markets

Claire Yubin Oh10/2/25

Credit bureaus sink as FICO launches a direct program for FICO scores, eliminating reliance on credit bureaus

Nationwide credit bureaus Equifax and TransUnion are down 11% and 5% in premarket trading on Thursday, respectively, after Fair Isaac Corp. announced a new program to enable tri-merge resellers to directly distribute FICO scores to customers.

Dublin-based Experian PLC also dropped as much as 5% on the news.

Per FICO’s press release: “With the launch of the FICO® Mortgage Direct License Program, tri-merge resellers have the option to calculate and distribute FICO Scores directly to their customers, eliminating reliance on the three nationwide credit bureaus. This shift will drive price transparency and immediate cost savings to mortgage lenders, mortgage brokers, and other industry participants.”

Through this streamlining effort, resellers that buy and merge reports from Equifax, TransUnion, and Experian into one would rely less on these intermediaries in the chain to directly distribute their FICO scores. In effect, FICO hopes to eliminate “unnecessary mark-ups on the FICO Score” and put “pricing model choice in the hands of those who use FICO Scores to drive mortgage decisions,” according to Will Lansing, chief executive officer of FICO.

FICO calculates this shift will reduce the average fee per score by some 50%, with the royalty fee under the new model set at $4.95 per score, compared to the $10 fee per score in the previous system. Once a FICO-scored loan is closed under the new Mortgage Direct License Program, a funded loan fee of $33 per borrower per score will be applied additionally.

Despite the new program, firms can continue to still work through the credit bureaus if preferred.

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Broadcom jumps after locking down Google as a customer for future generations of TPUs

Shares of Broadcom rose more than 3% in postmarket trading on Monday after its most important customer doubled down on the custom chip specialist’s ability to produce its most valuable commodity.

In a filing, Broadcom said that it entered into a long-term agreement with Google to supply future generations of TPUs (custom AI accelerator chips) as well as a supply assurance agreement for networking and other equipment “through up to 2031.”

Bernstein analyst Stacy Rasgon indicated that Broadcom’s investor relations team told him that Google’s long-term agreement “has revenue commitments that go along with it through the timeline.”

Gemini 3 launched to rave reviews in November. The model was trained on TPUs co-developed by Broadcom and Google.

The same Monday filing showed that Broadcom, Google, and Anthropic expanded a partnership that will see the Claude developer access 3.5 gigawatts of AI compute capacity beginning in 2027, powered by the TPUs co-designed by the custom chip specialist and the search giant.

Bernstein’s Rasgon added that Broadcom’s team suggested these 3.5 gigawatts are “only part of a larger partnership over time.” He thinks Broadcom’s fiscal year 2027 guidance for AI revenues of $100 billion “is looking increasingly light” thanks to this news.

For what it’s worth, the enhanced pact with Anthropic hinges upon the firm’s ability to afford AI compute. But based on the insane trajectory of its run-rate revenue that may not be a big hurdle to clear.

“Broadcom’s expanded agreements with Google and Anthropic add rare multi-year visibility, reinforcing a $40-$50 billion AI revenue opportunity tied to Anthropic’s 3.5 gigawatt deployment starting in 2027, while building on the previously disclosed 1GW ($10 billion) starting in 2H,” wrote Bloomberg Intelligence analysts Kunjan Sobhani and Oscar Hernandez Tejada.

Anthropic boasts revenue run rate of $30 billion as the Claude developer expands its partnership with Google and Broadcom

Anthropic’s revenue run rate is higher than the trailing 12-month revenues of all but 129 S&P 500 companies.

Anthropic Co-founder and CEO Dario Amodei

markets

Health insurers surge after Medicare agrees to pay 2.48% more in 2027, a bigger-than-expected boost

Health insurance stocks are surging after the Centers for Medicare & Medicaid Services said it plans to boost Medicare Advantage and Part D payments by 2.48% in calendar year 2027.

The likes of CVS, Humana, UnitedHealth, Molina Healthcare, Oscar Health, and Elevance Health are gaining in postmarket trading.

Wall Street analysts had anticipated that rates for 2027 would go up between roughly 1% and 1.5%.

These stocks had gotten crushed in late January when the Trump administration proposed relatively flat federal payment rates.

Insurance companies that provide government-sponsored plans, like Medicare Advantage, faced headwinds from higher-than-expected costs in 2025.

Luke Kawa, Tasha Matsumoto

Stocks maintain gains after whipsawing as traders digest war updates

Stocks rose for the fourth consecutive session as traders vacillated between hopes for a ceasefire and fears of an escalation.

Bull kicks

markets

Matt Phillips17h

Iran war winners Dow, LyondellBasell downgraded by Bank of America

Dow, Inc. and LyondellBasell — two petrochemicals stocks that surged as markets priced in shortages due to the closure of the Strait of Hormuz — should decline as investors focus on the long-term outlook for normalized petrochemical prices once the war resolves, Bank of America analysts wrote in a note downgrading the two stocks Monday.

BofA moved its rating on the shares from “neutral” to “underperform,” writing:

“Over time, as chemical markets normalize, we expect 1) investor focus to shiﬅ back to ‘normal’ or ‘sustainable’ earnings profiles and 2) the conflict to resolve without material asset rationalization, both of which likely bias shares lower over the next twelve months.”

Analysts also lowered their stance on another petrochemicals and building materials stock, Westlake, to “neutral” from “buy.”

While cutting those ratings, BofA actually raised its more near-term price targets for the shares. It upped LyondellBasell to $68 from $55, and Dow to $35 from $31.

But those price targets still imply declines of more than 10% compared to where both shares were trading late Monday morning. Both stocks are up roughly 30% since the start of the Iran war.

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