AI jitters in focus; Anthropic’s reported revenue jump - what’s moving markets
Investing.com - S&P and Nasdaq futures point lower following a drop in shares in the previous session sparked by jitters around the artificial intelligence trade and higher-for-longer interest rates. Media reports say Anthropic unveiled a jump in third-quarter revenue to institutional investors, although the rate of change of top-line growth cooled at the AI bellwether. But AI demand remains strong, with TSMC, the world's largest contract chipmaker, posting a new record high profit.
1. Futures subdued
U.S. stock futures hovered mostly below the flatline on Thursday. By 02:54 ET (06:54 GMT), the Dow futures contract had inched up by 27 points, or 0.1%, S&P 500 futures had dropped by 38 points, or 0.5%, and Nasdaq 100 futures had fallen by 407 points, or 1.4%.
The main averages on Wall Street retreated in the prior session. Hotter-than-anticipated September consumer price growth prompted some investors to increase their bets on a Federal Reserve rate hike later this month. This sent stocks lower and U.S. Treasury yields surging, although the selloff in bonds moderated later in the session.
Analysts suggested that the modest recovery in Treasuries was linked to traders shifting out of riskier AI names and into the perceived safety of U.S. debt. Worries abounded that climbing rates could impact a wave of debt-fueled spending propping up an AI industry already grappling with intensifying competition both domestically and abroad. Shares of AI cloud group CoreWeave were especially hard hit, sliding by more than 15%, while some of its bonds tumbled to new lows in secondary markets.
At the end of the session, both the benchmark S&P 500 and tech-heavy Nasdaq Composite had slumped to their biggest one-day decreases since July.
2. Anthropic revenue surges 45% to nearly $17 billion - reports
Despite the sharp drop in AI stocks, high-profile AI frontier lab Anthropic was pushing to maintain what has been runaway enthusiasm around the nascent technology, reportedly telling institutional investors during a meeting on Wednesday that its third-quarter revenue rose by 45% to $16.8 billion.
Anthropic, whose popular Claude chatbot has made the company a standard bearer of the wider AI industry along with rival OpenAI, previously logged revenue of $11.6 billion in the second quarter and less than $5 billion in the first quarter, according to the Wall Street Journal.
In a note, analysts at Vital Knowledge said that while such solid quarter-on-quarter growth would be celebrated "in any normal world," the rate of change is cooling, possibly raising a red flag for investors.
"[I]n the land of AI, where investors are used to parabolic figures, a slowdown in growth undercuts sentiment," the analysts wrote.
The numbers are being closely scrutinized largely because Anthropic plans to raise as much as $100 billion with a valuation of roughly $2 trillion in a potential blockbuster initial public offering, the WSJ reported. When exactly that IPO will happen remains a mystery, but Anthropic is aiming to unveil more details about its operations in IPO paperwork over the coming weeks, the WSJ said.
3. TSMC's record profit
Although fears have surrounded the outlook for AI players, demand for the technology and the infrastructure underpinning it appears to have remained robust.
The latest example comes from Taiwan Semiconductor Manufacturing Co., or TSMC, which clocked fresh record profit of 763.06 billion New Taiwan dollars in the three months to September 30, a 69% jump from a year ago.
LSEG estimates cited by Reuters had seen the figure at NT$746.3 billion.
Revenue soared by 50% to NT$1.49 trillion. Gross margin was 66.4%, operating margin was 58.7%, and net profit margin was 51.1%, TSMC said.
The company said that it had considered setting up more facilities in the U.S., potentially in Texas, as it races to ramp up capacity to meet increasing demand.
4. U.S. producer prices ahead
On the economic calendar, a monthly reading of the U.S. producer price index could offer yet another glimpse into the state of inflation in the world's largest economy.
Month-on-month, producer prices for final demand are seen rising by 0.6% in September, compared to 0.4% in the prior month. In the twelve months to September, PPI is tipped to come in at 5.3%, versus 5.4% previously.
On Wednesday, a separate gauge of consumer price growth from the Labor Department accelerated by more than anticipated, highlighting the effect of an energy shock linked to the Iran war. This week's inflation data is critical, as the figures will be the most up-to-date Fed policymakers will have before the convene for a two-day meeting on October 27-28.
Beyond inflation, investors will have the chance to parse through trackers of retail sales and initial jobless claims.
5. Oil dips
Oil prices fell, as traders assessed supply risks stemming from attacks on tankers near the Strait of Hormuz and a report that the U.S. is considering easing sanctions on vessels to reduce petroleum shipping costs.
Brent oil futures slid 1.9% to $104.02 a barrel by 03:35 ET, while West Texas Intermediate crude futures fell 1.1% to $94.04 a barrel.
A container ship and dry bulk container both sank near Hormuz over the past 24 hours due to strikes from separate projectiles, according to maritime officials cited by Reuters. Strikes on vessels in the critical chokepoint have increased in recent days, exacerbating concerns over ongoing disruptions to Gulf oil flows.
Fighting between Saudi Arabia and Houthi militants in Yemen has also driven worries that the Middle East conflict could be expanding, threatening traffic through other key shipping conduits, namely the Bab el-Mandeb Strait connecting the Red Sea with the Gulf of Aden.
With energy prices rising, U.S. President Donald Trump has been mulling over easing sanctions on so-called shadow fleet vessels that transport oil and derivatives from sanctioned countries including Russia, Iran, and Venezuela.
(Reuters contributed reporting)
Original Article
AI jitters in focus; Anthropic's reported revenue jump - what's moving markets
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