rangebound price action in core European bonds. Focal points of US session include 30-year bond reopening, last of three coupon auctions this week. Fed Chair Powell delivers pre-recorded welcoming remarks at its community bank conference at 8:30am New York time, with text release expected. US 10-year, little changed near 4.12%, trades marginally cheaper vs German and UK counterparts; curve spreads are marginally flatter on the day. $22 billion 30-year bond reopening at 1pm New York time follows Wednesday’s middling 10-year note auction, which tailed by 0.8bp. WI 30-year yield near 4.7% is ~5bp cheaper than last month’s, which stopped on the screws.

The Bloomberg Dollar Spot Index . Spot gold loses a few dollars but remains firmly above $4,000/oz.

In commodities, oil slipped and gold stalled near a record high above $4,000 as traders focused on cooling tensions in the Middle East. Israeli markets staged a broad rally, sending the shekel to a three-year high. The Tel Aviv Stock Exchange 35 Index added 1.7%, notching a fresh all-time high, while bond yields fell across the board.  WTI crude futures fall 0.2% to $62.40 a barrel. Bitcoin falls 1%.

Looking at today’s calendar, wholesale trade/inventories for August are scheduled for 10 am ET, but govt. data releases are likely to be impacted by the shutdown. Fed’s Bowman, Goolsbee, Barr, Kashkari and Daly are scheduled to speak and Fed Chair Powell gives pre-recorded remarks at Fed community bank conference. 

Market Snapshot

• S&P 500 mini little changed
• Nasdaq 100 mini little changed
• Russell 2000 mini -0.3%
• Stoxx Europe 600 -0.2%
• DAX +0.3%
• CAC 40 +0.2%
• 10-year Treasury yield +1 basis point at 4.13%
• VIX +0.1 points at 16.41
• Bloomberg Dollar Index little changed at 1210.88
• euro little changed at $1.1619
• WTI crude +0.3% at $62.72/barrel

Top Overnight News

• Israel and Hamas agreed on terms for the exchange of all hostages held in Gaza for about 2,000 jailed Palestinians. Donald Trump told Fox he expects the hostages to be released “probably” on Monday. A Gaza ceasefire is in effect, Israel’s deputy foreign affairs minister said. A Gaza ceasefire is in effect, Israel’s deputy foreign affairs minister said.  BBG
• President Trump said most workers will get back pay and noted they want to make Obamacare better, while he stated that military personnel will probably be paid during the shutdown. Furthermore, it was separately reported that White House officials said President Trump is mulling shifting funds to pay troops: POLITICO.
• Democratic bill to end US government shutdown failed to win enough votes to pass in the Senate, while the Republican bill to end the US government shutdown also failed to win enough votes to pass in the Senate.
• US House Minority Leader Jeffries said he supports an effort to pass a standalone bill to pay military troops.
• US IRS is to furlough 34k employees as part of the government shutdown.
• Bessent wrapped up Fed chair interviews on Tuesday and while Hassett, Warsh, and Waller are still frontrunners, BlackRock’s Rick Rieder performed “very well.” FT
• China tightened its control over rare earths/ sectors crucial to making high-tech products including electric vehicles and jet fighters, threatening to reignite trade tensions with the U.S. ahead of an expected meeting between President Trump and Chinese leader Xi Jinping. WSJ
• China’s commerce ministry on Thursday added 14 foreign organizations to its “unreliable entity list”, it said in a statement, restricting their ability to carry out commercial activities within the world’s second-largest economy. Some of the companies, which are mostly based in the United States, had supplied anti-drone technologies to Taiwan. Politico
• China is using the rally in gold to reduce reliance on US-led financial systems and challenge dollar dominance. Beijing has been accumulating gold reserves for a decade and is now seeking to woo other nations to store gold in China’s bonded warehouses and trade the metal on the Shanghai Gold Exchange. BBG
• Nato allies are discussing a more forceful response to Putin’s increasingly provocative actions, including by deploying armed drones along the border with Russia and easing restrictions on pilots to allow them to open on Russian aircraft. FT
• TSMC reported a better-than-expected 30% increase in its third-quarter sales. BBG
• The US has approved several billion dollars worth of Nvidia Corp. chip exports to the United Arab Emirates, an initial step in implementing a controversial deal that could serve as a blueprint for American AI statecraft. BBG
• NY Fed President John Williams said he supports further rate cuts this year, citing labor market concerns, the NYT reported. He added that he doesn’t think the US is on the verge of a recession. BBG
• Fed’s Williams supports further rate cuts; does not think the US economy is on the verge of a recession: NYT. 

