Debt markets fired first. Derivatives finished the job. DeepSeek handed them the knife.
Sunday 4am ET, Nasdaq closed but Binance perpetuals got wrecked in 10 minutes: $WDC -7.03%, $MU -6.32%, SK Hynix -6.3%, $SNDK -6.1%. Samsung down 17.8% for the week, SK Hynix -24.3% — worst drawdown since 2008.
The trigger wasn't junk bonds, it was AI-specific debt:
• CoreWeave bonds yielding 15-16%, CDS spread blew past 1000bps. Max Frumes at 9fin called it "the canary in the coal mine"
• Oracle 5-year CDS hit 288bp, all-time high
DeepSeek's knife: Flash-1017 pricing unchanged, but per-task cost collapsed from ~$0.50 to $0.20. Databricks' Yuchen Jin benchmarked it at "Opus-5 performance, 83x cheaper." When inference gets commoditized this hard, hundreds of billions in capex projections need repricing.
Yet SK Securities just raised 2025 earnings estimates and HBM supply constraints are intensifying. Watch CoreWeave debt spreads, Oracle CDS, and earnings on 10/28 (SK Hynix) + 10/29 (Samsung).
Sunday 4am ET, Nasdaq closed but Binance perpetuals got wrecked in 10 minutes: $WDC -7.03%, $MU -6.32%, SK Hynix -6.3%, $SNDK -6.1%. Samsung down 17.8% for the week, SK Hynix -24.3% — worst drawdown since 2008.
The trigger wasn't junk bonds, it was AI-specific debt:
• CoreWeave bonds yielding 15-16%, CDS spread blew past 1000bps. Max Frumes at 9fin called it "the canary in the coal mine"
• Oracle 5-year CDS hit 288bp, all-time high
DeepSeek's knife: Flash-1017 pricing unchanged, but per-task cost collapsed from ~$0.50 to $0.20. Databricks' Yuchen Jin benchmarked it at "Opus-5 performance, 83x cheaper." When inference gets commoditized this hard, hundreds of billions in capex projections need repricing.
Yet SK Securities just raised 2025 earnings estimates and HBM supply constraints are intensifying. Watch CoreWeave debt spreads, Oracle CDS, and earnings on 10/28 (SK Hynix) + 10/29 (Samsung).