Vertiv's Orders Doubled | The Fed Waited | Cash Bids for Wendy's and LCI

AI Hardware Rose After the Fed. Rate-Sensitive Stocks Did Not.

The S&P 500 rose about 0.3% on Wednesday, and the Nasdaq Composite also gained about 0.3%. The Dow added about 0.2%. An equal-weighted version of the S&P 500 finished about flat, so the gains were concentrated in the largest stocks.

The 10-year Treasury yield rose about 5 basis points on the day to near 5.04%, about 2 of them after the Fed's decision. A homebuilder fund fell about 1.7%. U.S. crude rose about 1.7% to near $101.60 a barrel, and bitcoin traded near $81,100.

Microsoft (MSFT) and Alphabet (GOOGL) were due to report after the close.

Investor Signal

Third-quarter GDP and September PCE inflation arrive Thursday morning. Fed Chair Kevin Warsh said consumer spending was likely growing above 3% last quarter. A strong print would support the case for a December hike and could push long yields higher. A softer one would back the committee's choice to wait.

Vertiv's Organic Orders Doubled. GE Vernova's Backlog Hit $197 Billion.

Vertiv (VRT), which makes power and cooling gear for data centers, said its organic orders more than doubled. Third-quarter sales rose 61% to $4.31 billion, about 14% above forecasts, and it raised every full-year target. The shares closed up about 16.5%.

GE Vernova (GEV) took $29.3 billion of orders, up 96% organically, and its backlog rose to $197 billion. It doubled its buyback to $20 billion and agreed to buy grid-equipment maker Trench Group for about $9 billion. The stock slipped about 1.9%.

Vertiv did not give the dollar value of its orders or the size of its backlog. Its free cash flow rose 50%, slower than sales.

Investor Signal

Demand for the equipment behind AI is still speeding up. The cost of financing it rose on Wednesday, as long-term Treasury yields climbed after the Fed held. Those yields help set borrowing costs for data-center builders. Microsoft's and Alphabet's spending plans will show how much the largest buyers fund with their own cash.

The Fed Held in a 10-2 Vote. Five-Year Yields Fell, 30-Year Yields Rose.

The Fed held its target range at 3.75% to 4.00%. Governor Lisa Cook and Cleveland Fed President Beth Hammack dissented in favor of a quarter-point hike, Cook for the first time. The statement upgraded growth to a "strong" pace.

Warsh called inflation "too high" and said financial conditions are tighter but not "tight." He made no commitment on December. In 2027, one of the Fed's eight yearly meetings will cover strategy only, with no rate vote.

The five-year yield fell about 4 basis points after the statement, while the 30-year rose to about 5.36% from about 5.32%. Canada went the other way, as its central bank raised its policy rate to 2.5%, its first increase since July 2023.

Investor Signal

Bond moves suggested a read of patience now and inflation risk later. That steepens the curve and keeps long-term borrowing costs high without a hike. Oil was up on the day and new Iran headlines crossed during the press conference, so the long-end move cannot be pinned on the Fed alone. Kalshi's contract on a hike at this meeting last traded at 3 cents, though two of 12 voters wanted one. An average of Kalshi and Polymarket prices put December hike odds near 83%.

Enphase Blamed Higher Rates. Lennox Sold More and Earned Less.

Enphase Energy (ENPH) guided fourth-quarter revenue to $225 million to $255 million, well below estimates near $300 million. The company named higher interest rates and the expired federal tax credit for home solar as headwinds. The shares fell about 16% after touching their lowest price since March 2020.

Lennox (LII), which makes heating and cooling equipment, cut its 2026 adjusted earnings outlook to $21.00 to $21.50 a share from $23.00 to $24.00. Revenue rose 10%, but its reported operating margin narrowed 3.2 percentage points. The stock fell about 10.6% to a 52-week low.

Investor Signal

AI builders ordered more equipment on Wednesday, while home solar buyers kept pulling back. Enphase ties its slump directly to financing costs, and its U.S. sell-through fell 35% from a year earlier. The 30-year mortgage rate in the Mortgage Bankers Association's weekly survey stood at 7.37%. Lennox shows a different strain, with sales up and margins down. Higher long-term yields after the Fed make the financing pressure on homeowners harder to ease.

Two Cash Bids Came In Below Earlier Marks

A group led by Trian and franchisee Flynn Group, with BlueFive Capital and Sixth Street, proposed $7.35 a share in cash for Wendy's (WEN). That is about 20% above Tuesday's close but about 2.6% below the price before bid reports surfaced in August. The group said the deal would need no new debt. Wendy's closed up about 15%.

Monomoy Capital Partners offered $101 a share in cash for LCI Industries (LCII). LCI agreed in June to an all-stock merger with Patrick Industries (PATK) that was worth about $116 a share at signing and about $88 now. LCI's board still backs Patrick, and both companies vote on Nov. 18. LCI rose about 8.6%, and Patrick fell about 2.8%.

Investor Signal

Both proposals are non-binding. Each asks holders of a falling stock to take cash at a price below values seen earlier this year. Wendy's bidders plan to fund with equity and keep its existing securitization, which avoids new borrowing at today's rates. Wendy's special committee and LCI's board are the next to decide.

Strategy Will Pay Its Preferred Holders Daily. The Cost Is Still 12%.

Strategy (MSTR) shareholders approved daily dividends on its four preferred stocks, based on preliminary results. STRC, its main tool for funding bitcoin purchases, switches first, with its first daily record date on Nov. 1 if the amendments take effect as planned.

STRC closed near $99.92, just below its $100 par value. Strategy can sell new shares more easily at or above par. Management plans to recommend keeping STRC's rate at 12% until it trades steadily near $100.

Bitcoin traded near $81,100, about 8% above Strategy's average cost of about $75,446 a coin. Strategy shares closed up about 2.7%.

Investor Signal

STRC pays 12% a year, more than twice the 10-year Treasury yield. Daily payments change the timing of that cost, not its size. Strategy and Coinbase (COIN) report Thursday. Strategy's results will show whether preferred sales are funding bitcoin purchases again.

Orders for the equipment behind AI kept climbing on Wednesday, while home solar buyers kept pulling back. The Fed chose to wait, and long-term yields rose anyway.

That leaves borrowers paying more for long-term money even without a hike. Thursday's growth and inflation data, along with the spending plans of the biggest cloud companies, will show whether the AI build can keep outrunning the cost of money.