Wall Street Breakfast Podcast: Japanese Yields Causing Tremors (undefined:USD:JPY)

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Carry-trade worries grow as Japen yields hit levels not seen since 2008. (0:15) Databricks is looking at a valuation of $134B. (1:36) Trump says he now knows who he’ll pick as next Fed chair. (2:11)

The following in an abridged transcript:

A sharp jump in Japanese government bond yields to the highest levels since 2008 is rippling through global markets, stoking carry-trade concerns and weighing on risk assets.

JGBs sold off after Bank of Japan Governor Kazuo Ueda telegraphed a rate increase this month. The 2-year yield, the most sensitive to policy expectations, rose above 1%, its highest level since 2008. The 5-year yield climbed close to 1.4%, while the benchmark 10-year jumped above 1.85% — the highest level since 2008 as well. And The yen (USD:JPY) (JPY:USD) strengthened vs. the dollar.

Ueda said: “If the outlook for economic activity and prices outlined so far is realized, the bank … will continue to raise the policy interest rate and adjust the degree of monetary accommodation.”

U.S. stock index futures (SPX) (US100:IND) (INDU) fell and bitcoin (BTC-USD) sank below $87,000 as investors assessed the risk that rising JGB yields could unwind long-standing yen-funded carry trades.

Japanese institutions have been major buyers of overseas bonds, including U.S. Treasuries (TBT) (TLT), and higher domestic yields raise the risk of capital being repatriated.

Societe Generale strategist Albert Edwards — who refers to himself as an Uber Bear — recently described the surge in JGB yields as the most significant threat to global markets since the post-crisis era of bond-yield suppression began, warning it could undermine the equity bull market.

Data analytics company Databricks is in discussions to raise about $5B at a $134B valuation, which is nearly 32x this year’s expected sales of about $4.1B. That’s according to The Information.

Databricks, whose competitors include data cloud platforms such as Snowflake (SNOW), has raised its sales forecast at least twice this year. It now anticipates sales to rise by 55% this year.

Databricks also told investors its gross margin is declining faster than expected, to 74% compared to an earlier plan for 77%, due to growing usage of its AI products.

And President Donald Trump said Sunday he knows who he is going to pick as the next chair of the Federal Reserve and will announce his decision soon.

But while speaking to reporters Trump declined to confirm that Jerome Powell’s successor would be prediction-markets favorite Kevin Hassett, the current director of the National Economic Council.

Hassett now has a 77% of getting the nomination, according to bets placed on Kalshi. His odds have risen sharply since Tuesday when they were just below 40%. Former Fed Governor Kevin Warsh and Fed Governor Christopher Waller round out the top three.

Speaking on the Sunday shows earlier, Hassett said he would be happy to serve as Fed chief if Trump picks him.

Now Here’s What’s Trending on Seeking Alpha:

Amazon, Google are teaming up to unveil a multicloud service for interconnectivity.

Accenture is now calling employees ‘reinventors’ in a move to embrace AI.

NIO reports a 76% rise in November vehicle deliveries.

Catalyst Watch:

Amazon (AMZN) will hold its big annual cloud conference in Las Vegas starting today. AWS re:Invent will have a heavy focus on agentic AI, infrastructure, and hands-on technical content.

On the economic calendar