The Week Ahead Of Us 🔍
Welcome back!
While there is a lot to be excited about, especially with AI advancements, the dramatic rise in rates isn’t spilling over to the equity market yet - and that should cause you to pause.
As a Credit guy, seeing spreads widen out is a crucial, negative development because it grinds to a halt some of the financing activity plus disrupts the DCF formula of high-growth, high-multiple stocks. CCC HY debt is now running at a 16% effective yield, compared to 12.5% at the beginning of the year; while the broader HY market at 7.8% compares to 6.55% from January. When you start getting cracks in the financing markets, then it usually drives a corresponding equity selloff. Futures are only down slightly, so the US market is broadly indifferent at the moment.
Btw, We’re running a survey on the State of AI in Finance. And we already have more submissions than our 2Q26 edition - we are polling finance professionals on how they’re using AI at work. We expect to aggregate hundreds of submissions and to provide great insights via our Buyside Hub platform. Contributing to the report gets you Buyside Hub access, plus enters you into a gift card raffle. You can contribute here so you can access the report when its released.
Let’s get into it.
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Here’s a look at earnings this week.
Monday: Grifols, Jefferies Financial Group, Vail Resorts
Tuesday: Carnival Corporation, CarMax, Concentrix
Wednesday: Micron, Conagra, Jabil, FactSet, Cal-Maine, ConAgra
Thursday: Accenture, Nike, McCormick, Acuity
Here’s a look at economic data this week (estimates are in quotations).
Monday: FRB New York President John Williams begins two-day regional visit to Western New York
Tuesday: Case-Shiller Home Px Index, Conference Bd - Consumer Confidence (89.2), Job Openings & Labor Turnover Survey (7.2M)
Wednesday: ADP National Employment Report, 3rd estimate GDP (1.5%), Advance U.S. Trade Balance in Goods, Wholesale Inventories, Retail Inventories, Personal Income M/M% (0.4%), Consumer Spending M/M% (0.8%), PCE Price Idx M/M% (0.3%), PCE Price Idx Y/Y% (3.6%), PCE Core Price Idx M/M% (0.3%), PCE Core Price Idx Y/Y% (3.2%), Chicago Business Barometer ISM-Chicago Business Survey - Chicago PMI (52)
Thursday: Weekly Jobless Claims (200k), US Manufacturing PMI, ISM Report On Business Manufacturing PMI (54.8), Construction Spending (0.1%)
Friday: Employment Report (84k), Unemployment Rate (4.1%), Avg Hourly Earnings M/M% (0.3%), Avg Hourly Earnings Y/Y%, Factory Orders (0.2%)
On The Move 📈 📉
People Incorporated $PPLI ( ▲ 11.33% ) jumped after MGM Resorts $MGM ( ▼ 3.3% ) discussed making a bid for the company. The news came just days after People withdrew its own offer to buy MGM, in which it holds a roughly 27% stake.
Cybersecurity stocks $RPD ( ▼ 9.57% ), $S ( ▼ 6.67% ), $QLYS ( ▼ 5.75% ), $OKTA ( ▼ 5.54% ), and $PANW ( ▼ 3.89% ) sold off as investors questioned whether the sector’s AI-driven rally has pushed valuations too far.
Bloom Energy $BE ( ▲ 8.27% ) rallied after confirming Oracle remains committed to its roughly 2.4 GW fuel cell contract for Project Jupiter.
Chip stocks $PENG ( ▲ 5.92% ) and $ON ( ▲ 5.54% ) extended a multi-day rally as Meta’s Muse agent showed AI demand expanding from accelerators to server chips.
Dell $DELL ( ▲ 5.01% ) climbed after launching a $999 XPS Googlebook built around Gemini and Android phone integration. The laptop will be available in October.
Booking Holdings $BKNG ( ▲ 4.16% ) rose as investors chewed on whether the platform would actually be a beneficiary of agentic search.
Twilio $TWLO ( ▼ 7.96% ) fell after HSBC downgraded to Reduce with a $211 PT, warning that the market is overestimating its upside from Meta’s Muse.
McGraw Hill $MH ( ▼ 7.01% ) slid after announcing a $500M senior secured notes offering and an $830M term loan to refinance existing debt. Proceeds will go toward redeeming its 5.75% notes due 2028 and refinancing its current term loan.
IPO Roundup 📍
Oura’s IPO is ~4x oversubscribed as the smart ring maker seeks up to $2.2B at a ~$14.1B valuation. The deal is set to price Sept. 29.
Adarx Pharmaceuticals $ADRX ( ▲ 13.82% ) rose in its debut after raising $446.3M in an upsized IPO priced at $17. The San Diego biotech, which develops siRNA drugs for diseases from Alzheimer’s to obesity, now has a ~$2.06B market value.
City Therapeutics filed for a US IPO to fund early-stage trials of RNAi drugs for blood clotting disorders and Stargardt disease, an inherited eye disease.
Today’s Headlines 📖🍿
AI labs including Anthropic and OpenAI are investigating tens of thousands of incidents involving rogue AI behavior, including sandbox escapes, external system hacking, and coding assistants deleting home directories, disks, and repositories.
