【US Pre-Market】Three Major Stock Index Futures Rise as Brazilian Assets Are Sold Off, XP Plunges Over 40%, NU Drops Over 20%

TradingKey - On October 26, US Eastern Time, futures on the three major US stock indexes rose slightly. As of press time, Dow futures rose 0.29%, S&P 500 futures rose 0.16%, and Nasdaq 100 futures rose 0.23%.

[Source: Investing]

Diverging from broad market futures, Brazil-related stocks faced a concentrated sell-off, with Nu Holdings (NU), XP Inc. (XP), and Petrobras (PBR) falling sharply in pre-market trading.

In commodities, international oil prices pulled back from recent highs but remained elevated. As of press time, Brent crude (UKOIL) was at $109.96 per barrel, while WTI crude (USOIL) was at $100.98 per barrel.

Gold (XAUUSD) remained above $4,000 per ounce, currently trading at around $4,018 per ounce; Bitcoin fluctuated above $80,000. Markets continue to focus on the Middle East situation, energy supply risks, and this week's Federal Reserve interest rate decision.

Market Movements

Nu Holdings plummeted over 20% in pre-market trading as Brazilian financial stocks faced a sell-off.

As of press time, Nu Holdings fell about 23% in pre-market trading to around $11.70. Following the outcome of the Brazilian presidential election, market concerns escalated over the new government's fiscal policy and economic trajectory, prompting a concentrated sell-off in Brazil-related assets. With Nu Holdings mainly serving Brazil and other Latin American markets, its share price was impacted as well.

XP Inc. dropped over 40% at one point in pre-market trading.

XP's pre-market losses reached as much as around 45%, while the iShares MSCI Brazil ETF (EWZ) and Brazilian financial stocks such as Itaú Unibanco (ITUB) and Banco Bradesco (BBD) also registered notable declines. Market concerns mounted over the new government's fiscal spending and economic policies potentially affecting inflation, interest rates, and the Brazilian real exchange rate, thereby shifting financial institutions' funding costs, credit demand, and profitability prospects.

Brazilian oil company Petrobras fell over 20% in pre-market trading.

Petrobras dropped about 22% at one point in pre-market trading. Beyond the overall market sell-off, investors were focused on the new government's policy stance toward state-owned energy enterprises, including fuel pricing, corporate operations, and shareholder returns. Brazilian financial and energy stocks came under pressure together, reflecting market re-evaluations of the election results' impact on local asset valuations.

Rent the Runway (RENT) surged over 30% in pre-market trading.

As of press time, Rent the Runway was up about 33% to 35% in pre-market trading, with its stock price at roughly $3.05 to $3.11. The company specializes in apparel rental services, enabling consumers to rent clothing and accessories via subscription.

The company's previously released second-quarter fiscal 2026 results showed revenue grew 20.8% year-over-year to $97.7 million, with adjusted EBITDA reaching $12.6 million, up from $3.6 million in the prior-year period.

CoreWeave (CRWV) and Nebius (NBIS) fell in pre-market trading.

Both companies dropped over 3% at one point in pre-market trading. Earlier, Elon Musk warned that some emerging cloud service providers focused on AI compute rental might face operational difficulties or industry consolidation due to constrained financing channels. His remarks heightened market attention on AI infrastructure investment returns and financing risks.

Both CoreWeave and Nebius benefit from growing demand for AI computing power, but data center construction, GPU procurement, and long-term contract fulfillment require substantial capital. Beyond revenue and order growth, their future stock performance will also be influenced by funding costs, cash flows, and returns on capital expenditures.

Market News

Brazilian Presidential Election Triggers Market Turbulence; Fiscal Policy Takes Center Stage

Brazilian President Luiz Inácio Lula da Silva won the runoff presidential election on October 25, defeating right-wing candidate Flávio Bolsonaro with 51.75% of the valid votes. The election outcome diverged from the prior expectations of some investors, putting immediate pressure on Brazilian stocks, the real, and bond markets. Previously, some capital had bet on a Bolsonaro victory, anticipating that he would push for market-friendly fiscal consolidation and economic reforms.

Subsequent market trends will hinge on the fiscal arrangements, public spending plans, and economic team appointments of Lula's new administration. If investor concerns over fiscal sustainability deepen, Brazil's long-term interest rates could rise and the real could face continued pressure, thereby weighing on the valuations of local financial institutions and energy companies.

Musk Warns AI Neoclouds Face Financing Pressure as Industry Consolidation Risks Rise

Elon Musk posted on social media platform X on October 25 that debt markets have significantly tightened financing for companies lacking major revenue streams outside of AI data centers, predicting that emerging AI cloud service providers (neoclouds) will face bankruptcies and industry consolidation.

Musk also stated that SpaceX has completed $40 billion in debt financing, primarily to fund GPU procurement.

SK Hynix to Announce Earnings and Shareholder Return Plan on October 28

SK Hynix (SKHY) will announce its third-quarter 2026 financial results on October 28 and plans to disclose additional shareholder return measures following board approval.

South Korean media reported that the company may pay a special dividend of approximately 16 trillion won (about $12 billion), potentially funded by proceeds from selling its stake in Japanese memory chipmaker Kioxia.

SK Hynix stated that it is evaluating various options to enhance shareholder returns but has not yet reached a final decision, with plans to announce relevant measures on October 28.

In addition to shareholder returns, investors will focus on the company's third-quarter revenue, operating profit, and performance across its HBM, DRAM, and NAND businesses, as well as future capital expenditure plans, to assess the actual contribution of growing memory chip demand to earnings and cash flow.

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