Thursday Watch

Around X:

• @Business  

• President Trump said tolls on ships sailing in the Strait of Hormuz would be a red line issue for the US in negotiations with Iran. 
• The Bank of Japan is increasingly highlighting the economic benefits of the global AI boom, viewing strong demand for AI-related products as a buffer against the drag from higher energy prices linked to the Middle East conflict.
• Militaries from the US to China are racing to build sea drones, reshaping warfare across the Indo-Pacific’s vast waters.
• Get up to speed on what's moving global markets.
• Here’s what you need to know to start your day.   

• @ZeroHedge

• IRGC Navy: Safe passage through the Strait of Hormuz is only possible through the routes announced by the Islamic Republic of Iran; Coordination with the IRGC Navy is required for passing through the Strait and violating vessels will be dealt with.
• Tennessee Considers Up To 26 GW Of Gas-Fired Generation. 
• *BOJ'S TAMURA: NEED TO RAISE RATE EVERY FEW MONTHS.
• China's Refiners Slash Runs To Lowest Since 2017, As Asia Refiners Slow Purchases Of Mid-East Oil.
• "Heavy Casualties" After Massive Twin Quakes Rock Venezuela, Topple Buildings; "International Response May Be Needed".
• They've sent me this video of Maiquetia Airport. My God... (video)    
• Antifa Leader Sentenced To 100 Years In Prison For Attack On ICE Facility.
• Hormuz Exodus Begins: Ships Finally Sailing As UN-Led Evacuation Corridor Opens.
• *JAPAN QUAKE SHAKING INTENSITY 6+ ON SCALE OF 7: NHK.
• Transcript Shows Bill Gates Claim Epstein Issued 'Veiled' Threats Over Affairs.
• Senate Passes War Powers Resolution In Rebuke Of Trump Policy.
• Lockheed Martin Wins $35b THAAD Interceptor Contract.
• are ai chatbots politically biased? what the washington post found from testing: (graph)       
• Bessent: Rate Cuts Don't Have To Break The Dollar.
• *TRUMP: OIL COMPANIES NOT REDUCING GAS PRICES ENOUGH. *TRUMP: SPOKE WITH OIL COMPANIES TODAY. *TRUMP, ASKED ON DOJ OIL PROBE, NAMES CHEVRON, BP, EXXON MOBIL.
• Fauci, The CIA, And The Unanswered Questions Of COVID.
• Big-Tech, Bond Yields, Bitcoin, Black Gold, & Bullion All Battered Ahead Of Micron.    

• @CNBC

• CNBC Daily Open: Nvidia may still be tech’s king, but Micron just stole a scene. 
• SK Hynix surges 11% after filing for blockbuster Nasdaq listing.
• Thursday's big stock stories: What’s likely to move the market in the next trading session.
• S&P 500 futures rise as Micron bounces after earnings; Wall Street awaits key inflation reading: Live updates.
• Anthropic accuses Alibaba of campaign to 'brazenly' and 'illicitly' extract AI capabilities.
• JPMorgan Chase unveils $50 billion buyback, Goldman Sachs raises dividend after Fed stress test.
• Bitcoin falls back under $60,000, hitting its lowest level since October 2024.     

• @TheTranscript

• $QCOM: "Multiple large markets are reaching inflection points, as AI compute becomes increasingly distributed across devices, edge and cloud over the next 3-5 years, including agent-ready edge devices, data center infrastructure, automotive, industrial systems, networking and robotics." 
• Key Figure's Important Statement. Micron CEO. We currently have no outlook on when memory supply will catch up with the increase in demand.
• $QCOM Qualcomm has unveiled an expanded diversification strategy at Investor Day, raising its FY29 non-handset revenue target to $40B, nearly 2x its prior target, with new goals of >$15B in data center revenue, $10B in auto revenue & >$14B in IoT revenue by FY29.
  $QCOM: +13% AH.
• $MU Micron CFO: "In fiscal Q4, we project capex of around $10B, bringing FY 26 capital spending to $27B. We expect quarterly capex in fiscal 2027 to be above fiscal Q4 levels, with more than half the increase Y/Y in fiscal 2027 from construction capex as we pull in cleanroom capacity required to address long-term demand.".
• $MU CEO: "Humanoid robots carry 10X the amount of memory as an average L2+ vehicle, and we expect a sustained, substantial multi-decade memory demand cycle to begin in the latter part of this decade".
• Micron CEO on why ramping up memory supply will take time: "Memory industry supply growth is dependent on significant greenfield fab expansions. These greenfield projects are large, complex and time consuming. Further, the pace is constrained by several factors, including long lead time for fab construction across the world, shortage of workers with critical trade skills, complex regulations including permitting, and the need for enhanced energy infrastructure".     
• Micron Q3 26 (YoY). — Revenue: +345.7% to $41.4B (+73.7% QoQ). — Gross Margin: +46.9pp to 84.6% (+10.2ppts QoQ). — Operating Income: +1,436.1% to $33.3B (+106.5% QoQ). — Net Income: +1,398.3% (+104.9% QoQ) to $28.24B. — OCF: +450.8% (+113.4% QoQ) to $25.39B. 

Night Trading 

• Asian equity indices are +.25% to +2.25% on average. 
• Asia Ex-Japan Investment Grade CDS Index 68.25 +.5 basis point. 
• China Sovereign CDS 37.75 -.25 basis point.
• China Iron Ore Spot 98.20 USD/Metric Tonne -.2%. 
• Crude Oil 69.20/bbl. -1.7% 
• Gold 3,995.20 USD/t oz. -.3%. 
• Swiss Franc/Offshore Chinese Renminbi Cross 8.40 +.12%.
• Bloomberg Emerging Markets Currency Index 34.78 -.03%.
• Bloomberg Global Risk-On/Risk Off Index 122.2 +1.0%.
• US 10-Year Yield 4.40% +1.0 basis point.
• Japan 30-Year Yield 3.87% -1.0 basis point. 
• Volatility Index(VIX) futures 19.0 -2.2%.
• Euro Stoxx 50 futures +.02%. 
• S&P 500 futures +.44%.
• NASDAQ 100 futures +1.6%.

Morning Preview Links

BOTTOM LINE: Asian indices are mostly higher, boosted by technology and financial shares in the region. I expect US stocks to open modestly higher and to maintain gains into the afternoon.  The Portfolio is 75% net long heading into the day.