ASX 200 Live Today - Friday, 16th October

Welcome to our live ASX coverage for Friday, October 16. Expect a high volume of posts pre-market and more periodic updates throughout the day. We'll be wrapping the blog up around 2:00 pm AEDT. Let us know how we can make it even better.

US producer prices jump 1.3% in September, biggest gain since 2022

[8:37 am] Higher energy costs are feeding into transport and other prices, keeping further Fed rate hikes on the table after Wednesday’s hot CPI print.

• PPI rose 1.3% m/m vs 0.6% ests, its biggest monthly gain since March 2022

• Annual PPI jumped to 6.3% vs 5.5% ests, up from 5.6% in August and the highest since December 2022

• Core PPI, excluding food and energy, rose 0.7% m/m vs 0.3% ests and 5% y/y

• Energy prices surged 10.8%, with gasoline up 20.3% and diesel up 21%, leaving diesel 115.2% higher than a year ago

• Retail sales rose 0.8% vs 0.3% ests, driven by a 6.4% jump at service stations, while core retail sales rose just 0.1%

• Futures price about a 30% chance of a Fed hike at the 27-28 October meeting, and a 91% chance of at least one hike by December

Dow jumps 556 points as investors rotate out of AI trade

[8:36 am] Wall Street recovered from early losses as investors moved out of AI stocks and into other parts of the market, helped by strong company results.

• The Dow rose 556 points or 1.08% to 52,177.69, while the S&P 500 gained 0.33% to 7,744.06 and the Nasdaq added 0.08% to 26,713.03

• The Nasdaq recovered from a 1.4% intraday fall, with Nvidia trimming an early 3.8% loss to close down 1.8%

• An equal-weighted S&P 500 rose 1.4%, and more than half of S&P 500 stocks now trade above their 200-day average, up from about 40% at the end of September

• Earnings news lifted Kimberly-Clark 4.7%, Marsh 4.6% and BNY 3.2%, after all three reported or flagged profits above ests

• The 10-year Treasury yield fell 10 basis points to 5.09%, after topping 5.30% earlier this month for the first time since 2002

• Rocket Lab fell 6.6% after delaying its Neutron rocket’s first launch to 2027 due to a manufacturing issue

TSMC beats on Q3, guides Q4 revenue 9% above ests

[8:36 am] Taiwan Semiconductor’s September quarter beat was eclipsed by fourth quarter guidance that sits well ahead of consensus as its 2nm technology ramps up.

• Revenue up 41% to US$46.72bn vs US$44.93bn ests (4% beat)

• High-performance computing made up 68% of revenue, with sales up 22% quarter-on-quarter

• Gross margin of 66.4% vs 66.3% ests (in line), down 1.3ppts on the prior quarter due to dilution from the initial 2nm ramp

• EPS of US$4.60 per ADR vs US$4.48 ests (3% beat)

• Q4 revenue guidance of US$52.3bn to US$54.3bn, with the US$53.3bn midpoint 9% above ests and implying 14% growth quarter-on-quarter

• Q4 gross margin guidance of 65% to 67%, with the 66% midpoint ahead of 65.5% ests

Kospi plunges 7.6% as global chip rout deepens

[8:36 am] Asian chip stocks were hit hardest as worries about AI spending and a potential memory chip glut spread from Wall Street.

• The Kospi plunged 7.57% to 5,554.22, its worst day since July, leaving it 39% below its June record

• SK Hynix fell more than 11% and Samsung Electronics nearly 10%, amid fears of a memory chip glut as Chinese competition grows

• The Nikkei 225 fell 4.9% to 64,425.95 and the Topix 2.38% to 3,999.34

• The ASX 200 closed flat at 8,719.7, recovering from a 0.85% fall in its first hour

• The iShares Semiconductor ETF fell for an eighth straight session, its first eight-day losing streak since 2015, taking losses over the run past 15%

• TSMC beat profit ests and flagged strong Q4 demand, but its US-listed shares still fell 1.8%

CoreWeave default risk hits record as AI debt fears spread

[8:35 am] Investors are questioning how much more the AI cloud provider can borrow, with stress spreading to bonds tied to data centre projects.

