AI's Borrowers Paid the Most | Oil Producers Hit Records | A Hike Bet Tripled, Then Faded | Strive's Warrants Ran Out

Stocks fell, and AI's heaviest borrowers fell hardest.

The S&P 500 fell 1.1%, to about 7,720, and the Nasdaq Composite lost 1.9%. The Dow ended nearly flat. Health care led the 11 sectors, and technology trailed.

CoreWeave (CRWV) fell 15.5%, about five times the roughly 3% decline at Nvidia (NVDA).

CoreWeave's notes due 2032 yielded near 15%, CNBC reported, far above their 9.625% coupon. Oracle (ORCL) lost 8.8%, and Dell (DELL) fell 11.4% after Barclays cut its rating.

Higher rates help one half of State Street and hurt the other. State Street (STT) beat FMP's profit consensus by a cent. Revenue of about $4.0 billion fell short of the $4.03 billion expected.

Custody assets hit a record $59.2 trillion. The stock fell as much as 10% and closed down more than 4%. BlackRock (BLK) closed up less than 1%.

Taiwan Semiconductor (TSM) reports Thursday.

The Lenders Set the Price

Bond investors now demand far higher yields on CoreWeave's debt, and its shares fell much harder than its chip supplier's. Oracle and Dell joined the slide. State Street's custody record could not hold its stock up.

The IEA counted returning barrels while the Gulf attacks kept coming.

Oil producers' shares set records on the day the IEA counted 2.5 million barrels of returning supply. Exxon Mobil (XOM) rose 1.7% and Chevron (CVX) 2%, each touching an all-time high.

World supply rose 2.5 million barrels a day in September, "driven by Gulf producers," the IEA said. "Renewed attacks in the Gulf leave the recovery fragile," it added.

A container ship sank near Hormuz. A Polymarket contract held at 12.5 cents. It pays if Washington announces an end to its blockade of Iran by Oct. 31.

Singapore's port authority said the GFS Pride was reportedly struck by a projectile and sank. All 21 crew were evacuated. Iran's Revolutionary Guards said a container ship hit a mine on an "unauthorized" route.

Three people with direct knowledge told Reuters that Aramco's Dhahran headquarters suffered extensive damage. Saudi Arabia's energy ministry has called it a "limited fire."

Brent gave back most of an early gain and was near $106 late in the day, up about 0.3%.

Barrels Back, Risk Still Priced

The IEA counted barrels coming back from the Gulf. Producers' shares set records anyway, as the attacks went on. A ship sank, and the blockade contract held still.

The Fed's own survey found prices rising at least moderately almost everywhere. Traders still sold back much of their hike bet.

Core consumer prices rose 0.3% in September, above forecasts, the Labor Department said Wednesday morning.

Prices ran at a moderate pace or faster in 11 of 12 Fed districts. Growth did in only two. The Beige Book, gathered through Oct. 5, called price growth robust in three districts.

Kalshi's October hike contract jumped from 18 cents to 55 within 40 minutes. The jump followed the 8:30 a.m. report, and the contract traded at 35 cents by 1:46 p.m.

From mid-afternoon it traded between 30 and 33 cents, Kalshi data show. It stood at 33 cents after the stock market closed.

"I don't feel any urgency for taking further action at this point," the Fed's Michelle Bowman said in Bangkok. Citi now expects a December hike.

Producer prices and retail sales arrive Thursday. The Fed meets Oct. 27-28.

Broad Prices, Cooler Bets

The survey shows widespread price pressure, yet the October contract gave back most of its jump. Bowman sees no urgency, and Citi now looks to December. Thursday's data come next.

Public buyers paid far more than Berkshire did, and Fed staff measured how little retail credit funds hold in liquid assets.

Berkshire agreed to pay about a 13% discount for more Bending Spoons. It agreed to buy 10 million shares at $33 each, or $330 million. That would lift its stake to about 4% once the placement closes.

Bending Spoons (BSP) closed up 41%, at $53.46. The placement is subject to customary closing conditions.

Fed staff mapped retail private-credit funds. Non-traded business development companies held 93.4% of their portfolios in private credit. Their average leverage was 0.90 times equity.

They kept just 0.2% in short-term liquid assets. Interval funds have moved to 49.5% private credit, from about 20%.

The data run through the end of 2025, and the views are the authors' own. Stress in these funds shows up as redemption queues rather than outflows, the note says.

The Discount and the Queue

The block buyer got the discount, and everyone else paid up. In retail credit funds, the vehicles with the most leverage hold the least in liquid assets, and exits run through queues.

Listed crypto companies fell much harder than the coin itself.

Bitcoin traded near $81,800 after the stock close, and ether near $2,420.

Bitcoin slipped 2%. The median crypto stock fell about four times as far. Coinbase (COIN) lost 4.9% and Strategy (MSTR) 5.9%.

Robinhood (HOOD) fell 8.5% and MARA (MARA) 9.7%. IREN (IREN) dropped 12.2%, while the iShares Bitcoin Trust (IBIT) slipped 1.9%.

Strive's warrants are done. It bought 2,822 bitcoin and edged past MARA by 18 coins. A filing shows $369.2 million of expected gross proceeds and about $235 million of bitcoin bought.

No traditional warrants from its private placement remain outstanding. Strive (ASST) fell 10.5%, and its SATA preferred closed near $97.67, below $100.

K33 tallied Strategy's annual preferred dividend bill. STRC's expansion this year added about $725 million to it, the firm estimated. "Was the pref model a mistake? We believe the answer to that question is yes," it wrote.

The Wrapper Took the Hit

Funding for coin buyers got harder on two fronts. Strive has no traditional warrants left, and its preferred trades below par. K33 called Strategy's preferred model a mistake.

Wednesday showed what it costs to borrow.

CoreWeave's bonds yield near 15%. Strive has run through its warrants, and its preferred trades below $100. Non-traded BDCs held 0.2% in liquid assets at the end of last year.

Kalshi's hike contract gave back most of its morning jump. Producer prices, retail sales and Taiwan Semiconductor's results come Thursday.