US 10-year hits 5% after hot core CPI

EU mid-market update: US 10-year hits 5% after hot core CPI; CoreWeave jumps 18% as older GPU prices rise 30-50%; Anthropic’s blockbuster IPO has terms reset.

The brief

- A hot October CPI, led by 0.45% supercore services, pushed the 10-year yield above 5% and made a Dec hike close to certain, with every Fed speaker leaning hawkish. CoreWeave’s results showed AI compute is scarce, with demand at 10x capacity and older GPUs repricing 30-50% higher, but its refusal to issue unsecured debt at current yields shows capital is getting more expensive. Nvidia is up 4% in premarket after slumping 9.5% this week on governance and export-control pressure, and Anthropic’s IPO has been reset to a valuation of up to $1.4T. In Europe, RWE and Siemens Energy beat on power and grid demand while E.ON slipped, and Germany’s 2.8% inflation keeps an ECB hike in play. Still ahead are Friday’s PPI, Nvidia’s earnings on Nov 17 and next week’s Xi-Trump summit in Shenzhen.

Observations in full

- October CPI met Waller’s 50bps threshold, and inflation has moved into services. Headline CPI rose 0.4% m/m against 0.3% expected, and core rose 0.3% against 0.2%. Core services rose 0.34% and supercore 0.45%, a 5.5% annualised pace, with airfares up 0.84% and core goods up 0.39%. Owners’ equivalent rent rose 0.32% while primary rents rose only 0.20%, so the overshoot came from services outside housing. The BLS published no y/y rates, and estimates of core y/y built on a calculated October 2025 base put it near 4.1%. The 10-year yield rose about 10bps to just over 5%, and the 10-year auction cleared at 5.02%. CME pricing moved to 91% for a 25bps December hike and 10% for 50bps, up from zero before Waller spoke. Waller had said a 50bps hike “should be considered” if core came in around 0.3% or higher, because a 25bps move could put credibility at risk. Every Fed speaker after the print leaned hawkish. Goolsbee called the report “borderline disturbing” because services inflation is not coming down. Philadelphia’s Paulson, a voter, backed further “gradual” hikes and a “somewhat restrictive” stance, Logan said at least two more hikes are needed, and Bowman said the focus is shifting to inflation. A supercore print this hot, with oil falling, matches the Fed research Waller cited showing energy shocks now pass more persistently into core services. The fall in petrol below $4 will help headline inflation but not the services categories the FOMC is watching. The S&P 500 fell 0.4% and the Nasdaq 0.7%, though Nasdaq 100 futures are up 1.4% this morning on CoreWeave. Friday’s PPI is forecast at 6.6% y/y.

- CoreWeave’s results contradict the view that AI capacity is in surplus, and its funding plan shows the price of capital rising. Q3 revenue of $3.66B beat $3.55B expected, FY26 guidance was raised, and the stock rose more than 16% after hours. Qualified demand is 10x available capacity through end-2027, and 2028 demand is already several times capacity before formal marketing. CoreWeave is deliberately holding back unsold 2028 capacity to get better terms later. Pricing rose about 25% in July, another 10% later in Q3 and again in Q4. Older Ampere and Hopper GPUs repriced 30-50% higher sequentially, above their original contract prices, the same generation Microsoft is reportedly giving back to Oracle. That points to a strong re-letting market for older capacity rather than a glut. About 130K GPUs come off contract in 2027 and 170K in 2028, which CoreWeave values at nearly $4B of 2027 annualised revenue, rising to nearly $10B including 2028, with no new capex. New 4-5 year contracts price at $20-25M per MW a year, against more than $40M for short-term deals. On funding, CoreWeave will not issue parent-level unsecured debt “at current yields”. It will use delayed-draw term loans matched to contracts, plus a secured facility covering more than 90% of associated capex at 7-7.5%, and expects about $9B of customer prepayments over the next three months. With the 10-year above 5%, unsecured debt costs too much even for a company whose capacity is sold out. CoreWeave sees no material risk to 2027 deliveries from the post-election policy shift, and 1.3GW of its 4.6GW contracted power is outside the US. Siemens Energy, meanwhile, took the cautious side: its CEO said the data-centre market “got too hectic” and some expansion expectations were “too ambitious”, but that the power demand trend is intact.

