The Week Ahead Of Us 🔍
Welcome back!
We had a shaky Friday after the AI trade weakened following Marvell’s softer than expected outlook, plus as rate hike odds surged. Futures are down slightly. Kevin Warsh gave his speech, and as usual, there was confusion. Warsh is saying all the things that imply a 25bps rate hike, but the market doesn’t fully believe him. 25bps hike odds are only at 48% per Polymarket. Normally, “If it looks like a duck, swims like a duck, and quacks like a duck, then it probably is a duck” but the lack of action in August, as well as the unprecedented closeness with the Administration (especially going into the Midterms) makes a hike less clear.
"If markets rely materially on the Fed's guidance and the Fed relies on market prices, we're more likely to be blinded to new developments, more likely to be caught unprepared, and more likely to commit errors in policymaking” - Kevin Warsh
Overall, we are not impressed with Warsh’s early reign thus far. His preference to run a quiet Fed lacks awareness that the Fed is meant to serve as a force of clarity. Without it, market narratives that do things like push the 10-year higher and prompt unprecedented Treasury intervention can happen.
Housekeeping note - we will be off Friday and push next Sunday’s piece to Monday night because of the holiday. Let’s get into it.
Here’s a look at earnings this week.
Monday: Science Applications International
Tuesday: Palo Alto Networks, Dell Technologies, MongoDB, NIO, GitLabs, Credo Technology, Medtronic
Wednesday: Snowflake, Broadcom, Hewlett Packard, NetApp, Five Below, Brown-Forman, Tilly's
Thursday: Ciena, lululemon, DocuSign, UiPath, Victorias Secret & Co., Lands' End, American Outdoor
Here’s a look at economic data this week (estimates are in quotations).
Monday: None scheduled
Tuesday: US Manufacturing PMI, ISM Report On Business Manufacturing PMI (55.1), Construction Spending (-0.1%), Job Openings & Labor Turnover Survey (7.4M)
Wednesday: ADP National Employment Report (45,000), Factory Orders (0.5%), Federal Reserve Beige Book
Thursday: U.S. Trade Balance (-89.7B), Weekly Jobless Claims (205K), US Services PMI, ISM Report On Business Services PMI (54.4)
Friday: Employment Report (50K), Unemployment Rate (4.1%), Avg Hourly Earnings, M/M% (0.2%), Avg Hourly Earnings, Y/Y% (3%)
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On The Move 📈 📉
Gap $GAP ( ▲ 12.94% ) jumped following the announcement of retail veteran Michael Francis as the next CEO of Old Navy, its largest brand. Francis had previously worked as CMO of Target and a key consultant for Walmart.
AI optics stocks $COHR ( ▼ 5.48% ) and $LITE ( ▼ 6.39% ) fell after investors decided Marvell’s $MRVL ( ▼ 10.28% ) Google custom-chip deal would take too long to move the numbers.
Solstice Advanced Materials $SOLS ( ▲ 12.76% ) surged after terminating its Element Solutions $ESI ( ▼ 4.35% ) acquisition and authorizing a $500M share buyback, its first as an independent public company since spinning off from Honeywell.
Sportsbook stocks $DKNG ( ▲ 4.29% ) and $FLUT ( ▲ 7.13% ) rallied after the Ninth Circuit ruled sports bets are not swaps, allowing Nevada to treat sports-prediction markets like Kalshi as unlicensed sportsbooks. Robinhood $HOOD ( ▼ 5.01% ) fell on the same ruling.
PayPal $PYPL ( ▼ 12.71% ) fell after Thursday night’s news that Stripe and Advent backed out of their $53Bn takeover bid. Mizuho cut PT to $51 (from $60) and Loop Capital to $50 (from $62).
Data center stocks $APLD ( ▼ 7.65% ), $CORZ ( ▼ 6.3% ), and $WULF ( ▼ 6.91% ) sold off after $IREN ( ▼ 12.53% ) booked a $638.8M impairment on obsolete mining hardware. Stretched valuations left the group with little cushion, with IREN at a 137x forward PE and APLD at 526x.
Elastic $ESTC ( ▲ 19.31% ) surged after a Q1 beat and raised FY27 guidance driven by AI-powered enterprise adoption. Morgan Stanley raised its PT to $75 from $66.
Sellas Life Sciences $SLS ( ▼ 13.15% ) fell after a German news report said the REGAL trial reached its 80th event trigger but the company has stayed silent. The drop unwound Thursday’s cancer vaccine rally.
IPO Roundup 📍
Electra Therapeutics filed for a US IPO to fund its clinical-stage pipeline for immune diseases and cancer. The San Francisco biotech’s lead drug, a monoclonal antibody for a rare hyper inflammatory syndrome, has FDA Breakthrough status.
Bamboo Insurance filed for US IPO to list on the NYSE as $BMB, following CVC’s $1.8B acquisition of the company a year earlier. The Utah-based homeowners insurance MGU grew written premium from $66.6M in 2022 to $696.1M in 2025.
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Today’s Headlines 📖🍿
PIMCO says a flood of AI-related debt issuance is causing “indigestion” in fixed-income markets, with CIO Marc Seidner saying “there’s too much, too fast” and that it pushed the 10-year Treasury to near a multi-year high of 4.75%. Still, the firm sees current yields as a “compelling entry point.”
