The 10-year US Treasury yield reached approximately 5.34%, marking the highest level since 2002. The 30-year yield also climbed to about 5.68% before pulling back as of the latest trading update.

This surge in long-term yields has pushed the iShares 20+ Year Treasury Bond ETF (NASDAQ: TLT) below its technical danger zone. Analysts note that rising yields have moved beyond ordinary volatility into a technically weaker regime, increasing competition for equity investments. Similar yield jumps were observed in France and the UK before subsequent pullbacks.

Bond Market Technicals

Technical analysis of TLT indicates the ETF is oversold, with an increase in short positions in long bonds. This setup is viewed as a potential precursor to a short squeeze that could push TLT back above the danger zone from below. The upcoming official jobs report is considered critical for determining the next directional move in both bond and stock markets.

AI Sector Sentiment Shift

Market reaction to recent corporate news suggests a change in the current phase of the AI trade. Micron Technology Inc (NASDAQ: MU) reported earnings that guided better than consensus but fell below whisper numbers, with gross margins slightly missing consensus estimates. Consequently, MU stock remained range bound post-earnings, contrary to options market forecasts of a 7% move.

Similarly, Broadcom Inc (NASDAQ: AVGO) announced a $42 billion lending deal with Anthropic for chip leasing. While such news might have previously triggered a 10-15% premarket rally, AVGO stock rose only 0.5% in early trading. This muted response indicates that investors are no longer reacting to AI-related announcements with the same enthusiasm seen in prior quarters.

Early Money Flows

Early trading data shows positive money flows in most Magnificent Seven stocks, including Amazon.com Inc (AMZN), Alphabet Inc Class C (GOOG), Meta Platforms Inc (META), Microsoft Corp (MSFT), NVIDIA Corp (NVDA), and Tesla Inc (TSLA). Apple Inc (AAPL) was the sole outlier with negative money flows. Broad market indices also saw positive inflows, with SPDR S&P 500 ETF Trust (SPY) and Invesco QQQ Trust Series 1 (QQQ) recording gains.

Initial jobless claims came in at 197K, beating the consensus estimate of 200K. Bitcoin remained range bound during this period.

Micron Technology Inc. (NASDAQ: MU) reported record fiscal fourth-quarter revenue of $54.23 billion, up about 379% year over year, beating analyst estimates of $51.13 billion. Adjusted EPS of $33.42 also beat expectations of $31.45.

Despite the strong beat, shares closed flat at $1,065.11 during regular trading and rose just 0.37% to $1,069 in after-hours trading. Futurum Equities analyst Shay Boloor noted the muted reaction stemmed from Q4 being heavily price-driven, with DRAM revenue up 27% while shipment volumes grew only mid-single digits, and NAND revenue up 42% with approximately 30% pricing. The market, he said, was still treating the earnings as a peak that could fade once supply catches up.

Contract book exceeds annual revenue

On Sept. 30, Micron disclosed it has approximately $150 billion in remaining performance obligations tied to 26 long-term customer agreements. This contract book is about 13% larger than the company's total fiscal 2026 revenue of $133.2 billion.

The figure represents committed future business rather than cash already collected. All 26 agreements include take-or-pay volume commitments, requiring customers to buy agreed amounts or face contractual consequences. These agreements now cover more than 35% of Micron’s estimated revenue through 2030, with some extending into 2031.

Micron calculates this figure using minimum pricing where frameworks are set; actual revenue over the life of the agreements is expected to be higher. For a memory business historically subject to violent boom-and-bust cycles, this level of contracted demand provides significant visibility into future sales, moving a portion of demand from spot-market forecasts to binding commitments.

2027 output largely spoken for

CEO Sanjay Mehrotra disclosed on the earnings call that more than 75% of Micron's 2027 chip output is already committed, and that the majority of customer discussions have already shifted toward 2028. A large portion of its 2027 high-bandwidth memory (HBM) volume is sold out, with prices set materially higher than 2026 levels, which Mehrotra said was helping narrow the margin gap between HBM and the rest of its memory business. He added that demand is expected to continue to outpace supply through 2027 and 2028, with the industry tightening in both years compared with 2026.