Trade/Tariffs

• US President Trump’s administration is reportedly planning to exclude generics from the big pharma tariff plan, although the decision isn’t final and could change, according to WSJ.
• Canadian PM Carney said there will be some bilateral deals alongside the USMCA
• China’s government announced export controls on rare earth materials with MOFCOM stating that foreign firms and individuals must obtain a dual-use items export license regarding rare earth exports, while domestic exporters exporting some dual-use items shall declare the final destination country or region as required, with requirements taking effect from December 1st. Furthermore, it stated that exports of items for design, development, production or use of weapons of mass destruction will not be approved and export applications to overseas military users, as well as to importers and end-users on watch lists, shall not be approved in principle.
• Vietnam said negotiators are to travel to the US in October and November to continue trade talks.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks were predominantly higher following the tech rebound stateside, where the S&P 500 and NDX notched fresh record levels, while participants were encouraged by an agreement on the first phase of a Gaza ceasefire deal, and with Chinese traders returning from the National Day Golden Week holiday. ASX 200 eked mild gains with strength in mining and materials, while tech and the top-weighted financial industry lagged. Nikkei 225 resumed its recent rally with the ascent spearheaded by tech advances following the strength in US counterparts. Hang Seng and Shanghai Comp were somewhat mixed as the Hong Kong benchmark took a backseat to the Mainland Chinese markets, which reopened for the first time this month, while there were also divergences between some banks as Hang Seng Bank was the biggest gainer after jumping more than 26% and with HSBC in the red after proposing to take the former private.

Top Asian News

• Former BoJ Deputy Governor Wakatabe said the BoJ can raise interest rates if inflation expectations heighten and push up underlying inflation, but added the BoJ will likely find it hard to justify raising rates this year due to prospects of weak Q3 GDP. Furthermore, he said the BoJ has not committed to a set timing for raising rates and has not dropped any signals, while he stated the BoJ must coordinate policy with the government, but does not need to keep rates low solely to fund government spending.
• Chinese Commerce Ministry announces export control on some rare earth equipment materials; adds new rare earth elements to list. Announces additional export control on items related to Lithium batteries and Artificial Graphite anode materials. Export control on items related to super hard materials. Export control on some medium and heavy rare earth-related items. List includes rare earth materials and machinery for export control.
• Adviser to Japan’s new LPD leader Takaichi, Honda, says the BoJ should be cautious about raising interest rates; unclear when the next rate hike would be, but Takaichi is likely to be cautious. USD/JPY is unlikely to rise above 155 as inflation expectations remain cautious. Weak JPY is positive for the economy when in the recovery phase.

European bourses (STOXX 600 -0.2%) opened mostly on a firmer footing, but sentiment has slipped a touch to display a bit more of a mixed picture in Europe. European sectors are mixed. Telecoms and Basic Resources takes the top spot, with the latter boosted by a few broker upgrades from within the sector alongside strength in underlying metals prices. Banks are found towards the foot of the pile, with losses in HSBC (-6.4%) driving the sector lower after it proposed to privatise Hang Seng Bank. Elsewhere, Lloyds (-2.9%) dips after the Co. warned of a “material” hit related to the FCA’s latest motor finance ruling.

Top European News

• German coalition agrees to EUR 3bln in EV incentives through 2029, Chancellor Merz adds that they are aiming for an accord on the combustion ban by Thursday.
• Jean-Louis Borloo has come to the attention of Politico as a potential candidate for French PM Politico writes “Jean-Louis Borloo could fit the composite portrait drawn up overnight by a Macronist strategist: he could “speak to the left,” “embody a depresidentialized government,” and be “not as openly a lieutenant of Emmanuel Macron” as Sébastien Lecornu. Put more trivially by an advisor who got wind of the idea: “He won’t go and ask the PR for permission to pee.””
• BoE’s Mann says “the risks to the outlook for the UK economy are two-fold. Inflation remains persistently persistent and the outlook for growth remains modest”. “This assessment of risks to consumption is set against a background of persistently high inflation, and drifting household inflation expectations. Neither are target-consistent”. “For the first theme, inflation and consumer scarring, the research shows that the rapid increase in the price level has scarred consumers, even as inflation has moderated and real income growth resumed”.

