Finance, in brief

US consumer prices rose 3.7% in the year to September, the Bureau of Labor Statistics, the US government office that measures prices, said on Wednesday. [1] That was up from 3.4% in August and above the 3.6% economists had expected. [1][3]

Prices rose 0.6% in September alone. [1] Petrol rose 9.1% in the month and made up about half of that rise. [1]

The rise is spreading beyond fuel. [2] Housing costs rose 0.4% in the month, used cars 0.7% and air fares 1.2%. [2]

Core prices, which leave out food and energy because they jump around, rose 2.6% from a year earlier, up from 2.4%. [1][2] Over the last three months they rose at a yearly pace of 3.4%. [2] Yearly price rises have now been above the US central bank's 2% target for about 65 months in a row. [13]

Pay is falling behind. [2] Once prices are taken out, average hourly pay was 0.7% lower than a year earlier, and prices have outrun pay for six months in a row. [2]

The war with Iran, which began in late February, is the main reason, because it pushed up the price of oil and the fuels made from it. [3][4]

Before the figures, traders put the chance of a US rate rise at the meeting on 27-28 October at about 22%. [5][2] Afterwards CME FedWatch, a gauge read from traders' bets, showed 47%, and other readings during the day ran from about 35% to 50%. [2][7][6]

The Federal Reserve, the US central bank, raised its main rate last month for the first time in three years, to about 3.9%. [4] Two of its officials, Michelle Bowman and Mary Daly, said it can wait for a clearer picture before raising rates again. [6] On Wednesday the dollar rose to its highest since April 2025. [17] By Thursday it had given back most of that jump. [6]

On Wednesday the S&P 500, an index of 500 big US companies, fell 1.1%, its worst day since July. [7] The Nasdaq, an index full of technology companies, fell 1.9%. [7]

Companies that borrow heavily to build AI fell hardest. [7][9] CoreWeave, which rents out AI computers, fell 15.5%, and Oracle, a cloud computing company, fell 8.8%. [7]

The ten-year US government borrowing rate briefly went above 5.32% after the figures, from under 5.17%. [7] It ended the day lower, at 5.19%, still near its highest since 2002. [16][15]

On Thursday South Korea's main share index, the Kospi, fell about 8%, and the fall set off a trading halt early in the session. [10] SK Hynix, a memory-chip maker, fell more than 10%, and Samsung, its bigger rival, between 7% and 11% as the day went on. [10][11][12][18] Japan's Nikkei index fell 4.8%. [12]

Why it matters. The next test is the US central bank's meeting on 27-28 October, a week before the midterm elections, and first come Thursday's figures on what producers charge and what shops sold. [5][16][33]

CoreWeave, which rents out computers for AI, saw its shares fall 15.5% on Wednesday. [19] A bond it sold in June paying 9.625% a year now trades at a price that gives a new buyer about 15%. [9] Bloomberg said that is a level that usually marks a borrower in trouble. [18] CoreWeave has borrowed through $22 billion of bonds and $26 billion of loans. [9] Its boss told staff the market is acting 'irrationally'. [19]

Why it matters. A higher rate on its debt makes each new data centre cost CoreWeave more to build. [19] Traders bought nearly 200,000 contracts that pay out if its shares fall further. [20]

Dell, which makes computers and servers, fell 11% on Wednesday. [21] Barclays, a British bank, stopped recommending the shares of Dell, HPE and NetApp, three makers of data-centre equipment. [21] It said their strong sales came from a shortage of memory chips, whose higher price they passed on to customers, more than from businesses adopting AI. [21] Dell's shares had risen more than 300% this year. [21]

Why it matters. Barclays found businesses spend only about 5% of their technology budgets on AI. [21] If memory prices fall back, the sales that lifted these shares could shrink. [21]

Anthropic, the AI company that makes Claude, told possible investors its sales were $16.8 billion in the three months to September. [24][12] That was up from $11.6 billion the quarter before and $4.7 billion in the first quarter. [24] It said that, leaving out some costs, it made a profit in the quarter. [24] It plans to sell shares on the stock market, which is expected before the end of the year. [12]

