Market Beats | US inflation rises in August; Rifle Recovered in Charlie Kirk Shooting Case; Sotheby’s Loss Doubles Amid Global Art Market Slump; NYC Mayor Adams Weighs Dropping Out; Paramount Plans Bid for Warner Bros. Discovery; US Mortgage Rates Drop Sparks Refinancing Surge

—— US inflation rises in August; Rifle Recovered in Charlie Kirk Shooting Case; Sotheby’s Loss Doubles Amid Global Art Market Slump; NYC Mayor Adams Weighs Dropping Out; Paramount Plans Bid for Warner Bros. Discovery; US Mortgage Rates Drop Sparks Refinancing Surge

1. US inflation rises in August

The US core consumer price index (CPI), which excludes food and energy, rose 0.3% in August from July, in line with expectations. The overall CPI climbed 0.4%, the biggest increase since the start of the year, highlighting lingering inflationary pressures.

Goods prices excluding food and energy rose 0.3%, driven by gains in new and used cars, apparel, and appliances. Service costs also accelerated, with airfares posting the largest increase in more than three years. Household expenses including groceries, gasoline, electricity, and car repairs also rose. President Donald Trump’s global tariffs are adding pressure to goods prices, while persistent service inflation is contributing to broader upward pressure.

Despite firm inflation, weak labor market data has kept the Federal Reserve on track to cut rates at its Sept. 16-17 meeting. Policymakers are expected to deliver the first cut of the year, with traders anticipating two more reductions before year-end.

Separately, initial jobless claims rose last week to the highest level in nearly four years, though holiday effects likely contributed. The Fed will also see fresh data on consumer sentiment and retail sales before next week’s meeting, which could influence the pace of rate cuts.

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2. Rifle Recovered in Charlie Kirk Shooting Case

US federal investigators have recovered what they believe to be the rifle used to fatally shoot conservative activist Charlie Kirk during a campus event in Utah, as the manhunt for the gunman entered its second day.

Robert Bohls, special agent in charge of the FBI’s Salt Lake City field office, said the high-powered bolt-action rifle was discovered in a wooded area near Utah Valley University, where the shooter fled after the attack. The weapon, along with footwear impressions and palm prints collected at the scene, has been sent to the bureau’s lab for forensic analysis. Authorities said the assailant appeared to be of college age, blended into the campus, then climbed to a rooftop firing position before escaping into a nearby neighborhood. Investigators recovered an older imported Mauser rifle wrapped in a towel along the gunman’s escape route, with one spent cartridge still chambered and three unfired rounds in the magazine.

The rifle has been turned over for DNA and fingerprint testing. The FBI said it has received more than 130 tips and appealed to the public for additional photos and videos. Bohls stressed the case is being treated as an attack on free speech, stating: “Any attack on the First Amendment is an attack on the very foundation of our democracy.”

Utah Public Safety Commissioner Beau Mason urged caution against speculation, noting that two individuals initially questioned were cleared of involvement but faced harassment after their names circulated.

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3. Sotheby’s Loss Doubles Amid Global Art Market Slump

Sotheby’s annual pre-tax loss more than doubled to $248 million in 2024, as billionaire Patrick Drahi’s auction house continued to struggle amid a prolonged downturn in the global art market.

Drahi, who acquired Sotheby’s through a leveraged buyout in 2019, saw the company’s losses deepen from $106 million in 2023, according to filings from its Luxembourg-based parent company. The broader fine art market slumped, with global sales falling 12% to $57.5 billion, driven by weaker demand from high-spending Asian buyers and US uncertainty. The number of lots fetching above $10 million fell 39%.

Revenue from commissions and fees fell 18% to $813 million in 2024, down from $994 million the previous year. Sotheby’s overall sales fell 23% to $6 billion, while rival Christie’s declined 6% to $5.7 billion. Unlike Christie’s, which reported an 18% increase in pre-tax profit to £85 million, Sotheby’s UK holding company saw profit fall 21% to $27 million.

The auction house has been reducing staff since 2020, with severance costs rising to $29.2 million in 2024 from $11.4 million the year prior, even though headcount only fell by 24 to 2,218.

In August 2023, Abu Dhabi sovereign wealth fund ADQ and Drahi injected $1 billion of capital into Sotheby’s. ADQ invested $909 million for a 24% stake in Sotheby’s UK holding company, along with preferred stock and warrants, and pledged an additional $75 million if adjusted EBITDA surpassed $300 million in 2024. Drahi’s BidFair contributed $85 million.

The proceeds helped Sotheby’s repay $794 million in debt and purchase new headquarters on Madison Avenue in New York, reducing long-term net debt to $2.76 billion from $3.55 billion. However, the company shut down its China e-commerce business less than two years after launching it, signaling challenges abroad.

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4. NYC Mayor Adams Weighs Dropping Out

New York City Mayor Eric Adams told civic and business leaders he is conducting his own polling to decide the future of his reelection campaign, hinting at possibly dropping out just days after vowing to stay in the race.