FX

• A fourth session of gains for the broader USD and index, this time with a lending hand from GBP weakness (more below), as well as ongoing losses in the NZD following the 50bps jumbo rate cut delivered by the RBNZ yesterday. The macro narrative surrounding the US remains a downbeat one as the government shutdown continues to drag on, delaying economic data releases and threatening a hit to domestic growth, with today’s weekly Jobless Claims also shelved for now. DXY prints on either side of 99.00 and eclipsed Wednesday’s peak (99.06).
• EUR/USD is subdued but to a lesser extent than some peers, with some degree of certainty arising on the French political front, with news that French President Macron will name a new PM in the next 48 hours and said there is a possible path to a budget by December 31st. Polymarket odds point to a 32% chance of a French election being called by the end of the month, vs a c. 70% probability yesterday morning, according to ING. On the data front, Germany printed a larger trade surplus than expected, although imports and exports contracted. This follows a string of woeful German data, with German Industrial Output and Industrial Orders this week falling well short of consensus. Focus now turns to the ECB Minutes later.
• USD/JPY tilts higher amid Dollar strength and following rangebound APAC trade amid a pause from the recent Takaichi-related advances, with her economic measures and PM nomination said to likely be delayed. USD/JPY has climbed as high as 153.22, with focus now on whether the pair begins to approach 155.
• GBP is among the laggards, despite limited newsflow before comments from BoE’s Mann. Initial losses were seemingly driven by technicals as GBP/EUR fell under 1.1500. BoE’s Mann stuck to her stance, arguing that “policy needed to remain restrictive for longer, both to squeeze out inflation persistence”. Little reaction was seen on the comments.
• Antipodeans are subdued with little notable influence from China’s return from the National Day Golden Week holiday, whilst the Kiwi underperformed and is still feeling the hangover from the RBNZ on Wednesday.

Fixed Income

• A contained start to the day for USTs. Newsflow has been light aside from last night’s FOMC Minutes being digested and the ongoing geopolitical situation around Hamas – see the feed for analysis. The above aside, the US docket is once again devoid of data owing to the shutdown, which still continues with no end in sight. As such, the main focal point is the heavy speakers docket headline by Chair Powell; from Powell, we do expect a text release, though this will be pre-recorded welcoming remarks, no Q&A expected. Texts also due from Bowman (voter), Goolsbee (2025), Barr (voter). As it stands, USTs are in a very narrow 112-18 to 112-24+ band and entirely within Wednesday’s 112-17 to 112-27 confines.
• OATs are awaiting the announcement from President Macron on who the next PM will be, an update on this is expected by the end of Friday but there is no specific time for this yet. Politico reports that Jean-Louis Borloo has come to their attention as a potential candidate for French PM, as he can “speak to the left,” “embody a depresidentialized government,” and be “not as openly a lieutenant of Emmanuel Macron”, Politico surmises. Ahead of this, OATs are outperforming peers with gains of c. 20 ticks at most. Upside that appears to be a function of the diminished odds of legislative elections in the near term and signs of some cooperation between parties. Given this, the OAT-Bund 10yr yield spread is holding just beneath 83bps, vs the 88.2bps seen in recent sessions.
• Drifting throughout the European morning. Down to a 128.79 low with downside of c. 12 ticks at most. While marginally underperforming its peers, the benchmark remains clear of Wednesday’s 128.49 base. Pressure potentially a function of the updates on Germany’s automobile situation. As the nation has agreed on EUR 3bln worth of EV incentives, an agreement that comes ahead of a meeting at 14:00BST on the subject. While we don’t yet know how the incentives will be financed, the prospect of additional issuance is potentially weighing on the space.
• Gilts opened lower by 13 ticks before slipping one more to a 90.65 trough, a point that the benchmark has remained around since. UK-specific newsflow light. No move to a text release from BoE’s Mann that stuck to her known hawkish bias. Overall, the complex is under modest pressure but is broadly in-fitting with EGB peers as we await a fresh catalyst.

Commodities

• Crude benchmarks trade rangebound as the European session got underway, as Hamas and Israel agreed to the first part of the Gaza ceasefire. Despite today being the day of the ceasefire, Israel continues to raid the Gaza Strip; sources citing Netanyahu’s office said, “the ceasefire will come into effect only after the government approves it”, according to Al Jazeera. The Israeli cabinet is to meet at 15:00 BST. Though most recently Bloomberg reported, citing the Israeli Deputy Foreign Minister that the ceasefire is in effect.
• Spot XAU is taking a breather this morning as the yellow metal formed a new ATH at USD 4059/oz in yesterday’s session. The metal fell down to USD 4k/oz during the APAC session as the Gaza ceasefire eased geopolitical tensions and dollar strengthening following the hawkish Fed minutes.
• Base metals extend higher as Chinese markets re-open following a week-long holiday. 3M LME Copper dipped to a low of USD 10.59k/t before reversing c. USD 280/t higher as China announced export controls on rare earth materials. Within the announcement, foreign firms and individuals must obtain a dual use items export licence to export rare earth materials. This is to come into effect on December 1st.
• Britain’s energy grid operators are confident of sufficient electricity and gas supply this winter, while peak British day gas demand is seen at 182 MCM this winter vs. peak supply of 565 MCM.