Why it matters. Its sales are a gauge of whether the AI industry can pay for the buildings and chips it needs. [12] Chip and data-centre shares fell the same day on doubts about that spending. [12]

ASML, a Dutch company, is the only maker of the machines used to print the most advanced chips. [26] It raised its 2026 sales forecast to 44 to 45 billion euros, from 43 to 45 billion. [25] Its boss, Christophe Fouquet, said some customers want to order machines for 2029 and even 2030. [26] He said its planned output for 2027 and 2028 will not fully meet demand. [26]

Why it matters. Chipmakers are still planning years of AI building. [26] ASML raised its forecast on the same day that AI shares fell on worries about how that building is paid for. [7]

Fannie Mae, a big US mortgage company, now expects the 30-year fixed mortgage rate to average 7.4% in the last three months of 2026. [23] It expects 7.5% for all of 2027, up from a forecast of 6.7%. [23] The average rate was already 7.46% on Tuesday, by one daily count. [23] Signed contracts to buy existing homes were down 8.5% in September from a year earlier, Zillow, a US home-listing website, found. [23]

Why it matters. Mortgage rates loosely follow the ten-year US government borrowing rate, which has risen with oil prices and debt worries. [23] Mortgage rates also react to where lenders think inflation is going, not only to the US central bank's own rate. [23]

Morgan Stanley, a big US investment bank, made $4.91 billion in the three months to September, more than analysts expected. [27] Revenue from trading shares rose 41% to $5.8 billion, as war and rate swings made investors reshuffle what they hold. [27] Its bond trading revenue fell 7%. [29] Its wealth arm took in a record $232 billion of new client money, about half of it from people at companies that had just listed. [28]

Why it matters. Bank bosses said companies are still talking about deals, though rising bond rates may delay some. [72] Morgan Stanley's shares still fell on Wednesday. [8]

Bank of America's profit fell 17% to $6.93 billion in the three months to September. [31] It took a $1.2 billion charge for US fines over failures to report suspicious money. [31][30] Its bond trading revenue fell 17%, and total revenue of about $30 billion missed forecasts. [30] Its shares closed down 4.7%, their worst day since April 2025. [30]

Why it matters. The profit would have missed forecasts even without the fine, AP reported. [7] State Street, another US bank, fell 4.1% on weak revenue the same day. [7]

BlackRock, the world's biggest manager of other people's investments, made $1.66 billion in the three months to September. [32] That was up from $1.32 billion a year earlier. [32] The money it manages rose to $15.49 trillion, from $13.46 trillion. [32] That total sets much of what it earns in fees, so rising share prices feed into its income. [32]

Why it matters. Rising bond rates and a US central bank that has started raising again now put the share rally behind those fees in question. [32]

Larry Fink, who runs BlackRock, said on Wednesday that a halt to building data centres in the US would cause a recession. [33] Local opposition to data centres has become an issue in the 3 November midterm elections. [33] Residents object to rising power bills, water use and damage to the land. [33] Wall Street analysts estimate AI building could pass $1 trillion in 2027. [33]

Why it matters. Fink said so much of the US economy now rests on this building. [33] Torsten Slok, chief economist at Apollo, an investment firm, says AI building is drawing money, power and workers away from housing and cars. [22]

HPS, the lending arm of BlackRock, is lending about $2.8 billion to Humana, a big US health insurer, for senior-care clinics. [34] It is BlackRock's first deal in a kind of large company lending that Apollo, another big investment firm, has had to itself. [34] Apollo started that business in 2024 and made $800 million from it last year. [34]

Why it matters. Firms that invest savers' money are now lending to big companies the way banks used to. [34] Their money can go where bank deposits could not after the rules tightened following 2008. [34]

The Office of the Comptroller of the Currency, a US bank regulator, reviewed the nine biggest national banks it oversees. [36] It found that all nine used rules on 'reputation risk' with no clear standards, which could shut out customers for their politics or religion. [36][35] In one case a JPMorgan payments unit closed the accounts of sellers of Trump and conservative goods. [36] It fined no one, but may write new rules. [35]

