Daily Game Plan

TODAY’S GAME PLAN:  from the trading
desk, this is not research

TODAY’S ECONOMIC DATA: 10:00ET New Home Sales; 1:00ET 5-Year Note Auction; 4:10ET Fed’s Daly speaks

Highlights and News:  

• Household exposure to stocks rose to a record 65.8% in Q2
• EU TO PROPOSE TARIFF INCREASE ON OIL IMPORTS FROM RUSSIA
• Tether Seeks Funding at $500 Billion Valuation
  
• COPPER RALLIES AS FREEPORT DECLARES FORCE MAJEURE AT KEY MINE
• China said it will no longer claim the benefits available to developing nations at the WTO
  
• BESSENT LISTS CHEMICALS, AIRCRAFT ENGINES AS LEVERAGE ON CHINA
• BESSENT SAYS DISCUSSING $20B SWAP LINE WITH ARGENTINA
• Massive Sinkhole in Bangkok Swallows Cars, Prompts Evacuation

Global stocks inch up after a pledge by Alibaba Group for more AI spending and an upbeat forecast from Micron Technology reinforced optimism over artificial intelligence.
Alibaba CEO Eddie Wu anticipates overall investment in artificial intelligence accelerating to some $4 trillion worldwide over the next five years. Defense stocks also rose across Europe and Asia after President Trump said NATO nations should shoot down Russian
aircraft that violated their airspace. Zelenskiy said that Trump’s remarks on Ukraine winning back territory from Russia were a big shift and said the leaders have better relations than before. In the Middle East, Saudi Arabia’s move to ease foreign ownership
rules added $123 billion to the country’s stock market, with the bank sector surging a record 9%. Hong Kong weathered the worst of Super Typhoon Ragasa, which is now moving toward China’s southern coast.

EQUITIES: 

US equity futures nudge higher as investors evaluated cautious commentary from Fed Chair Jerome Powell and looked ahead to key economic data later in the week. Micron Technology’s shares
rose post-market after it forecast quarterly revenue above estimates. Micron, which has seen its shares almost double this year, gave an upbeat outlook driven by demand for AI equipment. Lithium Americas’ US-listed shares surged 67% after Reuters reported
that the Trump administration is weighing taking up to 10% equity stake in the company. Conferences today include Bernstein’s global healthcare event and Bank of America’s global health conference.

Futures ahead of the bell: E-Mini S&P +0.15%, Nasdaq +0.2%, Russell 2000 +0.1%, DJI +0.1%

In pre-market trading, Amazon (AMZN) gains 1.4% following an upgrade at Wells Fargo on greater conviction in the company’s Amazon Web Services division. Acadia Pharmaceuticals
(ACAD) shares are halted after the company said its Phase 3 trial of intranasal carbetocin (ACP-101) in patients with hyperphagia in Prader-Willi syndrome failed to meet its primary endpoint. Adobe (ADBE) is down 1.3% as Morgan Stanley downgrades to equal-weight
from overweight on decelerating digital media revenue. Bloom Energy Corp. (BE) falls 6% after Jefferies cut its recommendation on the fuel cell power generator to underperform from hold. Lithium Americas (LAC) soars 68% after reports revealed the US is seeking
an equity stake in the company as it renegotiates terms of a $2.3 billion government loan. PayPal Holdings Inc. (PYPL) climbs 1.3% after Blue Owl Capital Inc. agreed to buy about $7 billion of buy now, pay later loans from the company. UniQure (QURE) shares
are halted after the company said phase I/II trial of AMT-130 in Huntington’s disease met its prespecified primary endpoint.

European gauges are lower as investors tempered optimism around the path of US interest-rate cuts after Chair Jerome Powell gave no signs he would support a reduction
at the central bank’s October meeting. Defense stocks are at the top of the leaderboard following President Trump’s comments on NATO and Ukraine. Europe’s Stoxx 600 is holding just above the early lows, with automakers and financial services underperforming
while utilities and energy shares outperform. Gerresheimer AG, a German maker of packaging for medicines, plunged the most ever after the country’s markets regulator initiated an audit of its accounts. Asker Healthcare Group falls as much as 6.4% after Swedish
pension fund AP6 sold its entire holding in the company. Pinewood Technologies shares plunge as much as 14% after the software maker’s 2025 Ebitda target disappointed. Stoxx 600 -0.35%, DAX +0.15%, CAC -0.7%, FTSE 100 -0.1%. Autos -1.6%, Chemicals -1.4%, Financial
Services -1.2%. Aero & Defense +1%, Utilities +0.4%.

Shares in Asia were mixed to higher, with the MSCI Asia Pacific Index gaining 0.2%. Alibaba gave the biggest boost while bank shares weighed on the gauge. The Hang
Seng Tech Index surged more than 2% after Alibaba said it would beef up its AI budget and unveiled its new Qwen3-Max large language model. Alibaba shares surged over 9% to their highest in nearly four years after revealing plans to ramp up AI spending past
an original $50 billion-plus target. China’s homegrown tech suppliers climbed, boosting key equity measures on the mainland as well as in Hong Kong. Australia’s main index declined nearly 1% after monthly consumer prices rose more than economists expected,
weakening the case for a rate cut next week. Zijin Gold International delayed its $3.2 billion listing after Super Typhoon Ragasa slammed Hong Kong. Hang Seng Tech +2.5%, Hang Seng Index +1.4%, Vietnam +1.4%, CSI 300 +1%, Thailand +0.4%, Topix +0.2%, Indonesia
was flat. Philippines -0.2%, Taiwan -0.2%, Kospi -0.4%, Sensex -0.5%, ASX 200 -0.9%.

