Oracle invokes force majeure; 10-year tops 5% as curve steepens

🔴 MACRO SNAPSHOT

• The 10-year Treasury sits at 5.11% and the 2-year at 4.85%, with the 10y-2y spread at 0.31pp — the post-hike repricing extended overnight, per global bond-market coverage, with yields at multi-decade highs and the dollar firmer against majors. Fed funds remains 3.75%-4.00%.
• On today's calendar, per schedule coverage: August Durable Goods Orders and weekly Initial Jobless Claims, both 8:30 AM ET.
• The Senate voted 49-50 to reject the Iran war-powers resolution, preserving strike authority, per overnight coverage — while reports of talks on lifting tanker blockades in Hormuz keep draining crude's supply premium.
• NYSE open today; closed tomorrow (weekend), next session Monday.

🔄 SECTOR ROTATION

Winners: Communication Services +1.27%, Health Care +0.63%, Energy +0.37%.

Losers: Materials -1.19%, Utilities -0.98%, Consumer Staples -0.89%, Industrials -0.75%, Real Estate -0.45%, Technology -0.32%, Consumer Discretionary -0.30%, Financials -0.02%.

Defensives led while rate-sensitive and cyclical groups lagged — the exact pattern a 5%+ 10-year produces. Energy green despite the crude pullback is the outlier worth noting.

📈 BONDS

• 10-year at 5.11% (+0.15), 2-year at 4.85% (+0.14), 10y-2y at 0.31pp (+0.05).
• The curve is steepening from elevated levels — bear-steepening that punishes long-duration and keeps the pressure on homebuilders, utilities and real estate.

🛢️ COMMODITIES

• WTI at $96.41/bbl (-0.56). Gold $4,264.89/oz (-0.55). Silver $63.59/oz (-1.11).
• Crude is deflating its geopolitical premium on diplomacy, per overnight coverage, but the Senate's war-powers vote keeps the tail risk alive.

💎 CRYPTO

• Bitcoin $84,385.46 (+0.01%), Ethereum $2,687.28 (+0.13%) — flat, no obvious catalyst in the data.

📊 EARNINGS MOVERS

• COST: EPS $6.75 vs $6.54 est; revenue $93.87B vs $94.97B est — margin strength, soft top line.
• Upcoming: CCL Sep 29 (est $1.35), NKE Oct 1 (est $0.4379).

🎯 NOTABLE SIGNALS

• AMD crossed the $1 trillion market cap on AI accelerator deals with OpenAI, Meta, Anthropic, Oracle and Microsoft — but its $6.7B quarterly data center revenue lags Nvidia's $89B, at a 158 P/E 2.
• BlackBerry rose 4.18% on a Q2 beat (26% revenue growth, record QNX sales) and raised FY2027 guidance — though it trades at 46x forward earnings 45.
• Viking Therapeutics surged 35% on positive maintenance-dosing data for GLP-1 candidate VK2735 13.
• ArcelorMittal cannot safely restart Kryvyi Rih after missile strikes; ~$1B impairment coming 25.

💡 MY TAKE

Yesterday split the AI capex story in two: Oracle's Project Jupiter force majeure and record CDS mark the first execution and financing crack in the buildout 4367, while Vicor doubling its Q3 growth guidance on power-delivery licensing shows demand itself is still compounding 14. The market's answer was Technology -0.32% and defensives leading — a rotation, not a rout. With the 10-year above 5% and the curve steepening, the bond market is doing the Fed's work; rate-sensitive sectors stay the pressure point, and Berkshire's $212M Lennar buy 12 is the one prominent bet against that tide. If crude keeps sliding on Hormuz diplomacy, the energy bid (+0.37% yesterday) is the fragile green on the board.

Sector	Lean	Rationale
Communication Services	🟢	Best performer (+1.27%) as defensives led the rate-driven rotation
Health Care	🟢	+0.63%, second-best defensive bid
Energy	🟡	Green despite crude's slide; diplomacy premium drain vs. strike-authority tail risk
Technology	🟡	Oracle's force majeure vs. Vicor's guidance raise — the buildout story is splitting 4314
Utilities	🔴	-0.98%, rate-sensitive and duration-heavy with the 10-year at 5.11%
Real Estate	🔴	-0.45% with the curve bear-steepening
Materials	🔴	Worst sector (-1.19%), compounded by ArcelorMittal's Kryvyi Rih shutdown 25
Homebuilders	🟡	Rate squeeze intact, but Berkshire's 81% stake increase in LEN is a live counter-signal 12

Bottom Line: A 5%+ 10-year and the first execution crack in AI infrastructure are running the tape. Defensives are the only clean bid; the open question is whether Oracle's stumble stays idiosyncratic or spreads through the data center chain.

Signal over noise.

👁️ NAMES TO WATCH TODAY

ORCL (Oracle) — Force majeure on Project Jupiter, ~5% drop, record CDS 4367; watch whether the data center delay stays project-specific or spreads to peers.

VICR (Vicor) — Q3 sequential growth guidance doubled to 20%+ on VPD licensing royalties from four OEMs/hyperscalers 14; watch whether licensing momentum extends.

LEN (Lennar) — Berkshire bought $212M in three days, stake up 81% this quarter 12; watch whether the counter-bet steadies the builder under 5%+ rates.

AMD (AMD) — Crossed $1T cap, but $6.7B quarterly data center revenue vs Nvidia's $89B at 158 P/E 2; watch whether the valuation debate cools the run.

NVDA (Nvidia) — $89B quarterly data center revenue anchors the capex story Oracle's stumble is testing 2; watch hyperscaler spending signals.

COST (Costco) — EPS $6.75 vs $6.54 est but revenue $93.87B missed $94.97B; watch how margin strength is weighed against the soft top line.

SFM (Sprouts Farmers Market) — Burry lifted it to a full position after a 62% decline from its 2025 high, at 12x 2026 earnings 9; watch whether margins hold under inflation pressure.

VKTX (Viking Therapeutics) — Up 35% on VK2735 maintenance-dosing data in the $100B weight-loss market 13; watch next readouts against Lilly and Novo.

BB (BlackBerry) — +4.18% on a Q2 beat, record QNX sales, raised FY27 guidance 45; watch whether the 46x forward multiple draws scrutiny.

MT (ArcelorMittal) — Kryvyi Rih cannot safely restart; ~$1B impairment coming 25; watch talks with Ukraine over the plant's future.