 The Morning Brief | Gregor Becker · Editor-in-Chief (M.Phil Economics, Oxford) |
| Thursday, 22 October 2026 |
| Evening, all, sorry, morning. The market has again priced in good news and then been disappointed by it. Barclays will cut about 5,000 jobs, roughly 5% of its workforce, with AI getting some of the credit, and its shares fell 2.5% in early trading as fixed income trading missed. Also on the table: • | Dell jumped 5.3% after Super Micro said its revenue and profitability could be much stronger than expected, and Dell and HPE shares joined the rally |
• | Lam Research is today's argument: Jordan Bittencourt says buy a beat that still leaves it 40% below its high, while Jess Langley calls a sub-1% beat a poor answer to a stock priced for perfection. Read the debate further down ⬇️ |
Editor's note: Our Cybersecurity Portfolio owns the platforms businesses can't stop paying for. See every holding.
| | Market Snapshot Index | 24h Change | YTD | S&P 500 | +0.58% | +13.1% | Nasdaq | +1.05% | +14.9% | Dow Jones | +0.69% | +9.2% | | | DAX | -1.23% | +3.2% | FTSE 100 | -0.61% | +7.4% | Euro Stoxx 50 | -1.50% | +3.1% | Nikkei 225 | -2.65% | +21.4% | Hang Seng | -3.03% | -12.9% |
| | Top of the Morning Barclays Cuts 5,000 Jobs. AI Gets Some of the Credit. |  | Barclays cuts 5,000 jobs to lift profits already up 12% | • | 📉 The profit problem: Third-quarter pretax profit rose 12% to £2.3 billion, which sounds fine until you read that analysts wanted more. Fixed income trading income fell 19% to £1 billion, and CEO C.S. Venkatakrishnan called it disappointing: "you can be sure this will get my attention." |
• | 🎂 Icing, not cake: "We will employ AI at scale," Venkatakrishnan said, "but AI is the icing on the cake, not the cake." The bank says the cuts make its developers more productive, by having fewer of them. |
Why it matters: Barclays has spent £307 million on its overhaul so far this year and expects another £300 million by the end of 2026. It also announced a £500 million buyback, ahead of a Budget on October 28 where the bank surcharge may rise. • | 🏛️ Perfect timing: Cutting costs and returning cash to shareholders is a tidy message to send the week before the Chancellor decides how much more tax banks should pay. |
• | Our take: The AI story is real, but it arrived on a day when the trading desk missed. Cost cuts are the part of a bank's results management controls, so they get announced loudly. Whether the cake was AI or just cake, fewer people will be eating it. |
| |  | | What’s up Market data as of 6:01 AM ET: yesterday's session, pre-market where it matters S
| $SPCX +7.8% Space Exploration Technologies Corp. Space Exploration Technologies climbed 7.8% after drawing investor attention following strong third-quarter results, rising demand for AI computing capacity and growing speculation about a potential merger with Tesla. |
A
| $AMD +3.4% Advanced Micro Devices, Inc. AMD gained 3.4% after Susquehanna raised its price target ahead of earnings, as a new AI infrastructure project in India also drew attention to the chipmaker's shares. |
S
| $SKHY +2.5% SK hynix Inc. SK hynix gained 2.5% as South Korea reported a 222.5% jump in semiconductor exports, fresh evidence of strong demand after a bruising sell-off in memory stocks. |
D
| $DELL +5.3% Dell Technologies Inc. Dell jumped 5.3% as Super Micro unexpectedly disclosed that its revenue and profitability could be much stronger than originally anticipated, with Dell and HPE shares joining the rally. |
| What’s down N
| $NFLX -5.3% Netflix, Inc. |
B
| $BABA -3.9% Alibaba Group Holding Limited Alibaba slid 3.9% as investors weighed the company's aggressive AI expansion against persistent technical weakness, even as the broader U.S. market and consumer discretionary sector moved higher. |
B
| $BKNG -3.4% Booking Holdings Inc. Booking Holdings fell 3.4% after the European Union opened an investigation into Booking.com over alleged failures to tackle fake listings and phishing scams. |
I
| $ISRG -2.3% Intuitive Surgical, Inc. Intuitive Surgical fell 2.3% despite third-quarter non-GAAP EPS of $3.00, well above the analysts' consensus of $2.65, on revenue of $3.05 billion. |