- Nvidia fell 5.5% on Tuesday, and today is Huang’s deadline to respond to the House chairs. The stock is now about 15% below its Nov 6 close. Axios reports the Commerce Department received a national-security warning about the relationship, and US Ambassador Perdue said the affair shows Washington must stay “diligent” on China. The Information reported on Monday that the White House is considering new export controls on advanced Nvidia chips, and Taiwan press says H200s are piling up in Hong Kong under stricter inspections. Bessent confirmed Xi and Trump will meet next week in Shenzhen and again in Miami. He said the US expects talks with China on handling AI models before release and is setting up a direct channel for AI incident alerts. The White House is building AI cooperation with Beijing while Commerce reviews a warning about the CEO whose chips are at the centre of that relationship. Earnings follow on Nov 17, the requested briefing on Nov 18, and the Shenzhen meeting the same week. Korea’s exports for Nov 1-10 rose 111.9% y/y, after 102% in the prior period, so memory and hardware shipments are still accelerating regardless of Nvidia’s governance problems.

- Anthropic’s IPO terms have been reset in both directions within 48 hours, and the revenue figures now in circulation give a tighter valuation test. After a representative sent banks a filing showing about 867M shares at $70-80, then emailed to say the pricing was inaccurate, the deal is now reported at up to $64.4B at a valuation of up to $1.4T. The FT says the bankers are prepared to go above $1.5T if demand allows. Traders are circulating an unverified Barclays note putting the Q4 guide at about $19.3B. That is about 14% above Q3 revenue of $16.96B in the revised S-1, but annualises to only about $77B, against reported end-October ARR of about $81B. The guide implies November and December revenue below October’s run-rate, a conservative choice for a company about to price a record IPO. At $1.4T, Anthropic would trade at about 18x the annualised Q4 guide. OpenAI’s private round, at $1.25T pre-money, values it at about 31x the $10B Q3 revenue The Information says it reported to investors. On those figures the public deal is cheaper per dollar of revenue than its main competitor’s private round. The S-1’s $895.4B of infrastructure commitments is about 14x the raise, and CoreWeave’s results show the cost of serving those commitments rising: older Hopper GPUs have repriced 30-50% above their original contracts, and new long-term contracts run at $20-25M per MW a year. Compute providers are gaining pricing power at the labs’ expense, so gross-margin guidance is the key test for the roadshow. That roadshow could have started meeting investors on Tuesday, with a livestreamed Amodei-Dimon event planned. It overlaps with Nvidia’s Nov 17 earnings, Huang’s Nov 18 briefing and a 10-year yield above 5%. Microsoft fell on Tuesday after Anthropic launched Claude workplace tools, the first time an Anthropic product launch has visibly hit a hyperscaler partner’s stock during the deal.

- Oracle’s CFO says the company is now fully funded and will not raise again, after losing two capacity customers in two weeks. She told CNBC Oracle wanted to be “the first of the fully funded hyperscalers” and “done with the endless narrative of funding Oracle”, and is “very serious” about being “one and done”. That refers to the $10B of stock sold at $116, an 11% discount, and the $10B of notes priced on Nov 2. The notes priced eight days before the 10-year crossed 5%, when CoreWeave said it would not issue unsecured debt at current yields, so Oracle locked in its funding just before costs rose. She said Oracle has fixed the gross-margin percentage on its memory purchases, so DRAM and HBM inflation passes to customers on a cost-plus basis, the approach AMD described as sharing costs with customers. That protects margins on the memory component of AI racks, which Apple called “unprecedented”. She repeated that Oracle will be cash-flow positive in H2 2028, the same year the Texas permit pause and Georgia’s new commission put greenfield capacity at risk. She said Oracle remains committed to the New Mexico data-centre project and is confident it will come online “over time”. That is the Stargate site in Doña Ana County, where the developer and state regulators have asked to postpone the Dec 7 air-permit hearing and the applicant has waived the Nov 23 decision deadline, with a Dec 3 pipeline milestone still pending. She called OpenAI “a customer and a partner”, and its reported $10B Q3 revenue strengthens the counterparty behind Oracle’s largest contract. The Tencent cancellation and Microsoft’s return of older-GPU capacity look less damaging after CoreWeave reported Hopper pricing up 30-50%, since Oracle can re-let that capacity for more than Microsoft was paying.

