Weekday edition
Hotter October inflation, SoftBank's loss, and your savings rates
Costco announced a special dividend and a buyback, and its shares rose after hours.
At Tuesday’s close: S&P 500 −0.38%, Nasdaq-100 −0.60%, Dow −0.30%
Long-term Treasury fund slides after October inflation beats forecasts
TLT, a fund that holds long-term U.S. Treasury bonds, slid 1.3% on Tuesday after inflation ran hotter than forecast. The October consumer price report showed prices rose 0.4% and core prices, which leave out food and energy, climbed 0.3%, both above forecasts. Hours earlier, Fed Governor Christopher Waller had said a core reading around 0.3% or higher would put a larger rate hike on the table.
Bond prices fall when yields rise. The 30-year Treasury yield rose 9 basis points, and the 3-month bill yield, which tracks bets on the Fed's next move, rose 6 basis points. Polymarket, a betting market, put the odds of a December hike of 50 basis points or more at 11%, up from less than 1%. TLT lost $630 million in market value and sits 10.9% below its 52-week high. Pantheon Macroeconomics' Samuel Tombs still forecasts a 25-basis-point hike in December.
For readers
What it means for you: Tuesday took $380 from every $100,000 in an S&P 500 fund. TLT's share of the 500 largest U.S. companies' combined value is 0.05%, so its drop took $1 from $100,000 spread across them by size. On Polymarket, odds of a modest December hike rose to 85% from 79%. Odds of no change fell to 3% from 21%. A Fed hike could lift the prime rate, which most credit card and home equity line rates follow. The Fed publishes minutes of its October meeting Wednesday, Nov. 18, at 2:00 p.m. ET. They may show how far officials leaned toward hikes.
Markets
Tuesday’s close
| Market | Level | Change |
|---|---|---|
| S&P 500 | 7,520.93 | −0.38% |
| Nasdaq-100 | 27,740.79 | −0.60% |
| Dow | 52,231.89 | −0.30% |
| 10-Yr | 4.98% | +10 bp |
| Bitcoin (24 hr)As of this edition | $73,710 | −0.95% |
If you own
CD and savings rates may follow the 2-year Treasury yield, which jumped 17 basis points to 4.73% on Tuesday. The 2-year tracks where traders think the Fed's rate is heading, and banks often price CDs off that view. A 3-month Treasury bill now yields 4.30%, a benchmark for what cash can earn. The question is whether banks lift their CD offers; their posted rates over the coming weeks could show it.
Nvidia shares tumbled 5.5% on Tuesday, costing $5,470 on every $100,000 held, and the company lost $240 billion in market value. Nvidia accounts for 4.6% of the value of the 500 largest U.S. companies, so its drop took $251 from $100,000 spread across them by size. The question is how much of a broad fund rides on one chipmaker; Nvidia's next quarterly results could test the sales growth behind that size.
Bond funds lose value when yields rise. The 10-year Treasury yield jumped 10 basis points to 4.98% on Tuesday. The 30-year yield reached 5.35%, and funds holding longer bonds tend to lose the most when yields climb. Mortgage quotes, which loosely follow the 10-year, could rise too. The question is whether hotter October prices push the Fed toward a hike, as Fed Governor Christopher Waller said they could; the Fed's next decision may answer it.
