HAPPY THURSDAY TO THE STREET.
Once upon a time, cloud computing was a moonshot. Now, it’s basically just Big Tech plumbing.
Bank of America $BAC ( ▲ 0.87% ) believes quantum computing could follow the same arc, growing from $300M today to $4B by 2030. That may sound small next to AI, but it’s early innings.
Pure-plays like IonQ $IONQ ( ▼ 3.04% ), Rigetti $RGTI ( ▼ 2.31% ), and D-Wave $QBTS ( ▲ 2.66% )have already seen eye-popping runs this year, while IBM $IBM ( ▲ 2.28% ) is chasing error-free machines. Patient capital could get rewarded — if you can stomach volatility.
🟥 | US stocks fell for a third straight day as ongoing Oracle weakness dragged the major indexes lower.
📈 | One Notable Gainer: Intel $INTC ( ▲ 5.94% ) rose on reports that the company is in early talks with Apple $AAPL ( ▼ 0.02% ) about a potential investment.
📉 | One Notable Decliner: Oracle $ORCL ( ▼ 2.09% ) slumped after Rothschild & Co Redburn began coverage with a Sell rating, warning of overestimated cloud revenues.
Finally, read to the end for the debt breakdown they don’t teach you in school…
— Brooks & Cas
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STOCK HEATMAPS
S&P 500 Heatmap. Credit: Finviz
All Stock Heatmap. Credit: Finviz
Global ADR snapshot. Credit: Finviz
Market Movers
CARMAX, OPENDOOR, STITCH FIX
$KMX ( ▲ 0.99% ) CarMax stock plummets following ‘challenging’ quarter (CNBC)
$OPEN ( ▼ 2.75% ) Opendoor Stock Pops as Jane Street Discloses $61 Million Stake In Real Estate Giant (GuruFocus)
$SFIX ( ▼ 0.11% ) Stitch Fix surrenders post-earnings gains as shrinking user base, compressed margins spook investors (Seeking Alpha)
$QURE ( ▲ 0.13% ) UniQure extends eye-watering rally ahead of planned $200 mln share offering (Reuters)
$RIG ( ▲ 0.48% ) Transocean Stock Drops After Announcing Upsized Share Offering At A Discount (Stockwits)
OVERHEARD ON THE STREET
CBS: Amazon $AMZN ( ▲ 0.95% ) will pay $2.5B to settle FTC claims it misled Prime members, including $1.5B in customer refunds.
MarketWatch: Initial jobless claims fell by 14K to 218K last week, the lowest level since mid-July.
CNBC: Disney $DIS ( ▲ 0.05% ), Apple $AAPL ( ▼ 0.02% ), Netflix $NFLX ( ▲ 0.14% ) and other streamers are all hiking prices.
Axios: Starbucks $SBUX ( ▼ 0.5% ) will cut 900 jobs and close underperforming stores in a $1B restructuring plan.
WSJ: Microsoft $MSFT ( ▲ 0.51% ) disabled some Israeli Defense Ministry cloud services after an internal probe found evidence of Gaza surveillance.
Tomorrow's Trade Idea, Today
WORLD’S MOST VALUABLE?
Big Call on Alphabet
The world may soon have a new largest company, according to MoffettNathanson: Alphabet $GOOGL ( ▲ 0.84% ).
The firm lifted its price target to $295 from $230 — nearly 20% above Thursday’s close — and kept a Buy rating. Analyst Michael Nathanson wrote that a mix of market leadership, diversification, and scale could allow Alphabet to emerge as the defining winner of the so-called Generative AI Era.
Nathanson emphasized that this is not a reflection of Alphabet’s current market cap, but a projection of what the company “should rightly be considered” over time.
AI at the Core
The bull case leans heavily on AI.
MoffettNathanson highlighted Google Cloud’s momentum in storing and processing massive datasets for model training, noting its growth is outpacing peers. The bank also cited Alphabet’s edge in multimodal search, which integrates text, images, and voice into results.
That advantage, coupled with differentiated infrastructure and access to third-party models, has resonated with AI startups. A recent court win, where a judge declined to impose new restrictions on Google’s search business, further solidified its position.
Street Split on Scale
Alphabet shares have surged 44% in the past three months. The company is now rated a Buy or Strong Buy by most analysts, though consensus price targets hover closer to $236. MoffettNathanson’s $295 call stands out as one of the highest on Wall Street.
Whether Alphabet can turn AI investments into durable earnings growth remains an open question. Assuming it will crack the code, BoA believes the biggest AI winner (and company) won’t be today’s leader, but tomorrow’s.
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ON OUR RADAR
Fortune: Elon Musk sold Grok AI to the US government for $0.42 per agency, securing an 18-month federal contract.
CNBC: Breeze Airways will launch its first international flights in 2026, starting routes to Mexico, Jamaica, and the Dominican Republic.
MarketWatch: Starting in 2026, workers over 50 earning more than $145K must make 401(k) catch-up contributions post-tax into Roth accounts.
WSJ: The EU has opened an antitrust probe into SAP $SAP ( ▲ 0.55% ) over claims it forces customers to buy its own support services.
GlobalData: The FDA issued draft guidance on Sept. 24 outlining innovative trial designs for cell and gene therapies in small populations.
STREET TWEET
IOU → CDO → WTF.
This explains better than any chart how Wall Street turns your liabilities into their playground — and business model.
WEDNESDAY’S POLL RESULTS
Are you bullish or bearish on Brookfield $BN ( ▲ 0.28% ) over the next 12 months?
▇▇▇▇▇▇ 🐂 Bullish
▇▇▇▇▇▇ 🐻 Bearish
And, in response, you said:
🐂 Bullish — “Have owned various Brookfield entities over many years. Great management... Some convoluted cross-ownership but positive wealth builders.”
🐻 Bearish — “They'll get there. But a year is too short a timeframe for this type of robot to be made useful enough to have much of a market.”