1The bond market has priced in a December rate hike, and a 5% risk-free yield is now competing directly with stocks and private credit
The 10-year Treasury yield traded above 5.35% on Thursday, its highest level since 2002, Quartz reported via Yahoo Finance. The 30-year hit a 2002 high as well. The cause runs through oil. Fresh Iranian attacks on tankers in the Strait of Hormuz pushed Brent past $102. That revived fears of faster inflation. Minutes from the September Fed meeting then pointed to another rate hike this year, and the Fed's Christopher Waller said more hikes were needed, CNBC reported. The Dow fell 451 points. A strong 10-year auction later pulled yields back. FRED's official daily close was 5.28% on 7 October, against 5.27% the day before.
Prediction markets moved the same way. Kalshi's December contract prices a 25bp hike at 73¢, up from 70¢, on open interest of about 126,000 contracts. An October hike rose to 18¢ from 16¢, on about 63,000 contracts traded in a day, so the market still expects any hike to wait for December. Polymarket agrees, with 15.5% on an October hike and $449,000 traded in 24 hours. Kalshi's September CPI contract, which settles on next week's report, priced inflation above 3.6% at 44¢, up from 38¢. Inflation expectations are rising with oil.
On Excess Returns, Katie Stockton of Fairlead Strategies argued from the chart that the move is structural. She read the 10-year's break above 4.75% as the end of a long sideways range. Her next resistance is 5.25%, a level dating back to 2006 and 2007, and she expects yields to keep grinding higher into next year rather than fall back.
Two other sources took that yield and compared it with what investors already own. Ross Givens set the 10-year at 5.28% against non-traded private credit funds that are limiting withdrawals. He asked why anyone would wait in a redemption queue when Treasuries pay more than 5% and can be sold any day. Brian, the host of Business with Brian, made the same point for retirees. A Treasury held to maturity at 5% pays more than a 4% withdrawal rate, he said, so this is the one moment he would add bonds.
So what: higher oil feeds expected inflation, which keeps the Fed hiking, which keeps the risk-free rate above 5%. Every other asset now has to beat that rate. If next week's CPI comes in hot, the December hike becomes close to certain.
2Paying for the AI build-out is getting harder, and the strain is showing in credit before stocks
On 24 September Oracle sent a force majeure notice on Project Jupiter, a 2.5-gigawatt data-centre campus in New Mexico being built for OpenAI, Ross Givens reported. Force majeure is the clause a party invokes when something outside its control stops it delivering. Here the problem is power: New Mexico declined to extend a natural-gas pipeline in July. Blue Owl owns the developer and put in about $3 billion of equity, and a group of banks lent another $18 billion. Givens added that S&P cut Oracle to BBB- in July, one notch above junk. S&P also counted $260 billion of signed leases that start between fiscal 2027 and 2029 and are not yet on the balance sheet. One more downgrade would push Oracle's debt to junk, which many bond buyers are not allowed to hold in size. On Thursday Oracle fell again after taking on more debt to buy AI chips, Yahoo Finance reported.
The same strain is showing in private credit funds that cannot be traded on an exchange. Givens said investors asked to withdraw 13% of the Ares Strategic Income Fund in the third quarter and were paid 38% of what they requested. Across the industry, $13.8 billion of withdrawals were requested last quarter and about 40% were met. The number he watches is new money coming in: for the Ares fund it fell from $1.75 billion to $165 million year on year, a 90% drop. Blackstone 's flagship fund saw about 10% requested but held its payouts at the 5% quarterly cap. Givens said the redemption wave started before the Oracle letter, so neither event caused the other. In his words, they are "cracks in the same pipe". These figures are as he reported them and have not been checked against the funds' own filings.
On Prof G Markets, Ed Elson and John Foley, who writes the Lex column at the Financial Times, looked at SpaceX . The company raised $86 billion in its IPO four months ago and $25 billion in bonds soon after. It is now seeking $40 billion more to buy Nvidia chips. Its credit default swaps, the cost of insuring its debt, rose to 194bp from 110bp in June. Its long bonds trade around 85 cents on the dollar. Foley's arithmetic: Musk's target of 10 gigawatts of data centres by the end of next year implies about $500 billion of spending. He said the market is "not sending out a distress signal" yet, but the company is getting riskier. Losing its investment-grade rating would be the trigger to watch. Elson argued the analysts' price targets may be shaped by the banking fees on hundreds of billions of new issuance.
Stocks have not repriced yet. Tech fell on Thursday after a report that OpenAI's revenue came in below expectations. By the overnight session, chip and cloud stocks were edging up, and one analyst called the reaction "overblown", per Stocktwits via Yahoo. Samsung's disappointing preliminary results also cooled the memory-chip trade. Meanwhile, Cameron Robertson of Platinum Asia, on Equity Mates, argued SK Hynix trades at about four times next year's earnings and will make more money than the market expects. The two sources point in opposite directions, and nothing published this week settles it.
So what: the build-out now depends on borrowed money, and the lenders are the first to hesitate. Watch three things. Can Oracle hold its rating? Do more force majeure notices appear at other sites? Do the December redemption requests at private credit funds rise or fall? Any one of them would turn a credit-market story into an equity one.
