Morning Money | Thursday, October 8, 2026

THE BIG STORY: THE INFLATION SQUEEZE JUST INTENSIFIED
Brent crude jumped almost 5% to more than US$105 a barrel as attacks on Gulf shipping renewed fears about Middle East supply. At the same time, the U.S. 10-year Treasury yield held near 5.34%, close to its highest level since 2002.

Why it matters to Canadians: expensive oil can boost energy-company profits and government royalties, but it also raises gasoline, shipping and food costs. High global bond yields feed into Canadian mortgage renewals and business loans—and strengthen the case for the Bank of Canada to keep rates elevated.
Reuters: U.S. premarket | Reuters: Canadian markets

BEFORE THE BELL
• TSX futures fell 0.52% and briefly touched a three-month low.
• The TSX dropped 1.7% Wednesday—its steepest one-day decline since June 5.
• Dow futures were down 0.9%, S&P 500 futures 0.5% and Nasdaq 100 futures 0.7%.
• Amazon, Tesla and Nvidia fell about 1% premarket; AMD, Intel and Marvell dropped roughly 2%.
• Gold stabilized after touching a two-month low Wednesday.

THE FED IS DIVIDED—BUT STILL LEANING TIGHTER
Minutes from September’s meeting showed officials unanimously approved the latest rate hike, but disagreed over why it was needed. Some saw it as insurance against temporary energy and supply shocks; others saw broader demand-driven inflation.

Most policymakers still expect another rate increase before year-end, although Governor Christopher Waller said the Fed has flexibility over timing. Markets expect a pause in October, with December the likelier window.
Reuters: Fed minutes | Federal Reserve minutes

AI’S NEXT PRESSURE POINT: DEBT
Broadcom is reportedly arranging as much as US$50 billion of financing connected to OpenAI, while Oracle is also seeking large-scale funding. The AI buildout is moving beyond chip demand into a competition for capital—one reason investors are watching whether heavy corporate borrowing pushes yields even higher.

EARNINGS: CONSUMERS ARE FEELING THE PRESSURE
PepsiCo cut its annual core-profit growth forecast to 1%–2%, down from 4%–6%, as higher costs squeezed margins and cautious North American consumers reduced spending on snacks and beverages.

Applied Digital offered the opposite picture: quarterly revenue more than quadrupled to US$341.9 million, reflecting continued demand for AI data-centre infrastructure.
Reuters: PepsiCo

WHAT TO WATCH
• Today’s U.S. 30-year Treasury auction—a key test of bond-market demand.
• Whether Brent remains above US$105.
• Canada’s September jobs report Friday; it could materially shift Bank of Canada expectations.
• Big-bank earnings begin next week, testing whether profits justify elevated stock-market valuations.