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Stocks rise. Amazon rallies. Oil jumps.

Stocks rise before a US payrolls report. Traders will scour the data for clues before next week’s Federal Reserve meeting.

Amazon rallied in early trading on strong earnings, which showed growth in cloud computing and online retail. Apple gave a tepid forecast for holiday sales. Intel jumped as the results spark optimism of a turnaround. 

Oil jumps as Axios reports that Iran may be preparing to attack Israel from Iraqi territory in the coming days. Exxon Mobil and Chevron release earnings today. 

UK bonds extended losses, with the 10-year set for the worst week of the year. Chancellor Rachel Reeves sought to reassure markets, saying in a Bloomberg TV interview that the government's “No. 1 commitment” is “economic and fiscal stability.”

Treasury 10-year yields edge lower but still post the biggest monthly jump since September 2022 ahead of the October non-farm payrolls report due Friday.

Wall Street advisory panel endorses Treasury tokenization

Wall Street’s top financial advisers to the US Treasury Department have issued a detailed report supporting the tokenization of government debt while emphasizing the need for centralized control. The Treasury Borrowing Advisory Committee, which includes executives from major firms like Citigroup Inc. and Goldman Sachs Group Inc., released its findings on Wednesday, October 30, 2024. The committee’s report highlights the potential benefits of converting traditional Treasury assets into digital tokens. (Blockonomi | Oct 31)

US Treasury sees no auction size increases through January, announces $125 billion refunding

The US Treasury Department said on Wednesday it does not anticipate increasing auction sizes for notes and bonds for at least the next several quarters, in line with market expectations, as it announced a $125 billion refunding from November 2024 to January 2025. The department will refund about $116.4 billion of privately held Treasury notes and bonds maturing on Nov. 15 to raise new cash of $8.6 billion from private investors. (Reuters | Oct 31)

Key inflation rate hits 2.1% in September, as expected, closing in on Fed target

Inflation increased slightly in September and moved closer to the Federal Reserve’s target, according to a Commerce Department report Thursday. The personal consumption expenditures price index showed a seasonally adjusted 0.2% increase for the month, with the 12-month inflation rate at 2.1%, both in line with Dow Jones estimates. The Fed uses the PCE reading as its primary inflation gauge, though policymakers also follow a variety of other indicators. (CNBC | Oct 31) see also Low US weekly jobless claims, solid consumer spending showcase economy's strength (Reuters | Oct 31)

Wall Street sees lines blur between private credit and bank debt

A chorus of Wall Street chiefs said the worlds of private credit and traditional bank debt continue to collide. The $1.7 trillion private credit market swelled in size by providing capital to private, non-investment-grade companies or other businesses that couldn’t get traditional bank financing. Now, though, asset managers like Apollo or rival Blackstone Inc. are trying to lend more to established businesses — putting them in a position to unseat Wall Street incumbents further. (Bloomberg Industries - Finance | Oct 29)

Yellen says fraud is huge, growing problem in banking system

US Treasury Secretary Janet Yellen said that fraud in the banking system is becoming a huge problem and that her department is now using artificial intelligence to detect and deal with the issue. The Treasury Department is now using AI to tackle this issue, Yellen said. “It’s really made a dramatic difference in our ability to detect and deal with fraud.” (Bloomberg Markets | Oct 29) see also Yellen says tailoring bank rules helpful, but strong capital requirements needed (Reuters | Oct 29)

SEC adopts new rule for covered clearing agencies

The US Securities and Exchange Commission (SEC) has adopted amendments and a new rule to improve the resilience, recovery, and wind-down planning of covered clearing agencies. For the new rule, the regulatory body says it prescribes requirements for the contents of a covered clearing agency’s recovery and wind-down plan. Existing rules require a covered clearing agency to have a recovery and wind-down plan, and the new rule requires such an entity to specify nine elements for its plan. The new rule’s required elements address planning for the identification and use of scenarios, triggers, tools, staffing, and service providers; timing and implementation of the plans; and testing and board approval of the plans. (Securities Finance Times | Oct 28)

The Amazon HQ2 campus in Arlington, Virginia, US. Photographer: Al Drago/Bloomberg

Amazon cybersecurity sleuths emerge from the shadows

Amazon’s threat intelligence unit, which has been around since 2010, is starting to make a name for itself after working in the shadows for years. Earlier this month, the company announced that it had helped disrupt the activities of Anonymous Sudan, a group accused of waging distributed denial-of-service attacks against Western targets.

— Bloomberg | Cyber Bulletin

Infostealer infrastructure dismantled

Police from the Netherlands, the US, and the UK took down servers supporting the Redline and Meta malware. In recent years, this malware has been linked to hacks at Uber and other high-profile organizations. Using "Infostealer" malware, attackers can harvest personal, financial, and other data from compromised systems.

— TechCrunch

US agency to launch review of undersea cables, national security risks

The Federal Communications Commission plans to update its oversight rules for the more than 400 undersea cables vital to the global internet and, therefore, US national security. The rules were last reviewed in 2001, FCC Chair Jessica Rosenworcel said Wednesday. Eight senators last week voiced concern about potential sabotage of the cables by Russia or other adversaries.

— Reuters

Starbucks is recalibrating its operations after three consecutive quarters of declining same-store sales. Photo: Gabby Jones | Bloomberg News

Starbucks is bringing back the condiment bar

Starbucks' new leader promised fundamental change, as the coffee giant pledged not to raise prices in the US over the coming year and to restore condiment bars in cafes. The coffee giant is recalibrating its business and operations after three consecutive quarters of declining same-store sales and longer-running challenges at its cafes. Customers have grumbled about long waits and high prices for drinks, cutting into the company’s sales and compounding the challenge of bringing consumers back to its stores.

— The Wall Street Journal

The unraveling of space-time

Many physicists suspect we are in for a radical re-understanding of reality, as big as the one Albert Einstein orchestrated more than a century ago. With his theory of relativity, the patent clerk united space and time into a single, malleable substance — space-time. In doing so, he transformed the inert nothingness behind the world into a dynamic fabric of the world, one with folds that we experience as the force of gravity. Now, it’s Einstein’s fabric that needs unraveling. A belief has come to dominate theoretical physics that even nothingness ought to come from something — that space-time must break up into more primitive building blocks that don’t inhabit space or time.

— Quanta

This is why you don't recognize your state government

This election year's most underappreciated story is happening everywhere and yet is entirely overshadowed by the race for the White House. A trove of legislative and electoral data reveals that voters get ignored when one party secures control. No matter who wins the presidency, the nation goes in two directions. In short, political choice is vanishing.

— Bloomberg