Geopolitics: Middle East

• Kann News, on the Israel-Hamas deal in the Israeli government, states that a clear majority in the government is expected. National Security Minister Ben-Gvir and Finance Minister Smotrich are expected to vote against – but not to resign.
• “Channel 12 quoted sources in Netanyahu’s office: The ceasefire will come into effect only after the government approves it”, according to Al Jazeera.
• Israeli security cabinet and government meeting on agreement delayed to 17:00 local time (15:00BST), according to Reuters citing sources.
• “Israeli Raid on Gaza Strip”, according to Sky News Arabia.
• Gaza ceasefire agreement goes into effect, via Al Qahera.
• Israeli PM Netanyahu’s office confirms that PM Netanyahu will convene the government on Thursday to approve the Gaza agreement, while an Israeli government spokesperson said they expect hostages to start being released on Saturday. Furthermore, Yedioth Ahronoth quoted Israeli officials stating that the Gaza agreement will be signed on Thursday and the first release will be either Saturday or Sunday, while it was later reported that the ceasefire will come into effect today at 12:00 noon (10:00BST/05:00EDT).
• Hamas said an agreement was reached to end the Gaza war, secure an Israeli withdrawal and for a hostage-prisoner swap, while it called on US President Trump and guarantor states to ensure Israel implements the Gaza ceasefire deal.
• Qatar Foreign Ministry spokesperson noted that mediators said an agreement was reached on all terms of the first phase of the Gaza ceasefire, while the Gaza ceasefire is to include an end of the war, the release of Israeli hostages and Palestinian prisoners, as well as entry of aid. Furthermore, the spokesperson said the details of the Gaza ceasefire agreement are to be announced later.
• US President Trump previously said he may go to the Middle East by the end of the week, maybe on Sunday, while he separately commented that he will most likely be going to Egypt. It was also reported that the White House said President Trump will get a routine yearly check-up on Friday and is considering going to the Middle East shortly thereafter.
• US Special Envoy Witkoff and White House Kushner is to travel to Israel on Thursday night, via Israeli Media.
• US President Trump announced that Israel and Hamas have both signed off on the first phase of the peace plan which means that all of the hostages will be released very soon, and Israel will withdraw their troops to an agreed upon line as the first steps towards a strong, durable, and everlasting peace. Trump also said he believes Iran will be part of the peace situation and that he spoke with Israeli PM Netanyahu, while he thinks Gaza will be rebuilt and that hostages will probably be released on Monday. In relevant news, Trump told Axios’s Ravid in a phone call that he is likely going to Israel in the coming days and would possibly speak in front of the Knesset, which he will definitely do if they want him to.

Geopolitics: Other

• Taiwan Defence Ministry report stated that China is using hybrid warfare to weaken people’s trust in the government and support for defence spending, while it added that China is increasing its grey zone attacks and frequency of military activities. Furthermore, it stated that China has been using AI tools to scan weak points in Taiwan’s critical infrastructure and steal and analyse intelligence, as well as noted that China is using botnet cyber-attacks with AI to weaken Taiwan’s digital infrastructure and cybersecurity.
• UN is to slash a quarter of peacekeepers globally due to lack of funding, according to a senior UN official.
• Ukraine President Zelenskiy says Russian forces aim to urgently capture eastern city of Pokrovsk, Ukrainian strikes against Russia may lead to gasoline shortages of up to 20%, US and Russia ‘have no shared perspective’ on war.
• Kremlin spokesperson Peskov says the dialogue between Russia and the USA have been put on a “serious pause”, via CGTN Europe.

US Event Calendar

• 8:30 am: Oct 4 Initial Jobless Claims, est. 228k: DELAYED
• 8:30 am: Sep 27 Continuing Claims, est. 1930k: DELAYED
• 10:00 am: Aug F Wholesale Inventories MoM, est. -0.2%, prior -0.2%: DELAYED

Central Banks (All Times ET):

• 8:35 am: Fed’s Bowman Delivers Welcoming Remarks
• 9:00 am: Fed’s Goolsbee Appears in Podcast
• 12:45 pm: Fed’s Barr Speaks on Economic Outlook
• 1:00 pm: Fed’s Kashkari and Barr Speak in Conversation
• 3:45 pm: Fed’s Bowman Delivers Speech on Community Banking
• 9:40 pm: Fed’s Daly at the Silicon Valley Directors Exchange

DB’s Jim Reid concludes the overnight wrap

Markets recovered their poise yesterday, with global equities at new highs as investors remained unfazed by the ongoing political uncertainty in various countries. So the S&P 500 (+0.58%) and the NASDAQ (+1.12%) both hit an all-time high, despite the government shutdown. And over in Europe there was an even stronger performance, even before news that President Macron has avoided a snap election for now by promising to name a new prime minister by the end of the week. Moreover, this rally was clear across multiple asset classes, with global bonds rallying on both sides of the Atlantic, oil prices picking up again, and gold prices (+1.44%) at another record of $4,042/oz.

