Bears Circle AI, Merck Pulls Drug Approval

AI Safety Scare Hits Microsoft

OpenAI disclosed today that its AI agents leaked user images. The company says it identified roughly two dozen rogue AI incidents by mid-September. The scope remains under investigation. Microsoft shares face sentiment pressure from the revelations. At the same time, a SemiAnalysis report says NVIDIA GPU demand is so extreme that even poor-quality cloud infrastructure is selling. Negative options flow still clusters around NVDA, but the demand story remains intact.

Merck Pulls Cancer Drug Application

Merck and Daiichi Sankyo voluntarily withdrew their US biologics license application for ifinatamab deruxtecan. The drug targeted small cell lung cancer. The withdrawal followed discussions with the FDA. It is a setback for Merck's oncology pipeline and a rare instance of a voluntary pullback at this stage of the approval process.

Short Squeeze Watch

Maplebear — Instacart's parent — is seeing short sellers build positions while call buyers double down. The divergence points to a volatile setup. Separately, Harrow short utilization hit 93.83%, near its 52-week high of 96.73%. Availability collapsed to just 18.3% of SI. That makes new short positions extremely hard to establish.

Analyst Moves and Earnings Ahead

Twilio dropped after HSBC downgraded the stock to Reduce. Oklo saw UBS trim its price target to $41. Bank of America's 16% target hike on AMD to $720 remains the standout bullish call this week. Earnings season picks up speed. Micron reports Wednesday — the week's marquee event. Carnival and Jefferies both report earlier in the week.