| |  | | Today's Debate → | Is Lam Research ($LRCX) a buy after its 9.1% drop, or is the selloff a bigger warning sign than it looks? |
 | Jordan Bittencourt Bull 🐂 |
Yes. Lam Research ($LRCX), a supplier of semiconductor deposition and etch tools, beat on both lines and still trades 40% below its yearly high. That looks like a buy to me. • | The valuation case: Lam earns a 49.9% return on invested capital. Its operating margin is 35.3%. That is a franchise earning far above its cost of capital, and I think it deserves a premium multiple. So when the stock drops on a clean beat, what you are being handed is a cheaper entry. |
• | The risk: The technical picture was already weak before the print. The stock is at $263, its lowest level since July 29. I think the sell-off extends a slide that was already underway. Still, 26.0% revenue growth describes a business that is very much expanding. |
 | Jess Langley Bear 🐻 |
No. A beat of under one percent on both earnings and revenue did not satisfy a stock priced for perfection. A 9.1% drop is the market saying so, fairly politely. • | The thin beat: EPS beat the estimate by 0.9%, and revenue beat by just 1.0%. Benzinga called it a narrow beat. At this valuation, a rounding-error surprise offers no cushion. |
• | Jordan's best point: Jordan will point to the balance sheet, with net debt/EBITDA at -0.4x, and call it a fortress. I would answer that a net cash position protects you against bankruptcy, and nobody was worried about that. The question is price. A 2.1% free cash flow yield pays you very little to wait. |
• | The tape: Invezz flagged the stock's weak setup before the print, with shares already well below their yearly high. Add a beta of 1.85 and a 38.6x P/E, and I think this is a stock that can keep falling in a weak tape. Asian markets were sliding as well. |
| | The Digest ✨ What investors like you are reading. Oil prices rose after the US ordered diplomats to leave Saudi Arabia, Reuters reports. The Philippine central bank hiked rates by more than expected, WSJ reports, and warned that inflation will accelerate as Middle East tensions lift energy prices. Meta Platforms ($META) reports as jitters over the AI trade grow, Bloomberg Business notes. Its spending forecast could support chip demand. |
| |  | | Situational Awareness US • | Treasury refunding expectations: Barclays expects the Treasury to hold auction sizes unchanged at its quarterly refunding while loosening its forward guidance. ( WSJ) |
• | JPMorgan positioning call: Hedge fund positioning has lightened considerably since its September peak. JPMorgan ($JPM) strategists say that leaves limited downside for stocks. ( Market Watch) |
• | SpaceX-Tesla merger talk: Tesla ($TSLA) and SpaceX investors appear to believe Elon Musk can pull off the biggest corporate tie-up ever. ( TechXplore) |
• | SpaceX lifts AI optimism: SpaceX boosted AI optimism on Wednesday, lifting major US indexes. ( Barrons) |
• | Carrier Texas plant: Carrier Global ($CARR) plans a $600 million Texas plant for AI data-center cooling gear - the largest investment in its history. ( WSJ) |
World • | French bond selloff: The spread between 10-year French and German yields hit its widest level since 2011 as French government bonds came under heavy selling pressure. ( WSJ) |
• | China enters bear market: The CSI 300 index has fallen 20% from its June peak, extending a 10-week rout in mainland equities. ( CNBC) |
• | Wealth fund posts loss: The world's largest wealth fund posted a $30 billion loss after turbulence in the bond market. ( CNBC) |
• | Barclays job cuts: Barclays ($BARC) plans to cut 5,000 jobs as part of an AI-powered cost-cutting drive. ( MyrtleBeachOnline) |
| | Today's Agenda (ET) | US: Initial Jobless Claims (Oct/17) est. 200K, prev 199K |
| US: Continuing Jobless Claims (Oct/10) est. 1720K, prev 1710K |
| US: Jobless Claims 4-Week Average (Oct/17) est. 200K, prev 198.5K |
| Japan: Inflation Rate YoY (Sep) est. 2.3%, prev 1.9% |
| The Procter & Gamble Company ($PG) reports est. EPS $1.88 |
| Western Digital Corporation ($WDC) reports est. EPS $4.11 |
| Union Pacific Corporation ($UNP) reports est. EPS $3.47 |
| Blackstone Inc. ($BX) reports est. EPS $1.26 |
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