• The cost of insuring CoreWeave’s debt against default hit a record 1,194.5 basis points, implying a more than 60% chance of default within five years

• Shares plunged 15.5% on Wednesday after co-founder Brannin McBee told the FT the company wanted investment-grade ratings to tap “unlimited” insurance money

• Its 2032 bonds, issued at par four months ago, traded below 78 cents on the dollar

• Shares closed 5.9% higher on Thursday after Nvidia CEO Jensen Huang said the chipmaker did not need to backstop CoreWeave, having fallen as much as 9.5% earlier

• Bonds funding CoreWeave-linked data centres also fell, including Galaxy Digital’s $3.5bn note at 90.5 cents and Core Scientific’s $3.3bn bonds at 92.52 cents

• DA Davidson’s Gil Luria warned that borrowing at 9% to earn a 5% return destroys value, regardless of how much the company grows

Source: Bloomberg

Anthropic quarterly revenue hits $16.8bn but growth slows

[8:34 am] Anthropic’s third-quarter revenue rose strongly ahead of its planned IPO, but slower growth added to doubts about the AI trade.

• Q3 revenue rose 45% q/q to $16.8bn, from $11.6bn in Q2, the company told prospective investors

• Growth slowed from Q2, when revenue rose 147% from $4.7bn in Q1

• The FT reported Anthropic had positive cash flow in Q3

• DA Davidson’s Gil Luria said the figure disappointed, with some traders worried growth isn’t fast enough to justify chipmaker gains

• Luria still expects overall AI spending to rise steeply, as demand spreads beyond Anthropic and OpenAI

US crude jumps 3% as Iran escalates Hormuz attacks

[8:34 am] Attacks on shipping in the Strait of Hormuz and a large drop in US stockpiles lifted US crude, while Brent edged lower.

• Brent down 0.2% to US$105.73 a barrel

• US crude inventories fell 8 million barrels in the week ended 9 October

• A Singapore-registered ship was sunk in the Strait of Hormuz, and Iran said it is “counting the moments” until it can strike US warships

• The US military has drawn up plans for new strikes on Iran, including the largest non-nuclear bomb in its arsenal, CNN reported, although Trump has said he won’t restart strikes before the 3 November midterms

• The IEA warned diesel shortages could last well into next year, with fresh attacks on Saudi Arabia threatening a recovery in supply

• The Trump administration is considering easing sanctions on “shadow fleet” tankers to help lower prices, Reuters reported

UK economy beats forecasts as euro zone industry slides

[8:34 am] European data was mixed, with UK growth beating forecasts in August while euro zone factory output fell for a third straight month.

• UK GDP rose 0.1% in August vs a 0.1% fall ests, as production offset weak services and construction

• The pound rose 0.6% to US$1.3277 and UK 10-year yields fell 5 basis points to 5.37%

• Euro zone industrial production fell 1.1% y/y in August vs a 0.1% fall ests, and 0.5% m/m vs flat ests

• Ericsson shares jumped 11% in Stockholm, topping the Stoxx 600

• The FTSE 100 rose 1.08% and the Stoxx 600 0.38%, with Europe less exposed to the tech sell-off

China signals rare earths will keep flowing to Europe

[8:33 am] Beijing says it will keep approving rare earth exports to Europe whether or not its trade truce with the US is extended past January.

• China is willing to keep approving rare earth export licences to Europe, Commerce Ministry spokesperson He Yadong told CNBC

• Beijing tightened rare earth export curbs last October, covering products with as little as 0.1% China-sourced rare earths

• The US and China suspended those measures for a year in late October 2025, and US Treasury Secretary Scott Bessent said the truce was extended by two months to January

• EU-China tensions eased after trade commissioner Maroš Šefčovič met Chinese Commerce Minister Wang Wentao in Beijing last week, with China offering a “green channel” for rare earths

• European Commission leaders are meeting in Brussels on Thursday and Friday to review the China trade talks

Source: CNBC

Good morning!

[8:25 am] ASX 200 futures are up 93 pts (+1.06%). Here's what happened overnight:

• Wall Street rotated out of AI chipmakers into banks, consumer and healthcare names, with the Dow far ahead of a flat Nasdaq

  • S&P 500 (+0.33%), Equal-weight S&P 500 (+1.37%)

  • Nasdaq (+0.08%), Dow (+1.08%), Russell 2000 (+1.38%)

• US 10 and 30-year yields tumbled even after the hottest US producer prices since 2022, as AI debt worries outweighed inflation fears

  • US 2-year down 4.9 bps to 4.76%

  • US 10-year down 11.5 bps to 5.08%

  • US 30-year down 10.5 bps to 5.42%

• Oil was mixed after IEA members agreed to finish a 100m barrel stock release, while attacks around Hormuz kept supply risk elevated