Anthropic's IPO filing calms AI nerves, for now

Good morning. Wall Street finally got a bit of relief last night. Anthropic filed for an IPO and disclosed its finances for the first time, easing AI bubble worries, and stocks rose ahead of big-tech earnings. The filing shows revenue growing from about $41 million in 2023 to $16.3 billion in the first half of this year, with more than $130 billion in cash.

That doesn't mean it's all clear. Jim Cramer warned that with $148 billion already raised in IPOs this year, big offerings from Anthropic and Meta could outrun demand. Meta is planning to issue up to $95 billion in stock to fund AI infrastructure. Elon Musk said more than 200 neoclouds, the newer companies that rent out AI computing, could go bust or be absorbed, and related shares dropped sharply.

The Fed meets tomorrow. A hold at 3.75% to 4.00% looks likely, but with inflation above 3% the market puts roughly 78% odds on another hike in December. Many analysts say a surprise hike is unlikely a week before the midterms. After a big October rally in bonds, the 10-year yield stalled just below 5%.

Oil fell more than 2%. Friday's spike from the Houthi attack on Saudi Arabia reversed on hopes for U.S.-Iran diplomacy. It's too early to relax, though, since President Trump hinted that strikes on Iran could resume after the midterms. Elsewhere, Brazilian assets slid after Lula won a fourth term.