• Stocks: The Nasdaq fell as much as 3.7% intraday as a tech selloff continued, with investors pulling out of the AI trade and into safer areas of the market.
• Bonds: 10-year Treasury yields remained under 5% on yesterday’s strong GDP data, and the Treasury Department also announced a new Series I bond rate of 5.51% for the next six months.
• Crypto: Bitcoin and other cryptocurrency prices plunged thanks to a $6.3 billion hack at Binance, making it the largest cyberheist in history (more on that below).

Earnings

Illustration: Morning Brew Inc., Photo: Adobe Stock

It was a gusher of a quarter for US oil giants Chevron and ExxonMobil. But forget “drill, baby, drill”—the real money was in refine, baby, refine.

Reporting earnings today, both companies blew past expectations on both top and bottom lines: Chevron’s net income surged nearly 200% in Q3 to $9.9 billion, or $5.06 a share, while ExxonMobil’s quarterly profits doubled to $15.4 billion, or $3.72 a share.

These bumper profits didn’t come from the usual cash cow of pumping crude. Upstream production has actually dipped slightly at both companies as the Middle East conflict disrupts drilling operations. But in a surprise benefit, attacks by Ukraine and Iran have also knocked out refineries in Russia and the Middle East—giving US companies an opening to pick up the slack and ramp up their own refinery activity at home.

The numbers say it all: Chevron’s US refineries have been firing on nearly all cylinders, running at 98% capacity and processing a record 1.09 million barrels of crude per day. That helped send refining profits soaring 300% year-over-year to $4.9 billion—the company’s biggest downstream payday in six years.

Similarly, Exxon’s Gulf Coast refineries ran at 100% capacity and produced their second-highest volume of diesel on record. Refining profits of $7.2 billion even edged out the $7.1 billion it made by extracting oil and gas from the ground—a first in the same six-year time frame.

This surprising news gassed both companies’ stocks today, with Chevron up 1.75% and Exxon up 2.25%.

Pain at the pump

Wall Street may be impressed, but Main Street not so much.

High gas prices have become a political pothole ahead of Tuesday’s midterm elections. So rather than laugh all the way to the bank, Exxon CFO Neil Hansen put it differently. “It’s important to acknowledge that these higher fuel prices put real pressure on families and businesses,” he told Reuters. Exxon hopes to ease it by pulling “every lever that’s available to us to increase supply.”

Chevron and Exxon are both plowing some of their windfall back into refining their refineries. Exxon expects those investments to boost US distillate production of diesel and other fuels by another 100,000 barrels per day, though it didn’t say when. Chevron also sees room to squeeze more out of its Gulf Coast facilities, including a potential 7% capacity boost by the end of the decade, CFO Eimear Bonner told Reuters.

Both firms have also used their profits to knock out debt, with Exxon cutting its IOUs by $8 billion and Chevron by nearly $14 billion. Even though business is booming now, the good times may not last: Bonner said Brent crude, the global benchmark, bounced between $68 and $132 per barrel last quarter, underscoring just how quickly the energy market can turn and veer into uncharted territory.—JD

      

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Stocks

🟢 What’s up

• FedEx Freight climbed 14.91% thanks to an upbeat fourth-quarter outlook that signaled improving demand for freight transportation.
• Rivian surged 6.20% on stronger-than-expected quarterly results and a raised full-year vehicle delivery forecast.
• Regeneron Pharmaceuticals rallied 13.33% as record sales of its Dupixent, EYLEA HD, and Libtayo drugs fueled an earnings beat.
• Mondelēz International gained 3.85% following better-than-expected quarterly earnings, helped by cost-cutting efforts.
• AstraZeneca rose 6.78% on strong cancer drug sales and plans for a $1.5 billion cost-savings program alongside an earnings beat.

🔴 What’s down

• Sandisk fell 13.54% despite beating quarterly earnings and revenue expectations and announcing an 8-for-1 stock split.
• Nvidia dropped 4.15% as Amazon’s massive AI spending and deteriorating cash flow fueled a broader selloff in chip stocks.
• Reddit plunged 29.34% as Google’s AI search features drove down referral traffic, raising fears that its daily active users could decline by double digits this quarter.
• Twilio sank 15.48% following a cut to its fourth-quarter revenue forecast.
• Roblox tumbled 18.13% as daily active users fell 9% from a year earlier, while engagement hours dropped 15%.

Stocks of the day

A tech wreck

Illustration: Morning Brew Inc., Photo: Adobe Stock

The AI boom has finally encountered its most formidable opponent: basic accounting.

After Alphabet shed roughly $500 billion in market value yesterday, Amazon and Intel became the latest tech giants to disappoint Wall Street, as investors grew increasingly impatient with Big Tech’s spending habits and uncertain growth prospects.

That’s led to a selloff spiral among tech stocks: All three indexes traded lower, particularly the Nasdaq, which dropped more than 3.5% throughout intraday trading.

The damage report

Intel: The chipmaker’s quarterly revenue jumped 21% to $16.5 billion, but its fourth-quarter outlook fell well short of estimates. Weak PC demand, rising memory prices, and an explosion at its Israeli chip plant are complicating the turnaround. Intel warned that it expects to burn cash this year despite demand for its AI server chips. Shares plunged 28.58% today.