 In terms of those political various stories, last night was the deadline given to France’s outgoing PM Lecornu to seek a way through the impasse. In the end President Macron’s office announced that he would but forward a new Prime Minister by Friday evening. This puts off the risk of snap elections for the time being. Investors were fairly optimistic during the trading session, as the outgoing PM Lecornu continued to insist a path forward was possible and that the deficit target for 2026 should be below 5% of GDP. And in turn, that led to a positive market reaction, with the Franco-German 10yr spread (-2.4bps) falling back to 83.5bps, whilst the CAC 40 (+1.07%) was the best performer among the major European indices. The attention now will shift to whether this new PM can form a cabinet, or whether Macron will eventually have to call for parliamentary elections. Polymarket has the implied probability of another election by year-end down to 51% overnight from nearly 80% earlier yesterday.  

Over in the US, the focus remained on the government shutdown, amidst mounting speculation that it might even drag on to next month. That came as Republicans and Democrats showed no sign of publicly shifting their positions, with Democratic Senate Minority Leader Chuck Schumer saying that their position on healthcare subsidies remained the same. Republican Senate majority leader Thune said that the Senate Republicans are prepared to bring individual appropriations bills forward in order to reopen the government department by department in what would be a long process. Speaker Johnson has not been receptive to this idea however, according to reporting from Axios. Nevertheless, US equities continued their historic pattern of shrugging off the effects, and both the S&P 500 (+0.58%) and the NASDAQ (+1.12%) moved up to new records. And once again, that was driven by tech and semiconductor companies. The Philadelphia Semiconductor Index (+3.98%) was up to a new record of its own led by AMD (+11.4%) which continues to rise after the OpenAI headlines from earlier this week.

Rate markets had a busy afternoon in the US with the Fed minutes and a 10yr auction within an hour of each other. The minutes showed that most FOMC members at the September meeting “judged that it likely would be appropriate to ease policy further over the remainder of this year.” This aligns with the dot plot as well as recent fedspeak. There was clearly a level of caution throughout the minutes as “Participants generally assessed that recent readings of these indicators did not show a sharp deterioration in labor market conditions.” However, on inflation, the majority of members emphasised upside risks. 10yr yields were nearly flat on the day before the minutes and then closed -0.7bps lower at 4.117%. 10yr yields had been stronger earlier in the session but were potentially weighed down by a late auction concession ahead of a $39bn 10yr note sale an hour before the Fed minutes. The auction metrics were solid with decent demand even as the primary dealer award ticked up from last month’s record low. Today we’ll get another test of duration demand with a $22bn 30yr auction.

Meanwhile, the spotlight on gold continued after spot prices (+1.43%) closed above $4000 for the first time. A lot of the investor moves towards gold have been led by both official central bank and ETF demand as the US government shutdown continues. In fact, total holdings of gold ETFs have already seen their highest point since September 2022, back when we had surging inflation globally and the Fed were hiking by 75bps per meeting to get it under control again. This flow into gold and other alternatives like Bitcoin (also up +0.73%) is something to keep an eye on, although yesterday we also saw the dollar index (+0.34%) hit a two-month high.

Back in the rest of Europe, equities also posted a strong advance, with the STOXX 600 (+0.79%), the FTSE 100 (+0.69%) and the DAX (+0.87%) all rising to fresh records. We did get a bit of data, including from the UK’s ONS, who announced that it had revised down the government’s borrowing for the current fiscal year by £2bn, leaving the budget deficit at £17.7bn in August. Nevertheless, gilts still underperformed, with the 10yr yield only down -1.0bps, compared to larger falls for 10yr bunds (-3.1bps), OATs (-5.5bps) and BTPs (-6.0bps).

In terms of data yesterday, we did get some small misses on Swedish headline CPI inflation (+0.9% y/y vs 1.0% y/y expected) and CPIF ex-energy (2.7% y/y vs 2.8% y/y expected) relative to consensus for September, but they were firmly in line with the Riksbank’s fresh forecasts, and are unlikely to change the central bank’s mind from holding rates for now. Today in Europe, we’ll also get the ECB’s account of their September decision, and several speakers including ECB President Lagarde and BoE Governor Bailey.