- European energy results show which assets are scarce. RWE’s 9M adjusted net income rose to €1.85B from €1.29B, and adjusted EBITDA to €4.58B. E.ON’s adjusted net income slipped to €2.2B from €2.30B on lower revenue. Siemens Energy’s Q4 net income of €1.26B beat €1.17B expected, on revenue of €12.8B. Generators are earning more while networks absorb grid investment, consistent with every other sign that connected power is the scarcest asset in the buildout. ICL said Q4 bromine prices are already above Q3. Germany’s October CPI was confirmed at 2.8% y/y, -0.2% m/m, five weeks before the ECB meeting at which Lane has called a hike prudent.

- Geopolitics: Iran threatened Bessent, and the Baltic states are on alert. The NYT reports Bessent recently moved out of his home onto a military base after threats from Iran against his life, just as the administration says talks are making progress. Lithuania told residents of the Marijampolė region near Kaliningrad to take shelter, after Latvia and Lithuania issued warnings about threats in airspace near Belarus, while Russia-Ukraine talks continue in Abu Dhabi. The House voted to block impeachment articles against Defense Secretary Hegseth, which reduces the chance of a post-midterm departure at the Pentagon for now.

- Asia and corporate. The PBOC is consulting banks on taxing interest on government bonds, and the yuan fix weakened to 6.7191, its weakest since Oct 22. Takaichi said she has “no intention” of pursuing fiscal policy that leads to excessive inflation. ENEOS’s H1 net income rose to ¥512B from ¥65B, and Nissan returned to an operating profit of ¥80B. Costco declared a $30 special dividend and reauthorised a $4B buyback. Barrick filed to sell a minority stake in its North American gold assets through an IPO of American Barrick. Qualcomm priced $4B of notes at 5.00-5.80%. Politico reports the CFTC has warned Kalshi that charges may be imminent. Petrobras missed, with Q3 adjusted EBITDA of BRL85.8B against 95.6B expected.

- Cross-asset: A 0.45% supercore print pushed the 10-year above 5% and odds of a 50bps December hike to 10%, with Goolsbee, Paulson, Logan and Bowman all leaning hawkish, so falling petrol prices are not enough to offset services inflation. CoreWeave’s 10x demand-to-capacity ratio and 30-50% repricing of older GPUs point to scarce compute through 2027, while its refusal to issue unsecured debt at current yields shows the rising cost of capital. Nvidia, down about 15% since Nov 6, faces Huang’s response deadline today, Commerce’s warning and new export-control talk ahead of earnings and the Shenzhen summit. Anthropic’s reset terms ($64.4B, up to $1.4T, with bankers ready to go above $1.5T) and OpenAI’s $10B Q3 show lab revenue is moving fast. RWE and Siemens Energy beat on generation and grid demand. Ahead: PPI Friday, Nvidia Nov 17, Shenzhen next week.

- Asia closed higher with KOSPI outperforming +2.6%. EU indices -0.3% to +0.5%. US futures +0.1-1.7%. Gold +0.5%, DXY +0.2%; Commodity: Brent +2.0%, WTI +1.3%; Crypto: BTC -0.7%, ETH -1.7%.

Asia

- South Korea Oct Unemployment Rate: 2.5% v 2.6%e.

- South Korea Nov 1-10th Exports Y/Y: 111.9% v 102.0% prior; Imports Y/Y: 45.0% v 65.5% prior.

- Korea Oct Total Bank Lending To Household (KRW): 1.204T v 1.199T prior.

- Australia Q3 Home Loans Value Q/Q:-15.5% v -8.0%e.

Europe

- UK NIESR [think tank] urged BoE to raise key interest rates to ~5.0%. Inflation to remain above the Bank of England's 2% target until 2030.

