CoreWeave Earnings Spark AI Relief Rally
CoreWeave (CRWV) reported earnings after the bell, setting off a "neocloud" relief rally that lifted bids across AI stocks. Anthropic's news that its IPO is several times oversubscribed added to the move. Pre-market: CoreWeave (CRWV) up 12-14%, Nebius (NBIS) up 11-12%, and Nvidia (NVDA) up 3.3%. The information technology sector of the S&P 500 looked set to open higher.
The group had been badly hurt. CoreWeave (CRWV) fell more than 50% over six months. Traders weigh three things when deciding whether to buy Nvidia (NVDA) or the neoclouds: fundamentals, sentiment, and technical analysis.
Uncertainty around AI stocks has run high in recent weeks. The Anthropic IPO news lifted some of it. Nvidia (NVDA) remains the open question, with earnings due in less than a week. That report will be a big driver, and the market needs relief and good headlines on Nvidia (NVDA).
On the Nvidia-related concern involving foreign policy: the fact that the Trump administration knew about the problem softened the blow, since it was not a complete surprise. Secretary of State Marco Rubio and others in the administration were aware of the issues. From a retail investor's view, it gives more comfort that the administration knew for almost a year and is handling it, rather than the news coming out of nowhere. The administration may have made key decisions privately, acting on the known risk.
Goolsbee Calls Inflation "Borderline Disturbing"
Fed officials made back-to-back comments: Christopher Waller and Lori Logan, then Austin Goolsbee. Goolsbee described the latest US inflation data as "borderline disturbing" and a "distressing report."
The numbers: month-over-month inflation rose 0.4%, one tenth above forecast. Core rose 0.3%, also one tenth above forecast. The worry is that pressure is spreading into other parts - food was up half a percent. Goolsbee tied the inflation to high service-sector pressure, supply shocks, and uncertainty around the administration's new trade and tariff policies. Tariffs still feed into inflation.
The odds of a 50 basis point cut in December rose to 15%, against a wider expectation of 25 basis points.
Crude oil cuts the other way. At the end of October crude sat near $103-$104; it now trades around $87, up about 1.3% pre-market. That lower level improves the overall inflation picture. Brent fell below $90 for the first time in a long while. Whether crude stays here depends on US-Iran progress. President Trump shifted tone, saying he does not favor military action, which is pulling crude prices down. The answers sit in crude oil futures.
Mortgage Demand Rises as Rates Ease
Lower rates are showing up in housing. The 30-year mortgage rate moved from 7.3% to 7.21%, down from as high as 7.5% a couple weeks ago. Purchase applications jumped 7-12%, refinances rose 4.5%, bringing the composite mortgage index up 6.2%.
The small rate drop made a clear difference. Buyers do not leave housing when rates rise; they wait on the sidelines. Rates easing to 7.21% pulled them back into the market. This shows what lower rates can do for a housing sector that has been badly beaten down.