FIXED INCOME: 
 

Treasury yields are higher except for 2-year which is 1bp lower on the day. 10-year yield is +3bps at 4.13% with the curve steeper. 2s10s +4bps, 5s30s +1bp. Bond
traders are dialing back Fed rate cut bets for 2025, now pricing in just one more reduction as mixed signals from officials cloud policy expectations. US session focus includes a 5-year note auction, on the heels of Tuesday’s solid 2-year note sale.

METALS: 

Gold inches higher as investors look ahead to the US Personal Consumption Expenditures index, the Fed’s preferred inflation gauge, on Friday for further cues on rate
cuts. Fed Chair Powell said that the central bank would continue to balance concerns surrounding weakness in the labor market and rising concerns on inflation, while Fed officials took stances on both sides of the monetary policy path divide. Elsewhere, NATO
warned Russia on Tuesday that it would use “all necessary military and non-military tools” to defend itself, as U.S. President Trump shifted rhetoric toward Ukraine. Spot gold +0.1%, Silver +0.2%, Copper futures -0.6%.

ENERGY:   

Oil extended its biggest gain in a week, as Trump ramped up his rhetoric against Russia and traders watched for supply disruptions.
Trump said he believed Ukraine could retake all its land occupied by Russia, marking a sudden shift in rhetoric in Kyiv’s favor. Russia is considering restrictions on diesel exports
for some companies following attacks by Ukrainian drones on its energy infrastructure, including pipeline facilities, that have put the nation’s supply in focus. US crude inventories fell 3.8 million barrels last week, the API reported. That would reduce total
holdings to the lowest in three and a half years if confirmed by the EIA today. WTI +1.2%, Brent +1%, US Nat Gas -0.7%, RBOB +0.7%. 

CURRENCIES: 

In currency markets, the dollar is higher after back-to-back losses. Aussie dollar fluctuated after Australia’s inflation gauge accelerated to 3% in August, the highest
reading in a year. The euro slides after an unexpected drop in German business confidence. The yen fell versus the dollar as Sanae Takaichi, top contender to lead the ruling Liberal Democratic Party, said monetary policy was up to the Bank of Japan but higher
rates could affect mortgages and corporate investment. US$ Index +0.5%, GBPUSD -0.5%, EURUSD -0.5%, USDJPY +0.55%, AUDUSD +0.1%, NZDUSD -0.4%, USDCHF +0.35%, USDCAD +0.25%, USDSEK +0.6%, USDNOK +0.55%.

Bitcoin +0.9%, Ethereum +0.1%. Crypto ETFs set to flood US market as regulator streamlines approvals. Tether is in talks with investors to raise as much as $20 billion,
a deal that could propel the crypto firm into the highest ranks of the world’s most valuable private companies. The deal could value the company at around $500 billion, putting it into the same league as OpenAI and SpaceX.

Colors within the report:
Green is always the 200 period (day, week).
Red is always 21,
Blue = 50,
Brown =
100 *Stars have added importance 

• Upgrades
• Amazon (AMZN) Raised to Overweight at Wells Fargo; PT $280
• General Motors (GM) Raised to Buy at UBS; PT $81
• LTC Properties (LTC) Raised to Market Perform at BMO; PT $39
• Micron (MU) Raised to Outperform at KGI Securities; PT $196
• Nasdaq Inc. (NDAQ) Raised to Strong Buy at CFRA
• Open Text (OTEX CN) Raised to Sector Outperform at Scotiabank; PT C$69.14
• Quanta Services (PWR) Raised to Buy at Jefferies; PT $469
• ServiceNow (NOW) Raised to Overweight at Morgan Stanley; PT $1,250
• Valley National (VLY) Raised to Buy at Jefferies; PT $14
• Vor BioPharma (VOR) Raised to Buy at Stifel; PT $55
• Downgrades
• Adobe (ADBE) Cut to Equal-Weight at Morgan Stanley; PT $450
• Bloom Energy (BE) Cut to Underperform at Jefferies; PT $31
• Choice Properties REIT (CHP-U CN) Cut to Sector Perform at National Bank
• CrowdStrike (CRWD) Cut to Sell at DZ Bank; PT $440
• Keurig Dr Pepper (KDP) Cut to Equal-Weight at Barclays
• KLA Corp (KLAC) Cut to Hold at CFRA
• Knight-Swift (KNX) Cut to Neutral at Susquehanna
• Initiations
• Assembly Bio (ASMB) Rated New Market Outperform at Citizens; PT $38
• Axon (AXON) Rated New Overweight at Piper Sandler; PT $893
• Cipher Mining (CIFR) Rated New Buy at Arete; PT $24
• Didi Global (DIDIY) ADRs Rated New Overweight at JPMorgan; PT $10
• Dominion Lending Centres Inc (DLCG CN) Rated New Buy at Canaccord
• High Tide (HITI CN) Reinstated Buy at Canaccord; PT C$7.25
• IREN Ltd (IREN) Rated New Buy at Arete; PT $78
• Kyivstar Group (KYIV) Rated New Outperform at Oppenheimer; PT $20
• Mirum Pharma (MIRM) Rated New Buy at TD Cowen; PT $95
• Motorola Solutions (MSI) Rated New Neutral at Piper Sandler; PT $495
• Ocean Power Technologies (OPTT) Rated New Buy at Ladenburg Thalmann
• Oddity Tech (ODD) Rated New Buy at Jefferies; PT $78
• Packaging Corp (PKG) Rated New Overweight at JPMorgan; PT $242
• Resources Connection (RGP) Rated New Buy at Northcoast; PT $7
• Riot Platforms (RIOT) Rated New Buy at Arete; PT $26
• Sana Biotech (SANA) Rated New Outperform at Wedbush; PT $5
• Vita Coco (COCO) Rated New Hold at Needham
• Reinstated Buy at William O’Neil

Data sources: Bloomberg, Reuters, CQG

David Wienke