Bloomberg Surveillance TV: October 16th, 2026

CoreWeave

Across the shows: 21 speakers in other episodes, 5 bullish and 22 bearish calls, past 30 days

• Dominique Toublan · BarclaysUncertain

  CoreWeave's bond selloff looks sentiment-driven and overdone, but its leveraged, concentrated profile is fragile.

  CoreWeave's bonds fell from par to the 70s in about four months, with CDS widening to quite wide levels, yet there was no strong hard news to justify it, only some headlines and tweets that shifted sentiment. Traders got stopped out and the move was exaggerated, with bonds recovering the next day. Toublan still sees it as an expensive credit at about 15% yield and says that a concentrated, more levered issuer is more sensitive to short-term swings than the big cash-generating hyperscalers, so the selloff is a sign of real fragility, not just noise.

  “There was not really any you know strong hard news around [CoreWeave] that made you change your mind. ... some headlines, some tweets, changed a little bit the sentiment.”at 10:08

Credit markets

• Dominique Toublan · Barclays

  Triple-C spreads above 1,000bp; weak-growth, costly-funded borrowers face pressure, unlike the overall market.

  Toublan points out that triple-C credits are trading wider and are north of 1,000 basis points, so the environment is not fine for everyone. With higher real rates cutting into funding, companies that have less access to funding or pay more to borrow, and that struggle to grow their top line, face the most pressure, since growth is normally what saves them. He also cites the very large high-yield versus investment-grade decompression this year, where high yield is about 55bp wider versus 5bp for investment grade, as a sign of this stress.

  “The triple c companies are trading wider. They're north of thousand basis points.”at 13:04

• Dominique Toublan · Barclays

  Investment grade spreads at 83bp versus a 130bp median are too tight; risk-reward looks poor.

  Toublan says the investment grade index sits at 83 basis points against a historical median of about 130, so spreads are still very tight. Cyclical sectors outside the hyperscalers also trade very tight, which he thinks is a bit too tight from his perspective. The risk-reward is not where it should be, which shows the market is not worried about macro conditions or earnings. He notes that upcoming hyperscaler earnings could change the picture, but for now he sees the market pricing little risk.

  “look at the cyclicals, they are trading very tight as well. A bit too tight in my perspective. The risk reward is not quite where it should be”at 14:02

• Dominique Toublan · Barclays

  Likes front-end double-B high yield: good fundamentals and carry without much duration risk.

  Toublan likes front-end double-B bonds. Investors moved into the higher-quality part of high yield for extra carry after rates moved and sentiment shifted, and he thinks the macro environment and fundamentals are good. Because of that backdrop, investors do not need to take much duration risk, and the front end of the curve looks attractive. He notes this is a view he has repeated over the last few months.

  “I do like front end double b's. I think there's good stuff to to be done there. Look again, the the macro environment is good. The fundamentals are good. So I think you don't need to take a ton of duration risk there.”at 15:24

AI infrastructure & data centers

• Keith Lerner · Truist Advisory Services

  Hyperscalers' growth and rising tech estimates are fine; leveraged marginal AI builders are where problems lie.

  Asked about the risk that heavy capex fails to turn into profit and that higher rates hurt tech, Lerner notes forward tech earnings estimates are up 18% over the last three months, with no change in that picture. He expects big hyperscalers still show strong growth in core businesses including cloud, which should reassure investors. The stress he sees is in marginal players that depend on leverage and debt markets, so he would favor companies with big balance sheets over high-leverage ones.

  “what it tells me, Jonathan, is the marginal players, the ones that are dependent on leverage and the debt markets, is really where there's more problems”at 5:43

• Dominique Toublan · Barclays

  Hyperscalers with huge cash flows fund capex cheaply; levered, concentrated neoclouds are far more exposed.

