US EQUITY OPEN: Indices hit on hot CPI and hawkish Waller

OPEN: US indices opened in the red, weighed on by hawkish remarks from Fed’s Waller and the subsequent hotter-than-expected US CPI report. Before the data, Waller said a half-point rate hike may be needed in December if October core CPI came in around 0.3% or higher (which it did), though he would support a quarter-point hike even if CPI improves, adding that further tightening will be needed. After the CPI release, in which both headline and core M/M figures topped consensus, a broad-based hawkish reaction followed. Treasuries, US equity futures and spot gold fell, while the Dollar gained. Money markets now fully price a 25bps hike in December, with a c. 10% probability of a 50bps move. Sectors are broadly in the red, with Energy and Technology the laggards. Energy is weighed on by weakness in the crude complex amid continued constructive rhetoric between the US and Iran. In Tech, Nvidia is lower again, pressured by reports that the alleged Chinese spy linked to CEO Huang facilitated the sale of at least USD 7.5bln in chips to China. In FX, the Aussie is the underperformer, weighed on by the risk tone and overnight Chinese data. Looking ahead, Fed’s Logan, Schmid, Bowman and Paulson are scheduled, alongside the US 10yr auction and the EIA STEO. After-hours, weekly private inventory data and CoreWeave earnings are due. STOCK SPECIFICS: Nvidia (NVDA): CEO's affair with alleged Chinese spy facilitated the sale of at least $7.5bln in chips to China Anthropic targets a modest $1tln market value in its IPO Lam Research (LRCX), Micron Technology (MU), Nvidia (NVDA): Have been removed from the US 1 list at BofA Take-Two Interactive (TTWO): Narrower-than-exp. Q loss & unprecedented pre-orders for GTA VI Lucid Group (LCID): Deeper loss per shr. than exp. & rev. light Rocket Lab (RKLB): Profit light & sees larger-than-exp. next Q adj. EBITDA loss Hims & Hers Health (HIMS): Surprise Q loss, rev. missed & downgraded FY guidance