Good afternoon. QQQs +62bps and Semis +2.5% bounced into tonight’s midterms, though semis faded from +4.2% at the highs. Semis up another 2% after the close on better AMD & ANET prints (we sent out first takes here)
All eyes on midterms tonight, and focus has shifted to the Texas governor race vs. the assumed Senate/House victory for Dems. The Texas data-center names bid all day (CIFR +18.4%; HUT +16%; WULF +14.5%; GLXY +15.4%) as well as Neoclouds (IREN +11%; NBIS +7%; CRWV +7%), & power (BE +9%; GEV +6.5%; VST +3.7%).
AI bulls want Abbott to pull out a victory: his challenger Hinojosa has vowed to issue her own moratorium on new data centers, lasting until the Legislature passes new rules. Abbott has paused new hookups too, but only until an ERCOT audit due in December. Remember, about a third of planned US data centers are in Texas, where new permitting is already paused pending a grid audit (behind-the-meter air permits too). RI lays out the risk succinctly in TMTB Slack:
Most desks I’ve seen put the risk to semis at HSD drawdown if Abbott loses, but we’ll have to wait and see.
In terms of timing, here’s how Texas results will likely come in (all times ET):