Asian equity markets are largely reflecting the overnight gains observed on Wall Street, primarily driven by increases in technology shares, as ongoing optimism regarding AI has spurred investment in chipmaking and related sectors. Throughout the region, mainland Chinese markets are leading the way, rebounding after a week-long holiday, with the CSI index rising by (+1.61%) and the Shanghai Composite index also experiencing a significant increase of (+1.24%). In Japan, markets have continued their upward trend, with the Nikkei index climbing (+1.40%) and the Topix index increasing by (+0.24%), both approaching record high closing levels due to gains in the technology sector. South Korean markets are closed for a holiday, while the S&P/ASX 200 index in Australia is seeing slight gains (+0.11%) with the Hang Seng moving back to flat after experiencing a decline of as much as -1.0% earlier pressurised by losses in health tech and healthcare stocks following a report from the Wall Street Journal indicating that tech giant Microsoft intends to make significant investments in AI-driven healthcare. US equity futures are flat.  

To the day ahead, and data includes Germany’s August trade balance. Central bank speakers include the Fed’s Kashkari and Barr, the ECB’s Villeroy, and the BoE’s Mann, and we’ll also get the ECB’s account of their September decision. Earnings include Delta Air Lines and Pepsi. Lastly, there’s the US 30yr bond auction.

The last few months have seen gold soar to record highs above $4,000 amid the so-called “debasement trade,” with investors flocking to the perceived safety of alternates while pulling away from major currencies.

It’s a monetary regime change – if market participants are trading anything it’s getting rid of a fiat currency (“it’s the denominator, stupid”) for a store of value – and we’re seeing it in spades with Bitcoin and gold:

However, quietly on the side, silver has been outperforming gold…

Source: Bloomberg

Citadel’s Ken Griffin said investors are starting to view gold as a safer asset than the dollar, a development that’s “really concerning” to the billionaire investor. 

“The conversation around debasement, irrespective of its realities, has ignited investors enthusiasm towards gold and silver to the point where regression analysis gives way to something more akin to how investors view AI or the technology sector,” said Kieron Hodgson, commodity analyst at Peel Hunt Ltd.

And now that is spreading to bitcoin and silver as the white metal topped $50 this morning…

Silver’s surge takes it back to the highs from 1980…

…when the Hunt brothers, Texan oil billionaires and notorious speculators, whose fear of inflation and belief in the metal as a store of wealth prompted them to try to corner the global market. They stockpiled more than 200 million ounces, driving the price above $50 an ounce before it crashed below $11.

Notably, silver in yen really snapped higher this morning…

With a break in the relationship as silver topped $50 – Something’s going on there… Were silver shorts being funded with Yen shorts? It appears that forced closing of silver shorts led to forced closing of yen shorts?

The white metal is used around the world as an investment asset, but also has industrial applications including in solar panels and wind turbines, which collectively account for more than half of the silver sold. Demand is set to exceed supply for the fifth consecutive year in 2025.

“I think the deficits are the slow burn,” said Philip Newman, director of consultancy Metals Focus Ltd.

“Just the size of the deficits have been so remarkable, and it takes time for that to manifest itself in the price.”

Additionally, Bloomberg reports that the silver market in London has tightened to an almost unprecedented degree, with sky-high borrowing costs for the metal.

This year, fears that the US could levy tariffs on silver have spurred a dash to ship the metal to the US, drawing down inventories in London and reducing the amount of material available to borrow.

Much of the stock of silver in London is held in vaults backing exchange-traded funds, and not available to buy or borrow on the market.

“I think when you look at above-ground stocks of silver in London you are looking at an increasingly small share, which is not allocated against ETFs,” Newman said.

As we detailed earlier in the week, it appears the so-called “debasement trade” – driving investors to bet more on gold, silver, and bitcoin – is set to continue with Gold remaining Goldman Sachs’ highest-conviction long commodity recommendation because of the:

a. Additional price upside in our base case (driven by structurally higher central bank gold demand)

b. Large upside risks to our price forecast from potential additional private sector diversification

c. Attractive portfolio hedging properties in downside (tail) scenarios that .are less favorable for equity-bond portfolios than our base case (e.g. global growth slowdown, rising market concerns about DM macro policy)

This price hike is likely to trigger more fears from Citadel’s Griffin who warned, during and interview with Bloomberg’s Francine Lacqua, that “we’re seeing substantial asset inflation away from the dollar as people are looking for ways to effectively de-dollarize, or de-risk their portfolios vis-a-vis US sovereign risk.”

Update (0840ET):

Let’s recap what unfolded during Wednesday afternoon’s Antifa roundtable at the White House, hosted by President Trump.