Boloor pointed to this visibility, alongside new cleanroom capacity not arriving until late 2028, as the reason the underlying demand strength could hold.

Guidance raised on AI-driven demand

The company guided for first-quarter fiscal 2027 revenue of $60 billion-$63 billion and adjusted EPS of $37.15-$39.15, both above Wall Street estimates of $57.24 billion and $35.36, respectively. Benzinga Edge rankings indicate Micron's stock has a Momentum score in the 99th percentile and a Growth score in the 93rd percentile.

Micron eyes humanoid robots for next growth phase

On the earnings call, Mehrotra stated that physical AI could become a significant driver of memory and storage demand by the end of this decade. Autonomous vehicles are the first major use case, requiring more than 200 gigabytes of memory and multiple terabytes of storage, with demand expected to extend to humanoid robots and other autonomous systems. Several physical AI customers are already sampling Micron's next-generation products. To capitalize on this opportunity, the company is increasing investment in its technology roadmap, with first-half capital expenditure of around $25 billion, following $10.8 billion in fiscal fourth-quarter capex.

Boloor commented that this shift would effectively put "server level memory into millions of machines outside the data center," identifying humanoid robots as the turning point for physical AI demand. Companies like Tesla (NASDAQ: TSLA) with its Optimus robot and XPeng (NYSE: XPEV) with its IRON robot are actively scaling production lines for these general-purpose humanoids.

Other market movers

Alphabet Inc. (NASDAQ: GOOGL) Class A shares rose 0.93% to close at $344.08. The company introduced Gemini 4 Argon, its most advanced AI model to date, targeting complex workloads including software engineering, enterprise knowledge, and cybersecurity. The model is already being used internally for data-center memory efficiency and quantum-computing optimization. Alphabet plans a phased external rollout following additional safety testing, with initial pricing set at $2 per million input tokens and $10 per million output tokens. In extended trading, shares rose 1.54% to $349.39.

The Generation Essentials Group (NYSE: TGE) saw its stock rise 86.75%, closing at $1.55. First-half 2026 earnings rose to 56 cents per share from 12 cents a year earlier, while net profit increased to $22.8 million from $2.1 million. Despite a 24.7% decline in total revenue to $65.86 million, core customer-contract revenue increased 35.8% to $30.8 million, led by media advertising and hospitality growth. Hotel operations revenue rose 59.8% to $20.2 million following the acquisition of four properties, lifting total assets to $1.8 billion.

Robinhood Markets Inc. (NASDAQ: HOOD) stock dipped 3.2% to $112.50 after the company unveiled plans to extend trading hours and introduce AI-powered trading tools, announced at the HOOD Summit in Houston. Progress Software Corporation (NASDAQ: PRGS) shares increased 1.34% to close at $39.97. Fiscal third-quarter revenue was $246 million, down 2% year over year, while non-GAAP EPS rose 13% to $1.69 and ARR increased 1% to $873 million. The company raised its fiscal 2026 revenue guidance to $1.044 billion-$1.052 billion from $990 million-$1.002 billion previously, with non-GAAP EPS guidance increased to $6.15-$6.23 following the acquisition of Domo's AI and data platform business.

Market snapshot

What the numbers show

Micron's Q4 performance was driven by pricing rather than volume, with DRAM and NAND revenue growth outpacing shipment growth by a wide margin. However, the disclosure of $150 billion in remaining performance obligations provides structural visibility into demand sustainability that exceeds the company's entire fiscal 2026 revenue base of $133.2 billion. This contract book, supported by take-or-pay clauses and covering more than 35% of estimated revenue through 2030, contrasts sharply with the historical volatility of the memory sector. Capital expenditure of $10.8 billion in Q4 and a projected $25 billion in the first half of fiscal 2027 signal aggressive capacity investment ahead of the anticipated surge in physical AI and HBM demand.