Why it matters. Trump ordered the review after saying banks cut him off, which the banks deny. [37][36] It came a day after Bank of America's $1.2 billion fine over money-laundering checks. [37]

Netflix said on Wednesday it will cut about 1,000 jobs, 6% of its staff, mostly in product, technology, legal and human resources. [38] They are its biggest cuts since 2022. [39] Its two bosses said the business is 'strong and growing' and on track for this year's forecast. [39] Its shares are down about 25% this year, as viewers spend more time on free sites like YouTube and TikTok. [39] They have fallen 42% over the past 12 months. [40]

Why it matters. Netflix reports its quarterly results on 20 October. [38] An analyst at eMarketer, a research firm, said its subscription business may be nearing a ceiling, and it has not found another big source of income. [39]

Portugal's government chose Lufthansa, the German airline group, to buy 44.9% of TAP, Portugal's national airline. [41] Lufthansa pays 1.2 billion euros in this first stage, and the state keeps 50.1%. [41] Prime Minister Luis Montenegro said its offer was 16% higher than the rival bid from Air France-KLM, the French and Dutch airline group. [41] Lufthansa will run the airline day to day. [41]

Why it matters. The deal values TAP at about 2.55 billion euros, far above earlier estimates, the prime minister said. [41] Lufthansa also plans a 500-million-euro pilot school in Portugal. [41]

Jio Platforms, India's biggest phone network and part of Reliance Industries, will sell shares from 21 to 23 October at 1,065 to 1,119 rupees each. [42] That raises up to $3.2 billion, India's biggest share sale ever in rupees. [42][43] At the top price Jio is valued at about $108 billion, much lower than expected. [42] The sale is about 14% smaller than in its draft papers. [43]

Why it matters. Investors seem unconvinced by Jio's pitch that it is a technology company and not just a phone network. [42][44] Its shares are due to start trading on 28 October. [43]

India's cabinet approved selling 60.72% of IDBI Bank, a lender the state controls, to Fairfax Financial for 528.77 billion rupees. [45] Fairfax is a Canadian company founded by Prem Watsa, an Indian-born billionaire. [45] India's government and LIC, the state life insurer, each sell about 30% and will keep 34% between them. [45][46] It is one of the biggest foreign investments in an Indian bank. [46]

Why it matters. India's government has tried to sell IDBI since at least 2022. [46] The sale comes as the war in the Middle East strains its budget and weaker foreign inflows press on the rupee. [46]

Foreign investors have sold Indian shares for 14 trading days in a row, taking this year's outflow to a record $32.7 billion. [47] Higher US rates make markets like India's less attractive to them. [47] India's central bank raised its main rate to 5.5% last week, its first rise in nearly four years. [48] PIMCO, a big US bond investor, expects about 0.75 percentage points of rises in all, less than markets are betting on. [48]

Why it matters. PIMCO said conditions at home were the main reason India raised rates, but US rate rises and steadying the rupee also played a part. [48]

The Securities and Exchange Board of India, the market regulator, proposed new rules for small firms that sell shares to the public. [49] A firm would need average yearly operating profit of 30 million rupees over three years, up from 10 million in two of the last three. [49] A firm that fails the test could still list if big institutions take at least 75% of the shares on offer. [49] Comments are due by 4 November. [49]

Why it matters. Big investors would get more say over which small firms list. [49] They could also sell a larger part of their own holdings in a listing. [49]

India's market regulator confirmed its curbs on Rajesh Exports, an Indian gold company with a Swiss subsidiary called Valcambi, and on its managing director, Rajesh Mehta. [50] Mehta may not trade the company's shares until further notice. [50] The regulator alleges that about 15 trillion rupees of revenue was misrepresented between 2020-21 and 2024-25, 99.8% of what its subsidiaries reported. [50] It says this is not yet a final finding. [50]

Why it matters. The regulator said the gap raises doubts about whether the company's reported sales can be checked or trusted. [50] It told a new forensic auditor to finish quickly. [50]

