Wall Street fears ‘doom loop’ as ‘France is veering toward a full-blown civil crisis’

Key Points:

• Anthropic is launching a "presidential engagement" program for the 2028 U.S. election cycle, creating an in-house team to work with presidential candidates on AI policy and guide the company's political strategy and funding efforts. This move highlights the growing importance of government relations and White House support in the AI industry ahead of Anthropic's potential $2 trillion IPO.
• President Donald Trump announced he will not initiate combat operations against Iran before the November midterm elections, despite the Pentagon deploying additional aircraft carriers to the region amid escalating tensions. The U.S. military response has been restrained, even as Iran and allied groups continue attacks in the strategic Strait of Hormuz.
• Wall Street analysts are increasingly concerned about a potential "doom loop" stemming from France’s debt crisis and ongoing street riots, which could worsen borrowing costs and economic growth across Europe. Rising French bond yields, fueled by political polarization and protests, risk triggering broader financial instability affecting other Western economies like Italy.
• Schneider Electric’s chairman defended the company’s $22.6 billion acquisition of U.S. software maker PTC despite a sharp drop in Schneider’s stock price, citing a long-term strategic vision similar to a past successful acquisition that established its data center business. Investors remain cautious amid broader skepticism toward software sector deals.
• Global markets showed signs of recovery after a tech selloff triggered by revised, lower net revenue estimates for OpenAI, which dampened enthusiasm for the AI economy. Meanwhile, retail investors continued buying tech stocks, and analysts anticipate strong Q3 corporate earnings growth, with the S&P 500 expected to rise nearly 30% year-over-year.