A wave of AI-related deals sent semiconductor shares soaring, helping the Nasdaq rally while investors prepared for the Fed and crucial earnings from Microsoft and Google parent Alphabet.
Ahead of Meta’s ($META) earnings, 5-year credit default swaps hit new record highs on Tuesday across a range of the largest Tech companies.
“Credit default swaps tied to Oracle Corp. ($ORCL), broadly seen as a barometer for AI debt risk, traded as high as a record 343 basis points, ICE Data Services data shows. A gauge of Meta’s credit risk has also touched an all-time high, soaring as much as 6.3 basis points to 114.8 basis points ahead of its earnings report Wednesday, the data shows.”
“We have yet to find some kind of a landing zone for the level of debt issuance that the market needs to absorb,” said Lotfi Karoui, multi-asset credit strategist at Pacific Investment Management Co in an interview Tuesday. “There’s still a wide range of estimates as how much debt capital this build out will end up consuming in general.”
That comes after $451 million of hyperscaler bonds were bought on Monday, the highest net buying since mid-September — likely a result of investors selling hyperscaler debt due to supply and demand concerns, according to Bank of America.
With the rise in funding costs there hasn’t been a hyperscaler bond deal in two months. We’ll see if we get news of one from Meta who previously said in April they would not issue again until the fourth quarter. Notably, Meta has moved up its normal last Wednesday of October reporting date a week, many think to do just that.
Source: Bloomberg
Let’s look at who is really the most powerful banker in the world right now.
Is Nvidia ($NVDA) now the central bank and lender of last resort? Is the Federal Reserve’s Kevin Warsh the boss, or is it now Nvidia’s Jensen Huang?
Who really is the most powerful banker in the world right now?
Who has more impact on rates and the economy?
See the link below:
https://www.tipranks.com/news/nvidia-may-be-helping-finance-oracles-ai-data-centers-td-cowen-says
It does not stop. Now Nvidia needs to finance and backstop Oracle ($ORCL) along with everything else?
The Nvidia balance sheet soon may be bigger than the Fed’s at the rate the company is financing the economy to dig holes and fill them back up, so Nvidia can recognize revenue. The balance sheet and cash flow statement tell a very different story than earnings do. Amazing GAAP allows for this.
Then I still wonder: Does this industry have any chance of working? It still seems at the frontier lab-level, which underpins everything, the more numbers that come out, the less it makes sense. It seems this business does not and cannot scale. With every dollar of additional revenue, even at this size, comes more than an additional dollar of expense. As noted in “More Tales” this morning, Anthropic ex the accounting charge still lost $8.7 billion on $16 billion of revenue in the first six months of 2026.
Sixteen billion dollars is a lot of revenue and Anthropic still lost 50 cents on every dollar. This is why the company resorts to trying to report earnings before expenses. They have $518 billion of commitments over the next decade.
Do they have a bat phone connected to the Central Bank of Nvidia?
Positions: None.
Super Micro Computer crushes expectations while United Airlines and Alaska Airlines confirm energy input concerns. Those and other headlines are moving the market this morning.
Elice differs from the likes of CoreWeave even as its shares descend 32.0% on IPO day.
If the negative pattern develops, I’d be quick to hit the sell button.
AI needs more than Nvidia chips. Here are the companies ‘powering’ the AI buildout.
We’re seeing equity valuations collapse for semiconductor stocks, and bond yields for CoreWeave soar to distressed levels. Is the AI bubble bursting?