Need to know
Top stories
- 1
INTC · −2.09% SoftBank swings to a loss on AI data center writedown. SoftBank reported a fiscal second-quarter net loss of 1.12 trillion yen ($7 billion), reversing a 2.5 trillion yen profit a year earlier. The loss reflected a $3.7 billion writedown on advance payments for power equipment for U.S. AI data centers. Higher financing costs and falling stakes, including Intel, also weighed. CFO Yoshimitsu Goto said SoftBank bought early on worries about equipment shortages. Intel shares slid 2.1%. Intel makes up 0.35% of the value of the 500 largest U.S. companies, so its drop took $7 from $100,000 spread across them by size. Read more
- 2
Costco jumps after hours on special dividend and buyback. Costco shares jumped 1.8% in after-hours trading Tuesday after the company announced a special cash dividend of $30 a share, roughly $13.3 billion in total. Its last special payout, in January 2024, was $15 a share. Shareholders of record at the Nov. 24 close are due the new payout on Dec. 4. The board also renewed its buyback, meaning share repurchases, of up to $4 billion through November 2030. Costco makes up 0.53% of the 500 largest U.S. companies' combined value, so broad index funds holding it could collect a slice. Read more
- 3
Venture Global raises profit forecast after third-quarter beat. Venture Global raised its full-year forecast for adjusted EBITDA, a profit measure before interest, taxes and depreciation, to $10 billion-$10.3 billion, up from $8.7 billion-$9.1 billion. The liquefied natural gas (LNG) exporter's third-quarter earnings of 96 cents a share beat the analyst estimate of 51 cents. Revenue of $4.8 billion topped the $4.687 billion estimate. About 99% of available 2026 cargoes are contracted, the company said. CEO Mike Sabel said the company plans to explore off-grid power for AI data centers using its gas and infrastructure. Read more
AI corner
Three changes that matter
Topics: Chips, Markets
CoreWeave raises its revenue forecast on demand for AI computing
CoreWeave said it raised its 2026 revenue forecast to $13 billion to $13.3 billion, above the $12.86 billion analysts estimated, and that it ended the quarter with a $132.5 billion backlog. The company expects to spend $37 billion to $39 billion this year, money that may flow to the chip makers in your tech fund.
Topics: Chips, Deals
TSMC plans stakes in Anthropic and OpenAI as October sales climb
TSMC said in a statement its board approved up to $500 million for Anthropic shares at the IPO price and up to $500 million for OpenAI preferred stock. Its October revenue reached $17.88 billion, up 59.7% from a year earlier, a pace that may ease doubts about AI chip demand.
Topics: Models, Markets
Anthropic launches office tools for Claude as software stocks slide
Anthropic launched Claude Sheets, Claude Whiteboards and Claude Data, which let its assistant draft spreadsheets and dashboards alongside coworkers, the company said. ServiceNow fell 3.1% as software stocks slid on fears that AI tools may undercut established software makers.
How it works
Core vs. headline inflation
Why the Fed steers by core inflation, not the prices you see. Headline inflation tracks everything households buy; core drops food and energy, whose prices swing, so the Fed treats it as the steadier signal. October consumer prices rose 0.4% and core prices climbed 0.3%, both above forecasts. Hours earlier, Fed Governor Christopher Waller said a core reading around 0.3% or higher would put a bigger rate hike on the table. Higher rate expectations push down bond prices: the long-term Treasury fund TLT slid 1.3%, a loss of $1,320 on $100,000 held.
Coming up
Unemployment Insurance Weekly Claims. The Labor Department counted 189,000 new filings in the week ended Oct. 31. A low count could give the Fed less reason to pause rate hikes, which matters for mortgage and savings rates.
Cisco earnings. Cisco has tumbled 24.5% from its 52-week high of $130.00, and its quarterly report may show whether business spending on network gear is holding up. It makes up 0.44% of the value of the 500 largest U.S. companies.
Producer Price Index, October. Producer prices jumped 1.3% in September, the Bureau of Labor Statistics said. After October consumer prices rose more than forecast, another hot reading could keep a larger Fed hike in discussion, which could lift borrowing costs and savings yields.
The close
The big picture. Tuesday's selling after the hotter-than-forecast October inflation report landed mostly on technology. The tech sector fund slid 1.2%, while financials rose 0.5%. The Nasdaq-100 has slid 2.3% in November after it tumbled 6.7% in October, trimming its yearly gain to 9.9%. The S&P 500, down 0.9% in October and 0.8% since, is up 9.9% for the year. The Dow is the steadier one: up 1.7% in October, 0.9% more in November and 8.7% this year.
On the calendar. October producer prices, what businesses get paid for their goods, arrive Friday, Nov. 13, 8:30 a.m. ET. They are an early signal for consumer inflation. Another firm reading could keep savings-account and money-market yields high, along with the cost of adjustable-rate loans. A softer one might ease that pressure.
Not investment advice.