Americas

- Fed forced to confront case for bigger and faster rate hikes.

- Fed's Goolsbee (non-voter in 2026; voter in 2027) noted that the recent October inflation report was distressing.

- Fed Paulson (voter) noted that further ‘gradual’ rate hikes were appropriate given high inflation.

- Fed Vice Chair of Supervision Bowman (FOMC voter) noted shifting focus to inflation; Needed to think about the pace and timeline for addressing inflation issue.

- Fed's Schmid (hawk; non-voter in 2026) saw some concerning trends in prices underneath the whole energy story.

- Fed's Logan (voter, hawk; non-voter in 2027) noted that more rapid rate hikes of at least two additional 25 bps were needed this winter.

- House vote to impeach Defense Sec Hegseth failed on a 211-204 vote (**Note: vote could be tried again in January when Democrats will have >255 members).

Energy

- Weekly API Crude Oil Inventories: -9.8M v -5.3M prior.

Speakers/fixed income/FX/commodities/erratum

Equities

Indices [FTSE +0.26% at 10,780.00, DAX +0.46% at 26,512.85, CAC-40 +0.30% at 8,303.04, IBEX-35 -0.30% at 19,899.74, FTSE MIB -0.25% at 51,627.50, SMI -0.23% at 15,003.80, S&P 500 Futures +0.73%].

Market focal points/key themes: European equities edge toward record highs, with the STOXX 600 up about 0.4%, the DAX up 0.5%, the CAC 40 up 0.3% and the FTSE 100 up 0.3%, while the IBEX 35 (-0.3%), FTSE MIB (-0.25%) and SMI (-0.2%) lag, as CoreWeave’s revenue beat and raised annual forecast ease fears about AI-infrastructure demand after last week’s politically driven semiconductor and software rout. Chips lead the rebound, with Infineon up 7%, ASM International up 6%, BE Semiconductor and Technoprobe up 5% each, STMicroelectronics up 4% and ASML up 3%, while Siemens Energy jumps 7.5% after FY27 margin guidance of 14% to 16%, a more than tripled dividend and an additional €9B buyback, and FLSmidth adds 5% on a 36% rise in Q3 orders. Vestas drops 7.5% as adjusted free cash flow fell to €99M from €508M and turbine order intake declined 27%, Alcon falls 7% after narrowing its margin and EPS-growth outlook on competitive pressure, and ITV loses 3.5% after guiding Q4 advertising revenue down 5% to 10%, with Brenntag, NIBE and Taylor Wimpey also lower on a Q3 miss, a heat-pump overcapacity downgrade and a trimmed completions forecast. The macro tone stays hawkish after Tuesday’s hotter-than-expected US CPI, which cemented a December Fed hike and prompted some fixed-income allocators to question whether a 50 bps move could be required, while oil bounced from two-month lows on fresh attacks on Hormuz shipping and ECB President Lagarde’s remarks are awaited for guidance on the divergence between a stalling euro-zone economy and accelerating US inflation.

Equities

Consumer discretionary: ITV [ITV.UK] -3.5% (Q3 advertising revenue fell 8%, with Q4 total advertising revenue forecast to decline 5–10% and the full-year drop seen at 2–3%), Taylor Wimpey [TW.UK] -2.5% (FY26 operating profit is now expected at the lower end of the £262m–£299m consensus range and the home-completion forecast was cut to approximately 10,500).

Healthcare: Alcon [ALC.CH] -7.0% (Q3 sales missed consensus and the company narrowed its core operating-margin and EPS-growth outlook amid competitive pressure).

Technology: Infineon [IFX.DE] +7.0%, ASM International [ASM.NL] +6.0%, BE Semiconductor Industries [BESI.NL] +5.0%, Technoprobe [TPRO.IT] +5.0%, STMicroelectronics [STM.IT] +4.0%, ASML [ASML.NL] +3.0% (European semiconductor names rallied after CoreWeave beat quarterly expectations and raised its annual forecast, easing concerns about AI-infrastructure demand).

Energy: Vestas Wind Systems [VWS.DK] -7.5% (Q3 revenue and profit missed expectations, adjusted free cash flow fell to €99m from €508m and turbine order intake declined 27%).

