Cancel Bill Cramer

More than a trillion dollars were wiped out of the stock market on Thursday and Friday, reports estimate. FinTwit may have been the only thing hit harder with the announcement of an Inverse Jim Cramer ETF. The joke is officially as dead as the bull market. Let’s get up to speed on news attempted to be buried into the weekend and preview the week ahead.

Bad News Dumpster Dive

​​The “Friday news dump" is alive and well. In the spirit of highlighting all the efforts of market movers to bury their news, we've decided to excavate them. Here are all the Friday and weekend dumps for your viewing pleasure:

Saturday (all EDT):

1:33 PM: The U.S. announced its big bet on fixing the radiological and nuclear emergencies that have threatened it recently. As a result, the U.S. bought over $290 million of a drug designed to treat blood cell injuries this week. The steep bill is part of what government officials cited were long-standing efforts to prepare for potential health impacts from threats to national security (Reuters).

5:31 PM: The U.S. Postal Service said it wants to raise the price of first-class Forever mail stamps from 60 to 63 cents to account for inflationary costs (Reuters).

6:00 PM: PayPal has backtracked on a published policy that would have fined users $2,500 for spreading “misinformation,” claiming the update had gone out “in error” (Yahoo! Finance).

Friday (all EDT):

1:11 AM: Credit Suisse offered to buy back $3 billion in debt, as well as sell its landmark hotel as credit fears persist (CNBC).

6:46 AM: Ray Dalio, the former head of Bridgewater Associates, changed his mind and no longer thinks “cash is trash.” He cited that the short-term interest rate is “now about right.”

8:00 AM: Citadel’s billionaire CEO Ken Griffin became a GOP $100 million midterm mega-donor (CNBC).

8:47 AM: Rivian announced a recall of almost all the vehicles (~13,000) it had delivered to customers in order to tighten a loose fastener that could affect drivers' ability to steer.

9:03 AM: News breaks that Nancy Pelosi handed the reigns of the stock trading ban over to her close ally Rep. Zoe Lofgren. Wildly after the bill failed, late on Oct. 6th she filed a 90-days late disclosure of at least $15,000 KLAC, initially sold on July 8th. There was no fine or investigation.

11:40 AM: Amazon is abandoning its home delivery robot, the latest sign that the e-commerce giant is starting to wind down experimental projects amid slowing sales growth.

11:57 AM: GE announced it was laying off 20% of its workforce devoted to onshore wind power.

2:10 PM: Credit Suisse's volatile week spooked wealthy clients, with several families in the Middle East and Asia collectively pulling hundreds of millions of dollars.

4:02 PM: IMF board approves $1.3 billion in emergency funding for Ukraine.

5:15 PM: Teva discloses it will continue to face challenges supplying the popular ADHD drug Adderall for the next two to three months (Bloomberg).

6:39 PM: MarketWatch reports Bitcoin miner revenue has fallen 80% from its peak.

7:30 PM: Average mortgage rates in the U.S. hit 7.12%, their highest since 2001 (Mortgage News Daily).

9:11 PM: Facebook’s flagship metaverse app is too buggy and employees are barely using it, leaks an executive in charge of the project (The Verge).

Market Outlook

News to know for the week ahead

Banks will have to offload roughly $51 billion of risky committed debt for the Twitter deal. The biggest part of this chunk is the $13 billion debt financing, according to Deutsche Bank AG estimates. Musk’s $44B bid for Twitter is the gift that keeps giving, as a Delaware judge halted a court case, giving the parties more time to complete the deal. If the transaction isn’t done by 5 p.m. on Oct. 28, a new trial date will be set for November.

The US Federal Reserve minutes are released Wednesday. The Fed’s most recent meeting saw the US central bank hike rates by 75bps, pushing the Fed funds rate up to 3%-3.25%. This pushed the US dollar to a new 20-year high, sending the 2-year yield above 4% for the first time since 2007. This week’s minutes are likely to offer an insight into whether there is any unease among some Fed policymakers. There is already evidence that inflation is starting to fall back of its own accord, as lower demand prompts a tempering of prices, although core prices are proving to be slightly stickier. To date there has been little acknowledgement of the effect the surging US dollar might be having as well, particularly when it comes to the effects on US companies.

September’s U.S. CPI inflation will be announced this Thursday. Fears over US inflation stepped up a notch in August, despite the headline consumer price index (CPI) rate slipping back to 8.3% from 8.5%. The resulting market reaction saw the US dollar continue to push higher because investors had been expecting a bigger decline to 8%, while core prices rose sharply from 5.9% to 6.3%, a bigger-than-expected increase. This rise in core prices suggests that inflation is likely to be much stickier over the next few months than markets had originally been hoping, thus adding to the risk we could see the Federal Reserve not only be much more aggressive on rate hikes but keep those rates higher for longer. Across credit, money managers will closely watch a reading of US consumer prices on Thursday.

Wall Street banks completed the sale of $8.55 billion in loans and bonds backing the leveraged buyout of business software company Citrix Systems Inc (CTXS.O) by accepting a $700 million loss. Banks have already been saddled with losses of about $600 million for the buyout of Citrix Systems Inc. They will be stuck with another $6.5 billion of debt they cannot sell.

Expect markets to refine their focus on the overdue $2.25 billion in financing to help fund Latam Airlines Group SA’s exit from bankruptcy. Terms have been sweetened, and timing remains unclear.

The U.S. investment-grade bond market is expected to have a light week, experts predict. High-grade borrowers are expected to sell $15 billion of debt following Monday’s US bond-market holiday. Issuers paid an “eyebrow-raising” 46 basis points in new issue concessions on Thursday -- nearly 4 times the year-to-date average.

Inside the Trader

The scheme or schemer of the week

Goldman is busy cutting from the team that produced its infamous “working hours presentation” as it trims its bottom performers. More specifically, senior associates and vice presidents in the San Francisco technology media and telecoms (TMT) M&A team are being asked to leave.

This is the team where Joey Coslet, one of the creators behind the working conditions survey, enters the chat. And he just so happens to be the son of Jonathan Coslet, Chief Investment Officer and Vice Chairman at global investment firm TPG Capital. Coslet himself left Goldman on August 23rd, per his FINRA registration.

Trader Tip: Ask your MD to adopt you.

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