Bharat Heavy Electricals, a state-owned Indian engineering company, made a profit of 8.1 billion rupees in the three months to September. [51] That was up 120% from 3.68 billion rupees a year earlier. [51] Its revenue rose 23.8% to 93 billion rupees. [51] Its shares rose 5% to a record high on Wednesday. [51]

Why it matters. Its board also approved about 5 billion rupees for new factory space to make equipment for nuclear power plants and plants that burn fuel. [51]

Kristalina Georgieva, head of the International Monetary Fund, said in Bangkok that the US cannot grow its way out of its debt. [52] She said tax or spending changes are needed. [52][53] US national debt is more than $40 trillion. [53] She called the US and European countries the 'worst offenders' on debt, and said China should rely less on exports. [52]

Why it matters. High borrowing rates in rich countries spill over to poor countries that already have to borrow less. [52] Rodrigo Valdes, who runs the IMF's budget department, said fiscal risks are rising and the response is 'largely absent'. [53]

Ed Miliband, Britain's foreign secretary, was due to tell a meeting in Bangkok on Wednesday that the world's financial system is failing developing countries on debt. [54] He planned to ask the World Bank and other development banks to use their own finances to let those countries repay over longer periods, at better rates. [54] He pointed to the 2005 Gleneagles summit, which followed the Make Poverty History campaign. [54]

Why it matters. Nearly four in five African countries spend more on interest than on health or education, the World Bank said last week. [55] Higher rates in rich countries make those payments bigger. [52]

The IMF raised its 2026 growth forecast for sub-Saharan Africa to 4.5%, from 4.3% in July. [55] That keeps the region among the fastest-growing in the world. [55] Nigeria, Africa's biggest oil producer, got a higher forecast of 4.2%. [55] South Africa, the biggest economy, is expected to grow more than four times slower than the region. [55]

Why it matters. Oil sellers like Nigeria earn more from the war's high prices. [55] Countries that import fuel pay more for it and grow more slowly. [55]

Malawi began a nationwide crackdown on fuel hoarders and black-market sellers. [56] Truckers have queued for up to a week, and bus fares have doubled on some routes. [56] The country lacks the dollars to buy fuel abroad, and its central bank has sold gold to pay suppliers. [56] Pump prices are above $3 a litre, among the highest in Africa. [56]

Why it matters. Malawi has gone back to the IMF for a rescue loan. [56] It shows how oil above $100 a barrel hits poor countries that import their fuel and have little in reserve. [56]

Saudi Arabia's Public Investment Fund, the state's main investment fund, plans to drop five new stadiums it proposed for the 2034 men's football World Cup. [57] People familiar with the plan told this to Semafor, a news site. [57] It would build three new ones instead, leaving 10 stadiums for the tournament. [57] One dropped site is at NEOM, a desert mega-project where work on its giant building has largely stopped. [57] The plan could still change. [57]

Why it matters. The fund is cutting spending on some of its biggest projects at home. [57] Several of the dropped stadiums were tied to property projects that have been halted or slowed. [57]

The International Energy Agency said on Wednesday that the world's diesel shortage will last into the second half of 2027. [58] World diesel exports fell by 700,000 barrels a day in September from a year earlier, as supply from Russia and the Middle East dropped. [58] Wholesale diesel reached record prices of about $220 a barrel in Europe and the US. [58] It has more than doubled in price since the start of 2026. [60]

Why it matters. The agency said record diesel prices are raising the cost of goods and hurting people's real incomes. [59] Refiners outside the war zone are set for record profits from the shortage. [59]

Brent crude, the main world oil price, fell $1.39 to $104.67 a barrel early on Thursday. [61] The US is considering easing sanctions on 'shadow fleet' tankers that carried Russian, Iranian and Venezuelan oil, to cut shipping costs. [61] Gulf oil exports recovered to about 75% of pre-war levels in September, the IEA said. [61] Russia's crude output rose by 65,000 barrels a day in September, to 8.43 million. [61]

Why it matters. US crude stocks fell by 11.1 million barrels in a week, far more than expected, yet prices barely rose. [61] Haitong Futures, a Chinese broker, said that shows investors are wary of chasing prices higher. [61]