Welcome to Staten News, where a satellite company moved the tower stocks and a fertilizer company moved nobody but itself.
📡 Last Week's Winner: Crown Castle (CCI) +17.85%
SpaceX agreed Thursday to pay roughly $8 billion in cash for Grain Management's nationwide 800 MHz spectrum. Telecom investors read that as a threat. Tower investors read it as a new tenant.
Crown Castle went from $67.58 to $79.64 on the week, up 17.85%, the best performance in the entire S&P 500. SBA Communications (+12.77%) and American Tower (+12.31%) were right behind it.
The logic goes like this. Low-band spectrum is the stuff that gets through walls, but a satellite overhead still struggles to put a strong signal inside a Manhattan apartment. To fix that, SpaceX would probably need equipment on the ground, and ground equipment needs towers. Bernstein said the deal keeps that build option "very much alive."
The stock was cheap going in, too. Crown Castle was down 22% on the year before Friday and traded around 14 times forward AFFO, against a five-year average of 18.6.
Here's the catch. AT&T, Verizon and T-Mobile pay the large majority of Crown Castle's site rent, and all three got hammered on the same headline. T-Mobile lost 9.75% for the week. Verizon lost 9.16%. Crown Castle rallied on a customer it doesn't have yet while its actual customers sold off.
That's not a tower trade. That's an option on SpaceX building something, priced like it already happened.
🧪 Last Week's Loser: Mosaic (MOS) -11.98%
The worst stock in the S&P 500 last week sells fertilizer. Mosaic slid from $21.29 to $18.74.
RBC Capital Markets kicked it off on October 5, cutting Mosaic to Sector Perform from Outperform. Analysts have been flagging rising costs tied to phosphate production cuts and lower potash output, which puts third-quarter profit at risk of missing. This is a company that already posted a $273 million net loss in the second quarter.
Nobody needed a second reason.
The story here isn't SpaceX or rates. It's a commodity producer whose own plants are getting more expensive to run while the Street is lowering targets. Until the next earnings report shows the cost problem is fixed, the stock doesn't have anything to lean on.
🏦 The Week Ahead: Banks First, Inflation Second
Bond markets are closed today for Columbus Day. Stocks are open. Enjoy the quiet, because it ends early tomorrow morning.
JPMorgan, Goldman Sachs, Citigroup and Wells Fargo all report before the bell Tuesday. Bank of America and Morgan Stanley follow Wednesday. Then September CPI lands Wednesday at 8:30 a.m. ET, with consensus calling for headline inflation of 3.6% year over year, up from 3.4% in August.
That's the thread running through the whole week. The 10-year Treasury yield touched nearly 5.37% last Wednesday, a 24-year high, before settling back under 5.25% by Friday. Brent crude closed the week around $104. And the S&P 500 still finished up 1.2%, its record high from earlier in the week intact.
The market keeps shrugging at rates. A hot CPI print is the thing most likely to make it stop.
📈 This Week's Predicted Gainer: JPMorgan Chase (JPM)
Banks are one of the few businesses that actually like a 5% 10-year yield.
JPMorgan reports Tuesday with consensus around $5.82 to $5.84 per share on roughly $50.6 billion in revenue. The number that moves the stock isn't EPS, though. It's full-year net interest income guidance. If management nudges NII higher on the back of where rates sit now, the stock has room to run before CPI even shows up.
Trading desks also tend to print money when bonds and oil swing this hard, and last quarter's trading was already strong across the group.
And honestly? The risk is credit. If card charge-offs jump, the whole bank group sells off and JPM goes with it. I'd still rather own the biggest balance sheet in the room going into a high-rate print than bet against it.
📉 This Week's Predicted Loser: Verizon (VZ)
Verizon closed Friday at $41.65 after losing 9.16% on the week. My bet is the bleeding isn't done.
Two problems stack on top of each other. The SpaceX deal hands the market a fresh reason to put a lower multiple on every wireless carrier, even if real competition shows up slowly and starts in rural markets. Slow-burn threats are exactly the kind that keep a stock heavy for weeks, because nobody can rule them out.
Because the second problem is the 10-year. Verizon trades like a bond with a dividend stapled to it. When Treasuries pay over 5% with zero network risk, a telecom yield gets a lot less special, and a hot CPI Wednesday pushes yields the wrong way.
Could it bounce on a relief rally? Sure. Headline selloffs sometimes reverse fast. But nothing on this week's calendar hands Verizon a reason to.
This is the week the market finds out whether 5% yields are a speed bump or a wall.
Sources: Capital Insight S&P 500 Weekly Market Pulse, Yahoo Finance Markets News, Oct. 9, TIKR on Crown Castle, Nowflation September CPI Preview
This is not financial advice. Always do your own research.
— The Bandicoots 📊🏦