Amazon: The e-commerce giant reported $201.9 billion in quarterly revenue, up 12% but slightly below expectations. Cloud business grew a whopping 39%, its fastest pace in nearly five years. But investors were skeptical of the bill: Amazon’s free cash flow plunged to negative $42.4 billion year-over-year thanks to pouring money into AI infrastructure. The company expects to spend $220 billion on capital expenditures this year, with more planned for 2027. Shares fell 1.41% today.

Should you buy the dip?

Morgan Stanley’s Mike Wilson believes the broader market correction may be nearing its end, while JPMorgan Chase’s Nikolaos Panigirtzoglou sees signs that selling pressure on AI stocks could be easing.

Strategist Ted Mortonson at Baird is less convinced, urging investors to wait until tech stocks stabilize before jumping in. “From the retail perspective, you’re taking a knife to a gunfight,” he told finance podcast Excess Returns. “We’re generally about six months ahead of you.”—SY

Digital currency

Illustration: Shannon May, Photo: Adobe Stock

Halloween horrors came early for crypto investors. At around 4pm ET Thursday, money started disappearing from Binance. In roughly 20 minutes, hackers siphoned about $6.3 billion from the world’s largest crypto exchange, making for what appears to be the biggest crypto heist of all time.

The blockchain itself wasn’t broken. Attackers instead compromised infrastructure Binance uses to approve withdrawals, letting unauthorized transfers look legitimate. Binance froze withdrawals and said in a post on X that customers would be made whole.

But the market got spooked anyway. Bitcoin fell to a six-week low, ether hit its lowest level in two months, and Coinbase, Strategy, and Robinhood also slid.

Even digital money can still produce a very analog panic. And for an industry built around not having to trust a middleman, that’s not the way you’d expect to lose billions.

Trustless, with terms and conditions

Blockchains were designed to let people own and move assets without relying on a bank or broker. In practice, most investors would rather not spend Saturday guarding a seed phrase like it’s the nuclear codes, so they use exchanges instead.

But that convenience brings the middleman back. Your crypto may live on a decentralized network, but somebody still has to keep the keys safe, approve withdrawals, and make sure the platform itself doesn’t become the weak link.

Recent hacks show why that matters. Attackers stole $1.5 billion from Bybit last year in a heist the FBI linked to North Korea, while Polymarket briefly halted trading this week after a third-party security provider was compromised.

The attackers are also getting more sophisticated. OpenAI recently disclosed that research agents testing cybersecurity capabilities found exposed credentials and access tokens, using them to gain deeper system access. When billions can move in seconds, one bad credential can become a very expensive shortcut.

The vault is part of the valuation

That matters as more institutional money moves into crypto.

EY data from this year finds that 73% of institutional investors planned to increase their digital-asset allocations, while most investors with direct crypto exposure preferred regulated vehicles over holding the coins themselves.

Professional investors increasingly want regulated custodians, insurance, and a clear answer about who pays if something disappears. That’s now helping drive demand for crypto-specific insurance that can cover anything from stolen keys to wallet breaches and custody failures.

The bigger takeaway: Security is starting to look less like a cost center and more like a competitive moat. Exchanges that can prove they have stronger custody, deeper reserves, and better loss protection may have an easier time winning institutional money. A major breach can do the opposite by draining capital, raising insurance and compliance costs, and making customers think twice about where they park their assets.

For crypto this Halloween, the scary part isn’t the trick. It’s figuring out who you trust with the treat.—HC

      

News

• Meta settled its latest teen social media addiction lawsuit for an unknown number, though its previous settlements may offer a clue to how much.
• Big Tech generated record cash this year, but returned just a tiny slice of it back to investors.
• Gen Z is helping drive a TikTok-fueled boom for this drive-through chain, proving the latest caffeine flex may be ordered behind the wheel.
• The NYC Marathon brings in a shocking amount of money for the city, making 26.2 miles an excellent business model.
• Intel may be the lowest performer in the S&P 500 this month—but the highest is a surprise hit.

Calendar

Monday: Apple and Palantir lead tech earnings, while Marriott and Estée Lauder give us a glimpse at consumer demand. Vertex Pharmaceuticals, Williams Companies, Diamondback Energy, and Realty Income also release quarterly numbers. Then we’ll get clues about industrial demand and inflation with the ISM Manufacturing PMI.

Tuesday: The JOLTS report drops, giving us a major read on the labor market. Earnings from AMD, Arista Networks, and Eaton provide a look at AI infrastructure, while Shopify, Booking Holdings, Amgen, Pfizer, Marathon Petroleum, Apollo, and Ferrari also report.

Wednesday: The ADP employment report will offer early clues about private-sector hiring. Arm and Qualcomm lead chip earnings. McDonald’s, Uber, Kraft Heinz, SharkNinja, MercadoLibre, Novo Nordisk, CVS Health, Expedia, McKesson, and Datadog also report.

Thursday: Toyota, Sony, Airbnb, and Cloudflare headline earnings. ConocoPhillips, Canadian Natural Resources, Duke Energy, Southern Company, and Cigna also release quarterly numbers.

Friday: All eyes will be on the official jobs report, which will reveal hiring strength and wage pressures for the economy. We’ll also get the preliminary University of Michigan consumer survey. As for earnings, we’ll hear from Moderna and Humana on healthcare and Enbridge, Vistra, and Oklo on energy.

recs

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