Harvard economist Kenneth Rogoff warns that US fiscal reform will require a major shock, saying that “interest rates have reversed, but Washington hasn’t,” as national debt tops $40T and the 30-year Treasury hits multi-decade highs.
Jefferies flags a growing “zombie” problem in PE’s software portfolios: 18-22 investments 5-7 years in are stuck with no liquidity event in sight, no dividend recaps or continuation vehicles, and growth too slow to generate returns.
PIMCO’s Richard Clarida says Fed Chair Warsh’s Jackson Hole speech left little doubt a September rate hike is on the table. Warsh emphasized that inflation trends haven’t meaningfully improved and financial conditions aren’t restrictive, making the August CPI print the decisive data point before the Fed meets.
Syracuse University is facing an enrollment crisis that sent it into a 1.5% budget shortfall, as international enrollment fell by half in 2025 and only 21% of undergrads pay full sticker price (vs. 40-58% at peers like NYU, BU, and Northeastern). The school added $458M in debt for new dorms (prompting an S&P outlook downgrade to negative) and offered late “personal distinction awards” of up to $200k to fill the incoming class.
Acrisure’s $4.4B leveraged loan dropped 10% this month to ~83 cents as fallout from the Mark Walter/Guggenheim probe hits the insurance broker. Q2 EBITDA fell 12% to $345M and leverage reached 15.4x debt-to-earnings (including preferred equity).
Aon is nearing a deal to buy insurance brokerage USI from KKR for ~$17B. KKR acquired USI in 2017 alongside another firm for $4.3B, and the deal could be announced as soon as Monday.
OpenAI will end its Cursor usage following the acquisition by SpaceX by November 12, citing concerns that “SpaceX will use our technology within our terms of service.”
Blue Owl Capital led a $2.4Bn debt deal for Iren Ltd. to finance the purchase of Nvidia’s Blackwell Ultra GPUs for its Mackenzie data center campus in British Columbia.
Nvidia-backed Lambda raised $1B in private short-dated debt to finance Nvidia GPU purchases tied to its infrastructure collaboration with Microsoft.
Apple TV is raising prices from $12.99/month to $14.99/month, while the Apple One bundle rose from $19.95 to $21.95. The hike follows a July Apple Music price increase and comes as Apple bulks up its Apple TV content lineup.
Bain Capital’s Private Credit Group invested ~$6B in H1 2026 across 58 middle market and PE-backed companies. The group served as majority lender on 72% of new commitments and raised $2.2B in new capital.
Iceland rejected reopening EU accession talks by 52.8% to 47.2% as fishing industry control and national identity outweighed geopolitical concerns.
August 30th’s MVP 👑 - Tim Cook
Tomorrow is Tim Cook’s last day as CEO of Apple. Since Tim Cook was announced as CEO, Apple’s share price has risen by 2,270%.
Enjoy retirement Tim!
M&A Transactions💭
GeoPura, provider of renewable energy solutions, was acquired for $372.1M by Ballard Power Systems (TSE: BLDP). Barclays advised on the sale.
Elevate Semiconductor, manufacturer and provider of semiconductor solutions, was acquired for $250.0M by Diodes (NAS: DIOD). Bank of America advised on the sale.
Forte Biosciences (NAS: FBRX), a clinical-stage biotechnology company, was acquired for $1.58B by argenx (BRU: ARGX). Valuation / EBITDA was -18.28x. Guggenheim Partners advised on the sale.
InverCap Afore, asset manager, has entered into a definitive agreement to be acquired for $264.0M by Afore Coppel.
Pasqal (NAS: PSQL), developer of quantum computing systems, acquired Bleichroeder Acquisition II through a $360.0M reverse merger. Lazard and Lazard Frères advised on the sale.
Plus ES, provider of metering data and energy infrastructure services, has entered into a definitive agreement to be acquired for $2.12B by DigitalBridge Group (NYS: DBRG). EV/Revenue was 105.60x.
Private Placement Transactions💭
Ajaib Teknologi Indonesia, developer of a smart online investment platform, raised $270.0M of Series C venture funding from SBI Holdings and other undisclosed investors.
AusperBio, manufacturer of oligonucleotide-based therapeutics, raised $120.0M of Series C venture funding from InnoPinnacle, Hankang Capital, and CDH Investments.
Owner, developer of a digital marketing platform, raised $240.0M of venture funding led by Goldman Sachs Growth Equity at a pre-money valuation of $2.06B.
Sunrise (Hangzhou), manufacturer of artificial intelligence computing products, raised CNY 2.0B of venture funding from undisclosed investors at a pre-money valuation of CNY 18.0B.
Guanglianxin, manufacturer of optical interconnect technology, raised nearly CNY 1.0B of Series A+ venture funding from Beijing Xinglian Zhaoji Private Equity Fund Management, Zhao Hongxiu, Pei Zhenhua, Henan Ronghui Asset Management, and HSG (Hong Kong). GL Ventures, Legend Capital, China Life Investment Management Company, China Merchants Capital, and China Securities also participated in the round.
Odds of the Day 🍒
Polymarket traders are now pricing in a 48% chance of a 25bps rate hike in September.
Noteworthy Chart 🧭
A look at Software’s recovery since SaaSpocalypse 1.0
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Obviously, none of this constitutes financial or investment advice. *Today’s paid partner is Alumni Ventures. Today’s Odds of the Day is in paid partnership with Polymarket