Dow Futures indicate an upward trajectory, following a prior session in which equities on Wall Street experienced gains, recovering from a selloff influenced by developments in artificial intelligence earlier in the week. Federal Reserve Chair Kevin Warsh refrains from offering precise interest-rate direction in advance of the central bank’s October policy meeting, yet notes that he has engaged in discussions with international central bankers regarding escalating inflationary pressures. Some investors are said to be adjusting their valuations for Claude-maker Anthropic’s potentially significant initial public offering, while Taiwan is reportedly considering stricter export controls on AI chip sales to China. Elsewhere, Tesla’s latest sports car performs aerial manoeuvres.
Dow futures remained steady on Friday. By 02:59, the Dow futures contract had increased by 75 points, or 0.1%, S&P 500 futures had advanced by 7 points, or 0.1%, while Nasdaq 100 futures remained largely stable. The primary indices concluded the trading session on Thursday with gains, recovering from a decline prompted by concerns regarding an expanding debt burden associated with the AI surge and apprehensions about high borrowing expenses. In particular, shares of neocloud CoreWeave, whose sharp decline on Wednesday contributed to the global downturn in AI stocks, showed signs of stabilisation. “Financial markets have calmed a little after CoreWeave stock bounced on Thursday. But the debate between intensifying price pressures needing tighter monetary policy and a tech correction requiring a softer policy outlook continues,” analysts said in a note.
Federal Reserve Chair Kevin Warsh provided a positive evaluation of the U.S. economy, expressing his surprise at its resilience amid stricter monetary policy. While addressing an event in Thailand, Warsh noted that he had engaged in discussions with other central bankers regarding inflationary pressures. He remarked that it is “hard to be in a discussion” with these central bankers and “not compare notes and hear the same thing about the surge in prices. As has been the case since he assumed leadership of the Fed earlier this year, Warsh refrained from disclosing any particular insights regarding the central bank’s rate trajectory. Instead, he emphasised that he doesn’t “believe in saying now what I might do at the meetings that we have in the balance of this year.” Despite Warsh’s resistance to forward guidance, some of his Fed colleagues have indicated in recent weeks that while additional rate hikes may be necessary to manage inflation, they are currently awaiting more data. In September, the Fed raised borrowing costs by 25 basis points, underscoring its intention to temper price growth to the target level of 2%. Market participants are largely anticipating that the Federal Reserve will maintain its current interest rate levels during the upcoming meeting on October 27-28. Earlier this week, bets on a possible increase this month briefly rose after consumer price data exceeded expectations, but subsequently faded. Instead, rates are expected to increase by a quarter of a percentage point once more at the Fed’s final meeting of the year in December.
Some current investors in Anthropic, as well as potential investors considering its upcoming initial public offering, are contemplating a reduced valuation for the company following a financial disclosure made this week, according to source. The prominent AI frontier lab is said to be considering a significant IPO as early as November, potentially introducing to public markets a company whose Claude chatbot has positioned it as a leading entity in the AI landscape. Some investors who attended meetings with Anthropic in San Francisco on Wednesday discussed a valuation of roughly $1.5 trillion, which would represent a decline from a previously projected valuation of around $2 trillion. Reports indicated that Anthropic informed investors at the gathering that its third-quarter revenue had surged by 45% to $16.8 billion. While the figure indicated robust demand for Anthropic’s cutting-edge AI tools, analysts noted that the revenue growth rate experienced a sequential slowdown.
Taiwan is contemplating significantly tighter export restrictions on artificial intelligence chip sales to China, aligning more closely with U.S. interests, according to a report, which referenced sources familiar with the situation. The considerations, which are part of an effort to address chip smuggling risks, are aimed at providing authorities with enhanced legal instruments to tackle the diversion of advanced hardware, primarily AI servers equipped with Nvidia chips, from Taiwan to China, according to the report. Such a measure risks provoking further discontent from Beijing, which has already expressed strong opposition to stringent U.S. limitations on AI chip exports to China, initially enacted in 2022. However, Nvidia’s advanced AI chips were still perceived to be entering China, reportedly via smuggling routes through Southeast Asia.
Tesla unveiled a redesigned Roadster on Thursday evening, employing SpaceX rocket technology to launch off a ramp and execute a controlled landing. CEO Elon Musk announced that production of the highly anticipated vehicle is scheduled to commence in 2028, more than ten years after the unveiling of a next-generation iteration of its electric sports car. Shares of Tesla experienced an increase of more than 3% during after-hours trading subsequent to the announcement. The company introduced the model during a live event at SpaceX’s McGregor, Texas test facility. The vehicle successfully ascended a curved ramp at a measured speed, executed a full inversion during the jump, and utilised its air thrusters to adjust its orientation, ultimately landing on all four wheels. Tesla also executed a manoeuvre where the car leaped and soared over a series of parked vehicles and a semi-truck.