Several journalists shared firsthand accounts of being attacked by Antifa activists, but the real fireworks came from Seamus Bruner, Director of Research at the Government Accountability Institute, who briefed the president and his cabinet on a complex network of dark-money NGOs and activist groups fueling unrest nationwide via the permanent protest-industrial complex. 

“We have identified dozens of radical organizations, not just the decentralized Antifa organizations, but dozens of radical organizations that have received more than $100 million from the Riot Inc investors,” Bruner told Trump.

Elon Musk chimed in on X, commenting on a video featuring Bruner’s public briefing to the president about the dark-money NGOs, saying, “Way more than $100M of US taxpayer money.” 

Way more than $100M of US taxpayer money

— Elon Musk (@elonmusk) October 8, 2025

Bruner’s briefing to Trump builds on the recent New York Times report, citing a Capital Research Center report, that “Soros’ Open Society gave $80 million to pro-terror groups“…

For the first time, millions of Americans heard about the dark-money network of NGOs fueling chaos. And this won’t be the last – investigations are now ramping up.

Related:

• Trump Calls For RICO Charges Against Soros Over Violent Protest Support; Gates Foundation Abruptly Severs Ties With Rogue Arabella Advisors

*   *   * 

Submitted by Peter Schweizer & Seamus Bruner of The Drill Down,

The Government Accountability Institute’s Director of Research, Seamus Bruner, has pulled the curtain back on a troubling pattern — how non-governmental funding networks are bankrolling protest and activist movements across the U.S.

According to GAI’s findings, the chaos now gripping cities like Portland, Chicago, and Los Angeles — especially the recent waves of anti-ICE violence — isn’t spontaneous. It’s organized, coordinated, and funded.

Bruner’s new research maps how progressive philanthropic networks intersect with activist groups that have escalated from demonstrations to riots. The report highlights how complex webs of charitable entities, donor-advised funds, and online platforms provide cover for financing activism that sometimes crosses into criminal behavior.

Organizations like Antifa, the Socialist Rifle Association (SRA), and the John Brown Gun Club operate decentralized chapters, making it difficult to track funding trails without subpoena power,” Bruner said on X. “GAI has identified multiple online fundraising platforms where accountability gaps can obscure who contributes and how funds are used. The leftist funding platform, Open Collective, still allows for crowdfunding for these groups.”

Bruner joined President Trump at the White House Antifa Roundtable to expose the funding web behind America’s unrest: Antifa.

“I think we know that this is not just a story about violence and chaos … this is a money story,” Bruner told President Trump. “And at the Government Accountability Institute … we follow the money, and we followed it to the top of what we call the protest industrial complex.”

.@seamusbruner Briefs President Trump on the Money Networks Behind Antifa👇 pic.twitter.com/0QnBkisbJW

— Government Accountability Institute (@Govt_Acct_Inst) October 8, 2025

Bruner continued: “And we found a network of NGOs. It’s not just the Soros network, the Open Society network, it’s other funding networks, the Arabella funding network, the Tides funding network, Neville Roy Singam and his network, foreign cash.” 

🚨The beginning of the end for Chaos, Inc.?
The Government Accountability Institute has mapped how non-governmental funding networks intersect with protest and activist movements across the US. The chaos and unrest spreading across this country, especially the ongoing anti-ICE… pic.twitter.com/IQlYwAKWuW

— Seamus Bruner (@seamusbruner) October 8, 2025

He added, “And it’s also big, left-wing funders … they’re pouring money into this entire ecosystem.”

Watch the clip.

How the White House can counter rogue NGOs:

GAI Recommendations to @WhiteHouse & Congress:
1️⃣ Intensify investigations into opaque funding networks.
2️⃣ End taxpayer subsidies to groups tied to unlawful conduct.
3️⃣ Improve disclosure for fiscal sponsors & bail funds.
4️⃣ Review nonprofit status compliance.
5️⃣ Strengthen…

— Seamus Bruner (@seamusbruner) October 8, 2025

. . . 

What a wild week it’s been for French politics. Let’s dive right into the latest development: overnight news that President Emmanuel Macron will appoint a new prime minister by Friday evening, avoiding (for now) a snap election that could spark even more political turmoil. 

UBS analyst Aditi Samajpati updated clients with the latest: 

French President Emmanuel Macron will reportedly name a new prime minister by Friday evening, having avoided the need to call a snap election for the time being. Outgoing Premier Sebastien Lecornu told local television that sufficient progress had been made to allow work to begin on forming a new cabinet along with possibilities for a compromise in parliament.

The new PM will face significant challenges, including forming a cabinet and navigating a split parliament with three deeply antagonistic blocs, as well as the looming 2027 presidential election.

