Anthropic investors trim IPO valuation after tech rout

Plus: Wall Street stems losses; Labor sees data centre opportunity; activists storm Microsoft construction site.

Good morning. Here's what happened overnight and what you need to know today.

Hair cut: Anthropic investors are discussing an IPO valuation for the AI lab as low as USD1 trillion after Thursday's punishing market sell-off, Bloomberg reported, citing unnamed sources. Investors had previously told bankers their estimate of fair value was closer to USD1.5 trillion. That changed after the Nasdaq plunged 6.4% following the US midterm elections, led largely by AI-related companies. Three major investors told the Wall Street Journal the valuation may need to be cut by USD500 billion. The AI lab had planned to go public in the next few weeks, raising up to USD100 billion. Anthropic could choose to delay its plans, but Morningstar strategist Michael Field said that might hurt its long-term prospects more than accepting a lower valuation.

Meanwhile, HSBC analyst Max Kettner, who predicted Thursday's sell-off, told Bloomberg the outcome of the Anthropic IPO would be a bigger deal for market sentiment than the midterm elections. "The best case would probably be you come, but you come with a $1 trillion valuation instead of $1.5 trillion valuation," he said. (Bloomberg)(WSJ)

Course correction: Wall Street stocks stabilised overnight after the Democrats' victory in the US midterm elections triggered a sharp selloff of AI-related companies on Thursday. The Nasdaq gained 1.1% on Friday as chip stocks rebounded from Thursday's steep losses. Nvidia, CoreWeave, Intel and Sandisk were among those clawing back ground. However, the tech-heavy index still ended the week down 3.4% and remained in correction territory, more than 10% below its October peak. Strong jobs data also helped steady sentiment. The Bureau of Labor Statistics reported that US employers added 165,000 jobs in October, topping all forecasts compiled by Bloomberg, while the unemployment rate edged down to 4.1%.

US Treasury yields climbed after the release, interrupting a bond-market rally that had followed the elections earlier in the week. But not every stock joined the recovery. Australian software firm Atlassian closed 14.8% lower after reporting first-quarter results. SpaceX bounced 8.6% and Tesla was up 4.2%, despite announcing it would wind down production of the Cybertruck to focus on the Cybercab. (FT)(Bloomberg)(Reuters)(WSJ)