Adams made the remarks to about 20 members of the Association for a Better New York, saying he would ultimately do what he sees as best for the city despite his dislike for former Governor Andrew Cuomo, one of his opponents. According to attendees, Adams said he plans to run his own polling in the coming weeks, which some interpreted as a sign he might exit the race. Socialist candidate Zohran Mamdani currently holds a large lead in polls. While surveys show Cuomo could fare better against Mamdani if Adams and Republican Curtis Sliwa withdraw, Adams insisted last week that he’s “going to beat Mamdani.”

Campaign spokesman Todd Shapiro denied Adams suggested leaving the race, saying the mayor only indicated he would invest in getting his message out and then review independent polling before deciding. Reports have circulated that Adams has been weighing job offers from the Trump administration and private sector in exchange for dropping out.

Recent polls show Adams stuck in fourth place in a four-way contest. An Emerson College poll released Wednesday put Mamdani at 43%, Cuomo at 28%, Sliwa at 10% and Adams at 7%. In a hypothetical head-to-head, Mamdani would beat Cuomo by just seven points.

Some donors and private sector executives worried about a Mamdani victory have also been in discussions with Adams about potentially offering him a job to encourage him to exit the race.

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5. Paramount Plans Bid for Warner Bros. Discovery

Paramount Skydance Corp., the Hollywood studio taken over in August by filmmaker David Ellison, is preparing a bid to acquire rival Warner Bros. Discovery Inc., according to a person familiar with the matter.

The mostly cash offer would be for the entire company, the Wall Street Journal reported Thursday, though terms were not disclosed. Warner Bros. had announced last year it would restructure into two divisions, one focused on cable TV and the other on streaming and studios.

The Paramount bid is backed by the Ellison family. David Ellison’s father, Larry Ellison, co-founder of Oracle Corp. and the world’s second-richest man with a $383 billion fortune, is supporting the move. Paramount declined to comment, while Warner Bros. did not immediately respond.

Paramount owns CBS, MTV and the Paramount+ streaming platform in addition to its film and TV studios. Warner Bros. also produces film and TV content and operates CNN, HBO and the HBO Max streaming service.

Following the news, Warner Bros. shares surged as much as 27% to $15.97 in New York, while Paramount shares dropped more than 7% to $10.87.

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6. US Mortgage Rates Drop Sparks Refinancing Surge

US mortgage rates fell by the most in a year, fueling a surge in refinancing demand from homeowners eager to save money.

The average 30-year fixed mortgage rate dropped to 6.35% from 6.5% last week, Freddie Mac reported. Borrowing costs, which have been trending lower for months, took another leg down after Friday’s disappointing jobs report boosted expectations for further Federal Reserve rate cuts.

By Monday, consumers could lock in 30-year rates at 6.27%, the lowest in nearly a year, according to Optimal Blue. The next day, as rates ticked up, rate lock volumes surged to the highest single-day level since 2022. “This may indicate homebuyer eagerness to lock in rates before further climbs,” said Mike Vough, head of corporate strategy at the mortgage tech firm.

At a 6.5% average rate, about 2.5 million US borrowers were “in the money” to refinance, meaning they could lower their rate by at least 75 basis points, according to ICE Mortgage Technology. If rates fall further to 6.125%, that figure could double to 5 million.

“It’s go-time for the refinancing industry,” said Kevin Peranio, partner at Paramount Residential Mortgage Group. He added that falling rates will also spur more home purchases. To prepare, his company is hiring 20 underwriters in the US and 15 more offshore in India.

“Low rates are the cure for so much,” Peranio said. “Unlike last year when improvements only lasted a day or a week, this time it’s been months — and I think it’ll continue for months ahead.”

Joby agreed in August to buy Blade’s helicopter business for up to $125 million, leaving Blade’s medical transport division as a standalone public company. Founder Rob Wiesenthal continues as CEO of the helicopter unit.

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7. Apple launches ultra-thin iPhone Air while holding prices steady

Lenders to luxury fashion retailer Ssense are asking a Canadian court to approve a quick sale of the cash-strapped company, with first bids due in early October.

A group led by Bank of Montreal filed an application to the Quebec Superior Court, saying creditors had lost confidence in Ssense’s ability to oversee operations. Other lenders include Royal Bank of Canada, JPMorgan Chase, National Bank of Canada, and Bank of Nova Scotia, with total debt of about C$145 million ($105 million).

Creditors want the company placed under court supervision via Canada’s Companies’ Creditors Arrangement Act. They are pushing for a fast-track sale process, with potential buyers contacted next week and non-binding bids due by Oct. 6. They’ve also proposed selling inventory this month to raise cash.

Ssense, once a Montreal family-run success story valued at more than C$5 billion in 2021, is now threatened by debt and eroding trust.

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