Good morning. It’s a risk-off day with a capital R.

European bourses are having their worst day since May as COVID cases hit fresh records and new closures and curfews are in the works. The U.S. futures too are sinking. Microsoft’s muted outlook yesterday is weighing on tech futures, with one prominent investor warning we’re staring at an “enormous” bubble for tech stocks. More on that below.

Let’s see what else is moving the markets.

Markets update

Asia

• The major Asia indexes are mixed in afternoon trading with the Shanghai Composite the best of the bunch, up nearly 0.5%.
• A special g’day to our friends in Melbourne, Australia. They emerged today from one of the world’s longest and strictest lockdowns, one that offers stark lessons about the economic toll of shutting nearly everything down to combat the virus.
• Don’t get CNN’s Fareed Zakaria started on the logic of lockdowns. They “are a sign you have failed,” he told the virtual attendees of the Fortune Global Forum yesterday. “You are using a big blunt instrument, and you are crushing the economy.”

Europe

• The European bourses are bombing out of the gates with Paris and Frankfurt down roughly 3% a half-hour into trading as speculation is rife of further lockdown measures across both countries.
• In the past 24 hours, France and the U.K. reported the most COVID deaths since the spring, and hospital beds are filling up in both countries.
• Shares in Heineken were down 2% at the open after the world’s second largest brewer announced layoffs and was unable to provide investors a full outlook for the year ahead.

U.S.

• U.S. futures are sliding, in line with European shares. The Dow shed 222 points on Tuesday. It is now down 1.1% this month.
• More bad news for the bulls: you can forget about an imminent stimulus deal.
• Shares in Microsoft are down 1.7% in pre-market after the tech giant delivered an unenthusiastic top-line outlook. That’s weighing on Nasdaq futures this morning, off more than 1%, and falling.

Elsewhere

• Gold is down, trading again today just above $1,900/ounce.
• The dollar is up.
• Crude is having another bad day, with Brent at one point trading below $40/barrel.

***

Enormous bubble?

Every time I glance at Nasdaq futures this morning, the picture looks worse.

But is it as bad as David Einhorn says, that we’re staring at “enormous” bubble in tech stocks? According to Bloomberg, the head of hedge fund Greenlight Capital wrote in an Oct. 27 investor note that “Our working hypothesis, which might be disproven, is that September 2, 2020 was the top and the bubble has already popped.

“If so,” he continues, “investor sentiment is in the process of shifting from greed to complacency.”

A refresher: On Sept. 2, the tech-heavy index hit a mid-day, all-time high of 12,439.48. It’s fallen 6.7% since then (as of yesterday’s close), and is off a further percentage point in pre-market trade this morning. YTD, however, the Nasdaq 100 is up a frothy 32.8%. That’s way out of whack when compared to just about everything else in the world of equities.

Meanwhile, the S&P 500 is up just under 5% YTD. It too hit an all-time high on Sept. 2, only to shed 5.5% since then.

Back to Einhorn… he finds a bunch of red flags in the rise of tech stocks, particularly in tech IPOs and the mid-cap tech stocks that carry enormous valuations. As Bloomberg notes, Einhorn has long held short positions on Nasdaq big caps like Amazon and Netflix.

To the surprise of no-one, Einhorn’s short strategy hasn’t worked out so well. His fund is down 16% YTD.

So, place him in the tech skeptic corner.

For the tech bulls, this is a good week to evaluate your positions. Microsoft delivered its quarterly results yesterday, and the other members of the FAAMG quintet come out tomorrow.

Judging by Microsoft’s mixed report yesterday, there could be some fireworks here; another thing to ponder ahead of Election Day.

***

Postscript

I don’t care if Monday’s blue
Tuesday’s grey and Wednesday too
Thursday, I don’t care about you
It’s Friday…

When I was living in London, writing at that point about tech and music for Reuters, I blagged tickets to an invite-only tribute concert for Robert Smith. I think this would have been 2004.

The Cure front man sat in the front row, surrounded by family and friends. Despite pleas from the crowd, he never left his seat. He watched other musicians jam, and perform his songs.

Probably the weirdest concert I’ve ever attended.

Still, The Cure tune popped into my head as I was glancing at stock futures while walking the dog this morning.

And that’s how the newsletter magic happens around here.

***

Have a nice day, everyone. I’ll see you here tomorrow. 

Bernhard Warner
@BernhardWarner
Bernhard.Warner@Fortune.com

As always, you can write to bullsheet@fortune.com or reply to this email with suggestions and feedback.

Today's reads

On the ballot. From the possible legalization of marijuana (six states, including New Jersey) to income tax changes (Illinois) to a minimum wage hike (Florida), there are a score of ballot measure initiatives up for a vote this Election Day. Fortune rounds them all up, and details which ones are most important for business.

Trickle down. So far on the campaign trail, we've heard the boasts and the barbs of President Trump's Tax Cuts and Jobs Act of 2017. Was it a boon for American families, or just a big gift for the ultra wealthy? Peter Coy, economics editor of Bloomberg Businessweek, digs into the details, and finds that all income brackets did indeed benefit to some degree. Spoiler: the top 1%, on relative terms, make out the best from the TCJA. Our grandkids, left with staggering deficits, not so much.

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Market candy

Quote of the day

It’s called state capitalism, but they’ll produce more billionaires [than the U.S.]... I think capitalism and the development of the capital markets could, in a few years, be more embraced in China than they are in the U.S.

That's hedge fund king Ray Dalio, speaking yesterday at the Fortune Global Forum. The head of Bridgewater Associates, the world's biggest hedge fund, believes China is well on its way to leapfrogging the United States as the world's preeminent economic power. Here's why.