Wall Street Brunch: Hooray For DevDay (NASDAQ:MSFT)

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Government shutdown now seen lasting three weeks. (0:17) Sam Altman will give the DevDay keynote for the world’s biggest startup. (4:47) Bitcoin top $125,000 for first time. (2:57)

The private sector continues to lead the way for Wall Street with the government shutdown entering its second week.

Prediction market Kalshi now has the shutdown lasting nearly 21 days (a 64% chance of its lasting more than 15 days, 52% for more than 20 days and 40% more than 25 days).

Goldman Sachs economists say for each week of a shutdown, the direct effect of furloughed federal workers would reduce fourth-quarter annualized real GDP growth (quarter-on-quarter) by about 0.15 percentage point. Reopening would result in an equally sized positive effect on growth in the first quarter, assuming the shutdown ends before then.

If anything can take the spotlight from the shutdown, it’s the AI trade. And the week kicks off with a major event. OpenAI hosts its DevDay on Monday with CEO Sam Altman kicking off the event with a keynote at 1 p.m. ET. He will also participate in a fireside chat with Apple designer Jony Ive at 7:15 p.m. ET.

No product releases have been teased, but there is speculation the company could debut a long-rumored AI-powered browser (possibly named Aura) that would challenge Google’s Chrome.

Microsoft-backed (NASDAQ:MSFT) OpenAI hit a private market valuation of $500 billion this past week, making it the world’s most valuable startup.

Also this week, the AI bulls at Wedbush reiterated that they see the tech bull market lasting another 2-3 years and any worries about a tech bubble are “way overdone,” with enterprise spending trends accelerating.

And to be sure we get the LLM perspective, ChatGPT told me: “I’m most looking forward to Sam Altman’s keynote, which should unveil what’s next for GPT-5, multimodal tools like Sora, and the new ‘Responses’ API that deepens agent capabilities. I’m also curious to see how OpenAI makes real-time, voice, and safety tools more practical for developers — the pieces that turn demos into daily use.”

Looking to earnings, five S&P 500 companies will report Q3 results this week. The highlights will be PepsiCo (PEP) and Delta Air Lines (DAL) on Thursday.

Analysts expect Pepsi to report EPS of $2.26 on revenue of $23.86 billion. Activist investor Elliott Management is calling for strategic changes such as refranchising to improve bottling inefficiencies. Jefferies said a move to refranchise could sharpen the focus on high-growth areas of the Pepsi portfolio.

Delta is forecast to post EPS of $1.53 with revenue of $15.94 billion. SA analyst Dhierin Bechai says Delta is executing the business better than many of its peers while trading at a discount,” which creates an interesting buy opportunity.

Also on the earnings calendar:

Constellation Brands (STZ) reports Monday.

On Tuesday, McCormick (MKC) issues numbers.

Levi Strauss (LEVI) and Tilray (TLRY) join Pepsi and Delta on Thursday.

On the economic front, the shutdown likely robs traders for numbers on the trade balance and weekly jobless claims again.

But on Wednesday the FOMC minutes of its last meeting will be closely watched. Odds of two more quarter-point rate cuts this year topped 85%.

On Friday the University of Michigan releases its preliminary measure of October consumer sentiment. Last week the Conference Board’s measure of consumer confidence fell to a five-month low.

In the news this weekend, Bitcoin (BTC-USD) rose through $125,000 for the first time. The crypto has been up six of the last seven days, fueled by strong inflows into bitcoin ETFs and renewed institutional interest.

OPEC+ has agreed in principle to raise oil production by 137,000 barrels per day starting in November. The move echoes the modest increase made in October.

And Costco (COST) members will soon get access to blockbuster weight loss medications Wegovy and Ozempic at half the list price.

Novo Nordisk (NVO) announced plans to offer its popular GLP-1 medications to cash-paying members of Costco as part of a new partnership with the pharmacy operations of the warehouse club.

For income investors, JPMorgan (JPM) goes ex-dividend on Monday, paying out on Halloween.

Dollar General (DG) goes ex-dividend on Tuesday, with an Oct. 21 payout date.

Oracle (ORCL) goes ex-dividend on Thursday, paying out on Oct. 23.

And dividend heavyweight AT&T (T) goes ex-dividend Friday, paying out on Nov. 3.

And in the Wall Street Research Corner, BofA strategist Michael Hartnett is predicting what investing themes will be “in” and what will be “out” in the second half of this decade.

The second half of the 2020s tilts toward security, state intervention, demographics/tech shifts, and new asset plays — while globalization, Fed independence and old market darlings are seen as past their peak.

Humans are “out” and robots are “in.” Fed independence gives way to Fed deference, quantitative easing is “out” and yield curve control is “in,” the AI bull becomes the AI bubble and The Magnificent 7 make way for China’s – Baidu, Alibaba, Tencent and Xiaomi.