SNL is back, and they kicked off the new season with an impersonation of Dario Amodei. You can watch it here.
J.P. Morgan chief U.S. economist Michael Feroli expects another quarter-point Fed raise in December. “Inflation continues to look supply-shock-driven, and as such we don’t foresee a protracted hiking cycle extending into next year.”
PIMCO faces an 85% markdown for a $368M CMBS from a $471 appraisal to a $70M sale price tied to Philadelphia’s Centre Square office complex, with the senior slice projected for a 44-cent-on-the-dollar recovery and a total wipeout for seven lower-ranking tranches.
Wall Street departures:
Blackstone’s global head of private equity, Joseph Baratta, is preparing to leave the firm. Under his leadership, the business grew from roughly $50B in AUM to $454B as of June.
Morgan Stanley’s co-head of public finance investment banking, Zach Solomon, is leaving to join TD Securities, which has been expanding its municipal bond business.
Olive oil brand Graza has tapped Lazard for a sale of up to $600M, implying 20x its $30M EBITDA and 4.2x 2026 gross sales. This marks a 2.5x increase from the $240M valuation the company carried in 2025.
Manchester City has been found guilty of 114 counts of 115 Premier League financial charges, covering inaccurate reporting of player and coach payments, breaches of UEFA financial fair play rules, and 35 counts of failing to cooperate with investigators.
Apollo chief economist Torsten Slok warns of an agentic bank run. AI assistants could soon sweep household cash automatically into accounts paying 3.3% to 5%, instead of the 0.1% national average on checking accounts.
Leslie’s is preparing to file for Chapter 11 bankruptcy, expecting to hand control to lenders in exchange for converting their $750M term loan into equity. The pool supplies company saw demand wither away after a big pandemic-driven boom, closing 10% of its 943 locations as part of the filing.
J.P. Morgan says bond and stock markets are reading economic growth in very different ways. Bond investors are increasingly focused on deficits, while equity investors remain fixated on corporate earnings and AI innovation. That divergence might eventually come to a head.
Larry Ellison pledged $9.2B more in Oracle shares as collateral for personal loans. He is helping his son David’s Paramount Skydance acquire Warner Bros. Discovery in a transaction valued at $111B.
Morgan Stanley says China’s Industry 5.0 strategy could unlock $12T in investment over the next decade. The largest opportunities span factory upgrades, automation, robotics, semiconductors and industrial software.
Private equity dealmakers are missing out on big windfalls as buyout firms hold on to companies longer. Unsold investments at Blackstone, KKR, and Carlyle would generate almost $17B of carry if realized.
M&A Transactions💭
Enjie New Material, manufacturer of lithium battery separators, has reached a definitive agreement to be acquired for CNY 1.5B by Shanghai Energy Materials. EV/Net Income was 5.83x and EV/Revenue was 1.27x.
Clinical Ink, developer of a purpose-built data capture platform, was acquired for $400.0M by Ardan Equity and GI Partners.
Genuine Cable Group, distributor of wire, cable, and related products, has reached a definitive agreement to be acquired for $1.4B by Rexel (PAR: RXL). EV/Revenue was 1.27x. J.P. Morgan and Solomon Partners advised on the sale.
Private Placement Transactions💭
Corgi, the controversial AI insurance company has quietly raised $64mm in financing that values the company at $5 Billion.
Autonomous Solutions, manufacturer of industrial vehicle automation systems, received $225.0M of financing from SoftBank Group (TKS: 9984).
Harvey, developer of a legal technology platform, raised $600.3M of Series H venture funding led by Lightspeed Venture Partners and Diffusion ONE at a pre-money valuation of $14.95B.
Parallax, developer of gas-fired turbines, raised $117.0M of venture funding led by Lux Capital, Founders Fund, Definition, Greylock, General Catalyst, Eclipse Capital.
Restructuring Filings💭
UPG Enterprises
Type: Chapter 11, Debt: Not yet disclosed
What happened: Metals and manufacturing group UPG and numerous affiliates filed Sept. 22–23 in Illinois and are being jointly administered.
Yardbird Group
Type: Chapter 11, Debt: $10M–$50M liabilities
What happened: Restaurant operator behind Yardbird filed Sept. 21 with 10 affiliates and obtained interim DIP financing.
HouseCanary
Type: Chapter 11, Debt: Up to $100M–$500M at certain affiliates
What happened: Real-estate analytics company and four affiliates filed Sept. 22 in New Jersey.
Restructuring Updates💭
Brightline
Type: Financial restructuring, Debt: Multi-billion-dollar capital structure
What happened: Reached a restructuring agreement Sept. 25 that includes $490M of new financing and significant deleveraging while keeping Miami-Orlando service operating normally.
Brightspeed
Type: Restructuring / financing watch, Debt: ~$11B
What happened: Remains in creditor negotiations and is seeking additional financing following its earlier distressed debt exchange.
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Obviously, none of this constitutes financial or investment advice. Today’s Paid Partner is Cognitive Credit.