  Toublan argues AI capex borrowers are very different credits. Some, like Google, Meta and Amazon, are diversified cash-flow machines with high operating margins, so their funding costs are fine. Others are very concentrated and more levered, so they are more sensitive to market sentiment and to funding costs. He says you need to separate a high-yield neocloud from the big hyperscalers, since they play very different roles in the capex build-out, and that contagion tends to hit higher-beta names first before spreading.

  “You have some of them that have absolutely incredible cash flow machines. And for these, the funding cost is okay. Their operating margin is very high as well.”at 11:30

US stock market outlook

• Keith Lerner · Truist Advisory Services

  Tech needs a rest; other laggards bounce for weeks, but money eventually returns to tech while the bull market holds.

  Lerner says tech is still the primary driver of the market over time but after a roughly 20% gain and a wide outperformance, it is due for a rest. Tech sold off while health care, small caps and the equal-weight index bounced as the rest of the market had been oversold, with financials and industrials down 5-10% last month. He expects that rotation to give other areas a bounce over weeks, maybe a month or two, while the bull market stays intact, and that money eventually rotates back into tech. Falling rates also help the beaten-down areas.

  “I think it's a bounce over weeks, maybe a month or two, but I think money eventually will come back to tech in our view.”at 2:38

AI bubble & tech valuations

• Keith Lerner · Truist Advisory Services

  Mag Seven likely keep outperforming; tech's 9% premium to the market is among the lowest in a decade.

  Lerner still likes the Magnificent Seven and expects them to likely still outperform, with runway left. Even though semiconductors sold off, the Mag Seven made a new high in the last week, which he reads as panic setting in. He points to tech trading at about 20.5 times forward earnings with a premium to the overall market of about 9%, one of the lowest premiums for tech over the last decade. That low premium is his argument that valuations are not stretched and bigger tech players remain the place to stay.

  “we're training around the 20.5 multiple right now, and the premium to the overall market is about 9%. That's one of the lowest premiums we've seen for tech over the last decade.”at 7:29

Market sentiment, positioning & volatility

• Rick Wurster · The Charles Schwab Corporation

  Clients are fully invested in equities with rising margin borrowing; no sign of pulling back.

  Wurster says clients own more equities than ever, and a larger share of their wealth is in stocks. Leverage is still high, with clients taking on more and more margin, so trading activity remains high. He sees no signs that people are pulling back from equities even as fixed income interest rises. This points to a retail base that is still heavily long and leveraged, based on Schwab's own account data.

  “At the same time, we still see people fully invested in equities and leverage is still high, they've been taking more and more margin, so their trading activity remains high. There's no signs that people are pulling back from equities”at 18:20

US Treasuries & yields

• Rick Wurster · The Charles Schwab Corporation

  A roughly 3.4% real 30-year yield is an attractive lock-in for retirees, driving record fixed income interest.

  Wurster says clients are showing record levels of interest in fixed income, and he links that to yields. The real yield on a 30-year Treasury was about 3.4% recently, so for someone retiring at 65, locking in 3.4% real for 30 years is a good deal. He thinks that makes a lot of sense for a specific demographic right now, and he notes yields of around 5% are available in many places if investors take a little more risk.

  “The real yield on a thirty year was 3.4 recently, so for someone retiring at age 65, to be able to lock in 3.4% real for thirty years is a pretty good deal.”at 18:47

Consumer AI products

• Rick Wurster · The Charles Schwab Corporation

  Investors love AI but are not yet willing to hand over financial accounts to AI agents.

  Wurster says that even as people use AI more every day, activity on agents touching accounts is very limited. Schwab gets a weekly report on blocked agent attempts, and the big agents are blocked in the tens to twenties per week. He reads this as evidence that while people love AI, they are not yet willing to turn their financial accounts over to it, so consumer demand for autonomous agents in investing is still early.

  “we're seeing very limited activity. I get a report on how many times we've blocked clients from using one of these agents in a week, and it's in the tens and twenties per week that the big agents are being blocked.”at 21:58