Industrials /defence: Siemens Energy [ENR.DE] +7.5% (FY26 profit margin more than doubled, FY27 margin guidance was set at 14–16%, the dividend more than tripled and an additional €9bn buyback was announced), FLSmidth [FLS.DK] +5.0% (Q3 order intake rose 36%, revenue increased 10% and FY26 adjusted EBITA-margin guidance was lifted to approximately 16.5%), Spirax Group [SPX.UK] +4.0% (10-month organic sales growth and margins improved from H1, reinforcing guidance for mid-single-digit revenue growth and a margin above 20%), NIBE Industrier [NIBE-B.SE] -3.5% (Nordea downgraded to Hold from Buy and cut its target to SEK43 from SEK50, citing heat-pump overcapacity, pricing pressure and elevated expectations).

Financials: ICG [ICG.UK] +3.5% (fee-earning assets under management increased to $89.7bn and the interim dividend was raised despite lower H1 profit), Mediobanca [MB.IT] +3.5% (Intesa Sanpaolo’s MPS offer document confirmed plans for a subsequent mandatory offer for the Mediobanca shares not already controlled through MPS), ABN AMRO [ABN.NL] +1.0% (Q3 net profit of €940m beat the €782m consensus and 2026 commercial net-interest-income guidance was raised above €6.9bn), Swiss Life [SLHN.CH] -2.5% (nine-month direct investment income declined to CHF2.96bn and the solvency ratio eased to around 205% despite higher premiums and fee income).

Materials: Antofagasta [ANTO.UK] +4.0%, Glencore [GLEN.UK] +2.5%, Fresnillo [FRES.UK] +2.5% (miners advanced as copper and silver prices rebounded), Brenntag [BNR.DE] -4.0% (Q3 results were slightly below forecasts, with the Specialties division missing consensus and group gross margin contracting).

Utilities: RWE [RWE.DE] +1.0% (nine-month adjusted EBITDA rose 35%, energy trading exceeded expectations and management guided toward the upper end of its FY26 ranges), E.ON [EOAN.DE] -1.5% (nine-month adjusted EBITDA was broadly flat and results merely met expectations, with no increase to the group’s investment plans).

Speakers

- ECB’s Nagel (Germany) noted that the recovery in Germany was stronger than forecast but reforms were still needed. Growth to accelerate in Q4.

- Japan PM Takaichi stated that govt and BOJ would continue to coordinate to achieve stable prices, economic growth. To work with BOJ on price stability and economic growth.

- China PBoC Q3 Monetary Policy Implementation Report reiterated stance to maintain its moderately loose monetary policy. Reiterated to use, adjust monetary policy tools at appropriate time and prevent exchange rate overshoot risk. Vowed to safeguard stable stock market operations.

- Iran Security Chief Rezaee said that would not remove enriched nuclear from country. Any US attack on Iran to trigger strikes on distant US bases.

Currencies

- USD maintained a slight positive tone in the aftermath of Tues CPI data. Fed now being forced to confront case for bigger and faster rate hikes. Data put into play multiple Fed rate hikes in the coming months. A plethora of Fed speak heightened concerns over inflation.

- EUR/USD at 1.1140 by mid-session and USD/JPY at 158.85.

- The 10-year German Bund yield last at 3.28%, France 10-year Oat at 4.74% and 10-year Gilt yield at 5.18%; 10-year Treasury yield: 4.99% (cash market closed on Wed); 10-year JGB: 2.78%.

Economic data

- (DE) Germany Oct Final CPI M/M: -0.2% v -0.2% prelim; Y/Y: 2.8% v 2.8% prelim.

- (DE) Germany Oct Final CPI EU Harmonized M/M: -0.1% v -0.1% prelim; Y/Y: 2.8% v 2.8% prelim.

- (SE) Sweden Oct Household Consumption M/M: 1.2% v 0.5% prior; Y/Y: 3.3% v 2.7% prior.

- (TR) Turkey Sept Retail Sales Y/Y: 7.7% v 10.1% prior.