Lecornu, who resigned after less than a month in office, expects a new premier to be named rather than early legislative elections or Macron’s resignation to resolve the crisis. He emphasized that the prospects for snap legislative elections had “receded” and insisted that Macron should serve out his mandate until 2027, adding, “Let’s not make the French believe that it’s the president who votes the budget.”

There’s no indication yet on who could be the new premier – unless Lecornu is reappointed, his successor will be the eighth PM of Macron’s presidency since 2017. Lecornu suggested that a more technocratic government could be named, with people in the new cabinet not having “ambitions” to stand in the 2027 presidential elections. He highlighted the need for a team that decides to “roll up its sleeves and solve the country’s problems until the presidential election.”

Macron’s path forward for any new administration is fraught with hazards, given that parliament is deeply divided among three parties with no interest in compromising, and each is highly focused on positioning itself for the presidential election in less than two years. Meanwhile, National Rally leader Marine Le Pen, a leading contender for 2027, has vowed to censure any government backed by Macron in an effort to force fresh elections. 

UBS analyst Simon Penn noted:

The bigger concern now is how long this goes on for. Most of the conversation late Wednesday wasn’t actually about who would be the new PM, but rather that the rinse/repeat continues until 2027 and the presidential election. In other words, French politics and parliament is essentially in a holding pattern until Macron is required to ask the country the big question on the political slant of its next president.

Despite the turmoil, French 10-year yields fell five basis points to 3.51% on today’s news, while the CAC 40 has nearly erased its losses from earlier in the week.

Reporting from earlier in the week:

• Political Turmoil: France’s Le Maire Resigns Hours After Prime Minister Steps Down

• Macron Launches Last-Ditch Effort To Salvage France’s Gov’t As Resignation Calls Grow Louder

• Market Patience Won’t Last Long Without A Deal In France

Important. 

The crisis in France is about 3 things: (i) a political center that’s desperately trying to keep right-wing populism out of gov’t; (ii) broken Euro zone fiscal incentives that enable bad policy; (iii) a global rise in debt post-COVID. Long-term yields are up sharply everywhere… pic.twitter.com/TfIEohKE7z

— Robin Brooks (@robin_j_brooks) October 6, 2025

Earlier in the week, UBS analyst Penn provided clients with the three possible pathways for Macron to move forward: 

1. He can try another technocrat type

2. He can call a general election

3. He can quit and call a full presidential election

The Bloomberg Economics team provided readers with the visualization. 

So, a new Prime Minister it is, then?

And by the way, we’ll end with Macron’s imploding popularity: his approval rating tumbled to a record-low 14%, according to an Oct. 7-8 Elabe poll. 

Let’s not forget elsewhere…

Over the weekend, both Czechs and Japan elected their own version of Trump, while the Macron establishment regime imploded for good

— zerohedge (@zerohedge) October 6, 2025

. . . 

Authored by Jonathan Turley,

On Sunday, the Green Party in the United Kingdom voted to “abolish” private landlords in a move that reaffirms the party as a largely socialist movement.

For some environmentalists, it is a sad hijacking of a cause by far-left elements that moves it away from its original environmental priorities.

The motion passed at the Greens’ conference in Bournemouth calls for the  “effective abolition of private landlordism.”

That would impact roughly three million people in Britain who rent out properties, including at least one high-ranking Green official, Adrian Ramsay, who is one of the Greens’ four MPs.

Ramsay insisted that he is not making a profit on his rental and would soon stop being a landlord.

The Green Party is committed to effectively eliminating private landlords through rent controls, a “land value tax,” and other means.

The move is reminiscent of Zohran Mamdani’s call to seize unoccupied luxury condos in New York and give them to the homeless. He has also called for Democratic Socialists to “seize the means of production” in America.

Ironically, this week former New York Gov. Andrew Cuomo called out Mamdani for hypocrisy as a landlord of vacant valuable land in Uganda.

The Green Party motion states:

‘The private rental sector has failed, it is a vehicle for wealth extraction, funnelling money from renters to the landlord class…

This motion makes it clear that Green Party policy is to seek the effective abolition of private landlordism and to support the building of council housing.

…The Green Party believes the existence of private landlords adds no positive value to the economy or society, that the relationship between landlord and tenant is inherently and intrinsically extractive and exploitative.”

Carla Denyer, Green MP for Bristol Central, insists that the call to end private landlords as “inherently and intrinsically extractive and exploitative” does not actually mean an outright ban: “While the motion to confidence had an eye-catching name, it does not actually ‘abolish’ landlords.”

Once again, the Green Party has been steadily moving toward an openly socialist agenda, leaving many environmentalists at odds with the party.

Polls show that socialism is now more popular than capitalism in Great Britain, with a shocking increase in favor of communism.