Asia Sold the Chips. Dow Futures Bought the Rest.

Korea's Kospi closed down 5.46% at 6,035.35 on Tuesday. Samsung Electronics fell 7.39% and SK hynix 10.09%.

The index is now down about a third from its June record close of 9,114.55. Japan's Nikkei lost 1.82% and Taiwan 1.95%.

Samsung reported record preliminary operating profit last week, 107.4 trillion won, up 783% from a year earlier. Its shares have fallen in every session since.

In New York, Nasdaq-100 futures fell about half a percent early Tuesday while Dow futures rose about as much.

Brent traded near $105, down about 1.5% from Monday's $106.65 settle, its highest since Sept. 15. The 10-year Treasury yield was near 5.19% at 4:30 a.m. as cash trading reopened, below Friday's 5.24% close.

Market Implication

The selling is concentrated in AI hardware and the markets built on it, while Dow futures catch the bid. That works only while the rest of the tape stays calm. The banks report this morning.

JPMorgan Missed on the Bond Desk

JPMorgan (JPM) earned $5.57 a share in the third quarter, below the $5.90 analysts expected, according to LSEG. Revenue was $50.91 billion against $51.22 billion expected.

The quarter included $658 million of net securities losses. Without them, earnings would have been $5.75 a share, still short.

Fixed income, currencies and commodities trading brought in $5.37 billion, against forecasts near $6 billion. The shares fell as much as 4% after the release, then turned higher before the open.

JPMorgan had beaten earnings estimates in 16 of the past 20 quarters, per StreetAccount.

Wells Fargo (WFC) earned $1.87 a share, ahead of the $1.85 expected. Revenue of $21.87 billion missed the $22.3 billion forecast. Its shares were down about 1% before the open.

Structural Setup

Bank stocks came into the week around 12% below their August peak. The first two reports both missed on revenue. Goldman Sachs (GS) and Citigroup (C) report this morning as well, and they decide whether this is one desk or the season's tone.

Sold Out Into 2029. Sold Off Anyway.

Lumentum said Friday its optical parts are sold out into early 2029, a year past the horizon it gave six months ago. On Monday the stock fell 9.8%. Ciena lost 10%. Micron (MU) fell 3.9% and SanDisk (SNDK) 6%.

The leverage came out overnight on crypto exchanges, which now list perpetual futures on chip stocks. About $803 million of positions were liquidated over 24 hours, 86% of them bullish bets, CoinGlass data show. SanDisk contracts lost about $19 million, more than XRP.

Bitcoin's low, just under $81,000, came in the 8 p.m. Eastern hour Monday, as Seoul opened. It was back above $83,000 by early Tuesday while the Kospi kept falling.

Bumble rose 49.6% Monday after The Wall Street Journal reported advanced talks to take it private through Ithaca Holdings for about $1 billion. No deal has been announced, and reports haven't said whether that figure includes debt.

Sector Read

The tape is selling the AI hardware names with the best order books. Demand is already in those prices. What is being repriced is how long it lasts and who pays.

The Threat Now Names the Oil Sites

Houthi official Mohammed al-Bukhaiti warned workers at Saudi oil facilities and airports to stay away, saying the sites "have become legitimate targets." The coalition intercepted another missile aimed at Riyadh on Monday night.

That threat lands on Saudi Arabia's workaround. The East-West pipeline to the Red Sea was moving about 5.8 million barrels a day on Oct. 6. Tanker tracker Kpler counts about 17.1 million crossing Hormuz daily before the war, excluding Iranian cargoes. Only about 4.5 million of the pipeline's flow is available for export.

Brent fell overnight anyway.

Polymarket's contract on the U.S.-Yemen ceasefire holding through Oct. 31 rose to 81.5 cents from 79.5. It fails only on a direct U.S. strike, so Saudi raids don't count. The Oct. 15 line, which resolves Thursday, traded near 97.5 cents.

Watch Signal

Crude is treating the threat as words, and event traders are pricing U.S. restraint. Confirmed damage to the East-West line would test both at once. The International Energy Agency's governing board meets Thursday.

The IMF's Upgrade Leans on the Trade Asia Sold

The IMF raised its 2026 global growth forecast to 3.1% overnight, from 3.0% in July. It credited AI investment with offsetting the oil shock.

Thirty-two economies now account for 95% of global growth, down from 54 in April.

The forecast assumes Hormuz reopens in March 2027 and oil averages about $96 a barrel this year.

The Read

The official forecast and the chip selloff are looking at the same spending. The IMF counts it as support. The market is asking how it gets financed. Broadcom's Hock Tan said Monday that capital "might be the biggest constraint" on AI. If he's right, the upgrade rests on less than it appears.

Economic Data: Existing home sales, 10 a.m. today. September CPI, Wednesday at 8:30 a.m., with headline inflation expected near 3.6% to 3.7% from a year earlier. Beige Book, Wednesday at 2 p.m. Producer prices and retail sales, Thursday.

Fed Speakers: Vice Chair for Supervision Michelle Bowman, Wednesday in Bangkok. Chair Kevin Warsh with the IMF's Kristalina Georgieva, late Thursday. Cleveland's Beth Hammack, Thursday afternoon. Kalshi's October hike contract traded near 17 cents early Tuesday.

Earnings: JPMorgan's call, 8:30 a.m. Goldman Sachs (GS) and Citigroup (C) before the open. Bank of America (BAC), Morgan Stanley (MS) and ASML, Wednesday. TSMC, Thursday.

Overnight: Hong Kong's Hang Seng rose 0.3%. Europe's Stoxx 600 was up about 0.3%.

This morning's numbers say demand is fine.

Samsung posted a record. Lumentum is sold out into 2029. The IMF raised its forecast on AI spending. Chip stocks fell through all three.

What it is pricing is money: who lends against the buildout, and at what rate. JPMorgan's 8:30 a.m. call is the first read on bank appetite. Wednesday's CPI tests what that money costs.