- (IT) Italy Sept Industrial Production M/M: 1.2% v 0.7%e; Y/Y: -0.1% v -0.8%e; Industrial Production NSA (unadj) Y/Y: -0.1% v +3.2% prior.

Fixed income issuance

- (IN) India sold total INR230B vs. INR230B indicated in 3-month, 6-month and 12-month bills.

- (UK) DMO sold £1.0B in 0.125% Jan 2028 Gilts via tender; Avg Yield: 4.185% v 4.272% prior; bid-to-cover: 3.94x v 3.76x prior.

- (SE) Sweden sold SEK5.0B vs, SEK5.0B indicated in 2.75% Feb 2037 SGB bonds.

- (NO) Norway sold total NOK2.0B vs. NOK2.0B indicated in 2029 and 2042 bonds.

Looking ahead

- (CO) Colombia Oct Consumer Confidence: No est v 15.7 prior.

- 05:25 (EU) Daily ECB Liquidity Stats.

- 05:25 (CH) Switzerland to sell 2030 and 2040 Bonds.

- 05:30 (DE) Germany to sell combined €250B in 2047 and 2056 Bunds.

- 06:00 (PT) Portugal Oct Final CPI M/M: No est v 0.2% prelim; Y/Y: No est v 3.8% prelim.

- 06:00 (PT) Portugal Oct Final CPI EU Harmonized M/M: No est v 0.0% prelim; Y/Y: No est v 3.9% prelim.

- 06:00 (IE) Ireland Oct CPI M/M: No est v 0.2% prior; Y/Y: No est v 4.1% prior.

- 06:00 (IE) Ireland Oct CPI EU Harmonized M/M: No est v 0.2% prelim; Y/Y: No est v 3.8% prelim.

- 06:00 (RU) Russia to sell OFZ Bonds.

- 06:30 (CL) Chile Central Bank Traders Survey.

- 07:00 (US) MBA Mortgage Applications w/e Nov 6th: No est v -1.2% prior.

- 07:00 (BR) Brazil Sept IBGE Services Volume M/M: -0.3%e v -0.1% prior; Y/Y: -0.5%e v +0.6% prior.

- 07:00 (MX) Mexico Sept Industrial Production M/M: -0.2%e v +0.6% prior; Y/Y: 2.9%e v 3.5% prior; Manufacturing Production Y/Y: 2.8%e v 3.2% prior.

- 07:00 (UK) Weekly PM Question time in House.

- 07:00 (IE) ECB’s Makhlouf (Ireland).

- 08:00 (RU) Russia Sept Trade Balance: No est v $11.7B prior; Exports: No est v $40.9B prior; Imports: No est v $29.2B prior.

- 08:00 OPEC Monthly Oil Report (MOMR).

- 08:00 (UK) Daily Baltic Dry Bulk Index.

- 09:00 (BR) Brazil Oct Vehicle Production: No est v 268.3K prior; Vehicle Sales: No est v 281.4K prior; Vehicle Exports: No est v 39.8K prior.

- 10:30 (EU) ECB’s Vujcic (Croatia).

- 14:30 (EU) ECB chief Lagarde.

- 16:45 (NZ) New Zealand Oct Total Card Spending M/M: No est v -0.5% prior; Retail Card Spending M/M: No est v -0.4% prior.

- 16:45 (NZ) New Zealand Sept Net Migration: No est v 1.53K prior.

- 18:50 (JP) Japan Oct PPI (domestic CGPI) M/M: +0.3%e v -0.3% prior; Y/Y: 6.5%e v 6.8% prior.

- 19:00 (AU) Australia Nov Consumer Inflation Expectation: No est v 5.3% prior.

- 19:01 (UK) Oct RICS House Price Balance: -34%e v -32% prior.

- 21:00 (JP) Japan Oct Tokyo Avg Office Vacancies: No est v 1.9% prior.

- 21:00 (NZ) New Zealand to sell combined NZ$350M in 2031 and 2037 bonds.

- 21:30 (HK) Hong Kong to sell 3-year and 10-year Bonds.

- 22:35 (JP) Japan to sell 5-year JGB Bonds.