3A promise not to strike Iran before the midterms lowered the odds of war, but not the odds of Hormuz reopening
On Thursday the President posted that talks with Iran were "productive". He said the US would not attack Iran before the 3 November midterms, and that the blockade would stay. He also said 22 million barrels had passed through the Strait of Hormuz in a single night. Oil fell on the comments, Reuters reported. Yahoo Finance showed November crude down 1.2% at $90.36 overnight, after a 4% jump on Wednesday.
Prediction markets accepted the promise without treating it as a deal. On Polymarket, the US–Iran ceasefire holding through 31 October rose five points to 76.5%, on $227,000 of 24-hour volume. Through 15 October it rose six points to 92.5%. But Hormuz traffic returning to normal by 31 December stayed at 18.5% ($126,000 traded), and a US–Iran Hormuz agreement by the end of October slipped to 15.5%. The market reads the post as fewer US strikes, not more shipping. Reuters reported tanker attacks at their worst week of the war, Iran vowing to block more routes, and Houthi missiles hitting Riyadh airport.
Stockton set the range on the chart. She sees crude in a wide triangle with support near $87 and resistance near $105, and a long-term uptrend that turned in February. On Equity Mates, Robertson said about 80% of the energy that came through the strait went to Asia before the war. Higher fuel has hit poorer consumers there hardest. Indonesia's market has fallen about a third this year as its currency weakened on oil imports.
So what: the post took the tail risk of a US strike off the table until November. It did nothing for the shipping disruption that drives the oil price, the yield and the Fed. The market's 18.5% says Hormuz is still the variable, and it is not improving.
4Below the record S&P 500, the average stock is close to a selling washout, and Asia outside AI hardware trades near multi-decade-low valuations
Stockton sees the long-term bull market as intact. The S&P 500 and Nasdaq 100 have just set records. Yet the share of stocks above their 50-day average is near historically oversold levels, which she called unusual with the index at a high. She reads it mainly as a short-term washout that should bring a bounce in breadth, while conceding it could mean wider damage hidden by the narrow leadership. On small caps she is more cautious. The Russell 2000 is below her daily trend band, and her monthly momentum gauges have rolled over, which puts her in a "sell the rallies" frame there. She called semiconductors constructive in the short to medium term, though new highs may be harder from here. Credit spreads are not yet giving a sell signal, she said, but they sit close enough to resistance that this could change before year-end. Her own sector-rotation ETF is about 50% in stocks, with the rest in short and long Treasuries and gold, a mix her rules-based model has built for possible weakness in 2027.
Robertson made the same split for Asia. Over the past 12 months, technology hardware delivered all of the region's return, he said, about 28%, while every other sector combined went slightly backwards. Foreign ownership in Vietnam and Indonesia is near two-decade lows. The Indonesian market trades at about 10 times earnings, a level last seen in 2008. He said Sea Limited was not cheap enough for him when so much else in the region is.
So what: the index level is hiding a broad sell-off underneath. Stockton sees that as a setup for a recovery in breadth. Robertson sees a valuation gap outside AI. Both are judgement calls, and neither recommends betting against the leaders.
What the sources recommended
Calls came from three of the five videos, and two of the three come with a commercial interest stated in the episode. Brian, on Business with Brian, named the ETFs he uses for long-term buckets: semiconductors for growth, the S&P 500 as the anchor, and dividend payers for defence. He paired the picks with their cost: in 2022 his young-investor mix fell 27%, against 16.7% for a traditional 70/30 split. The video was sponsored by a portfolio-tracking app. He listed , , and as overlapping alternatives, not separate picks.
Cameron Robertson, on Equity Mates, described names his Platinum Asia Fund owns. Platinum sponsored the episode, so these are a fund manager's own holdings, presented in his own interest. They are Tencent (US over-the-counter shares), which he says the market treats as an AI loser at about 12 times earnings; Astra International at about six times earnings; confectioner Mayora at 13 times; and Vietnamese retailer Mobile World at a teens multiple. He also named SK Hynix, Philippine chicken chain Jollibee, the Indian hospital group Yatharth and Chinese stage-lighting maker Guangzhou Haoyang. Their exchange symbols do not fit the format this page tracks, so they are recorded as views rather than tracked calls.
The one exit came from Ross Givens: anyone holding a non-traded private credit fund such as the Ares Strategic Income Fund should start asking for their money back now, because the 5% quarterly cap makes leaving slow. His video also promotes his paid trading service.
Next week's CPI decides whether December's hike is priced or locked in
Delta reports before the open on Friday, the first read on how airlines are handling jet fuel above $100 a barrel. Next week, September CPI and the big-bank results (JPMorgan, Goldman Sachs, Citi, Wells Fargo, Bank of America, Morgan Stanley and BlackRock) arrive within two days of each other. The CPI print tests the 44¢ Kalshi price on inflation above 3.6%, and with it the 73% December hike. The bank results are the first earnings test of how much of the private credit and AI lending stress has reached the lenders' own books.
