Wall Street Breakfast - October 11, 2026

Good morning, folks. Grab a seat, pour your coffee, and let's get straight to it. The week was one of those that made the market break a cold sweat: French debt turning into a soap opera, U.S. interest rates at their highest level in 24 years, and Brazil riding a political rally that made people billions in a matter of days. Oh, and a billion-dollar brawl in the AI world. Let's get to the points that really matter.

1. France is on the brink of a fiscal cliff

The fact: French debt hit 119% of GDP (over 3.6 trillion euros) and the deficit will blow past 5% this year, forcing Macron to announce cuts and light up a yellow warning across Europe.

My verdict: I would Reduce exposure to French assets and keep an eye on contagion spilling over to its neighbors.

Assets on the radar:

• The EWQ ETF (iShares MSCI France) - the country's direct thermometer.
• European banks like BNP.PA and GLE.PA, which carry a lot of sovereign debt on their balance sheets.
• The euro EUR/USD, which feels any fiscal sneeze from the eurozone.
• The German Bund (10-year bond), which becomes the region's safe haven while France sinks.

2. U.S. interest rates at their highest level in 24 years

The fact: U.S. Treasury yields have exploded to their highest point in nearly a quarter century, and everyone is now holding their breath waiting for next Wednesday's inflation data.

My verdict: I would Stay cautious and keep defensive positions until the CPI comes out. Now's not the time to bet big before the number drops.

Assets on the radar:

• The US10Y itself (10-year Treasury yield), which sets the global pace.
• The dollar DXY, which strengthens with high rates.
• Gold XAU/USD, the classic hedge against macro uncertainty.
• Small caps via IWM, which suffer the most from high debt costs.

3. Bolsonaro rally makes André Esteves $2.7 billion

The fact: The surprise first-place showing by Flávio Bolsonaro in the polls set off euphoria on the Brazilian stock exchange, and BTG Pactual, André Esteves' bank, rode the wave hard.

My verdict: I would Buy BPAC11 while the political momentum stays favorable, but with a tight stop, because politics is a roller coaster.

Assets on the radar:

• BPAC11 (BTG Pactual), the direct protagonist of the story.
• BOVA11, the Ibovespa ETF, to capture the rally broadly.
• Banks like ITUB4 and BBDC4, which tend to move together in this kind of euphoria.
• The real USD/BRL, which tends to appreciate as foreign flows come in.

4. Netflix plunges 42% and lays off staff after failed Warner Bros merger

The fact: The attempt to buy Warner Bros. sank, Netflix shares melted down 42%, and the company will cut 5% of its workforce.

My verdict: I would Sell NFLX in the short term. Value destruction of this magnitude doesn't get fixed in one board meeting.

Assets on the radar:

• NFLX, obviously, the epicenter of the earthquake.
• DIS (Disney), which could benefit as a streaming alternative.
• WBD (Warner Bros. Discovery), which is left without a buyer.
• AMZN via Prime Video, another competitor gaining ground.

5. Chip startup Nuvacore is worth $2.5 billion without a product

The fact: Nuvacore, just six months old and with no product on the market, is raising hundreds of millions at a $2.5 billion valuation to develop a CPU for data centers.

My verdict: I would Keep my distance from direct bets (it's private, after all), but I'd stay alert to the incumbents. This kind of valuation smells like a bubble in specific sectors.

Assets on the radar:

• NVDA, which dominates the sector and feels any competitive threat.
• AMD, a direct competitor in data center CPUs.
• INTC, which is trying to rise again precisely in this segment.
• SMH, the semiconductor ETF, for exposure to the theme as a whole.

6. TypeSafe AI's Jev hits $7.5 billion in weeks

The fact: TypeSafe AI raised $870 million for Jev, an AI model that doesn't generate text and is already used by a third of the Fortune 500.

My verdict: I would Buy indirect exposure via cloud giants that host this kind of AI. The fever isn't cooling down anytime soon.

Assets on the radar:

• MSFT (Microsoft), owner of Azure and OpenAI's partner.
• GOOGL, with TPUs and Gemini in the fight.
• AMZN, via AWS, infrastructure for enterprise AI.
• PLTR, which lives off selling AI solutions to companies.

Immediate opportunities

• Brazilian banks (BPAC11, ITUB4