The Morning Brief

Futures are split down the middle overnight, Nasdaq higher and the Dow lower, and the swing factor is as much geopolitics as it is tech earnings, with traders digesting a blowout Micron (MU) quarter that barely moved the stock.

Overnight:

Asia opens the tape with a mixed signal. Japan's Tankan survey shows large manufacturers at 24 versus 25 expected, big manufacturing outlook at 21 versus 22 expected, and capex growth slowing to 11.3% from a 12.3% estimate, all pointing to cooling business sentiment even as the index beat prior-quarter readings. China's AI buildout keeps running regardless: the FT reports Tencent (TCEHY) is leasing 100,000 chips from Oracle (ORCL) to accelerate its AI push. Chinese EV makers posted strong September deliveries, with Nio (NIO) up 25.4% year over year and XPeng (XPEV) up 15% quarter over quarter. In Europe, UK Nationwide house prices cooled more than expected, both month over month and year over year, adding to signs the housing market is losing steam on that side of the Atlantic too. Washington is also leaning on allies: Reuters says the U.S. has told France and Germany to release diesel stockpiles or face an export ban, and Bloomberg flags tanker congestion pushing oil transfers farther from Hormuz, both feeding a 1.6% move higher in oil (USO). The bigger overnight swing factor is the Mideast: a U.S. ceasefire proposal reaching Iran lifted Nasdaq 100 futures while weighing on the Dow. Crypto is mixed, bitcoin soft while Ethereum, XRP, and Dogecoin firm up, and Worldcoin rallied 10% to close out September.

Macro:

Challenger reported September job cuts at 43,281, down 18% from August's 52,881, a rare soft landing data point. It lands alongside a darker read from housing: Lennar (LEN) and KB Home (KBH) both warned conditions have "deteriorated" with mortgage rates back above 7%, even as Berkshire Hathaway quietly added 660,410 Lennar shares this week.

AI infrastructure, the dominant narrative:

Micron delivered a Q4 double beat and guided to an "even stronger" year, flagging tighter memory supply-demand into 2027-2028 and signaling bigger buybacks off its $73 billion cash pile, yet the stock (MU) barely budged, up just 0.2%, a sign the bar for AI-chip surprises keeps rising. Alphabet (GOOGL, GOOG) jumped on the Gemini 4 Argon launch. Amazon (AMZN) signed a 20-year nuclear power deal with Constellation (CEG) to feed AI data-center demand, and reports surfaced that Meta (META) classified data centers as "pilot models" for a tax benefit on its AI spend.

Movers:

Vicor (VICR) is up sharply premarket after raising Q3 revenue guidance above $186 million versus estimates near $165 million, with Needham reiterating Buy and lifting its target to $350. Boeing (BA) landed a $20 billion Navy deal and a new Ethiopian Airlines freighter order, though shares remain lower on the year. Paramount Skydance's (PSKY) acquisition of Warner Bros. Discovery (WBD) is now expected to close October 6.

On the radar today:

Accenture (ACN) and McCormick (MKC) report before the bell, Nike (NKE) reports after the close.

Bottom line: the macro backdrop is cooling gently while the AI capex race accelerates, and today's test is whether Nike and Accenture can hold the market's attention against that bigger story.