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Microsoft is divesting console gaming streaming rights to persuade regulators to approve its Activision acquisition, S&P downgraded multiple banks, Schwab will cut staff, mortgage rates hit highest point since 2000, financial firms are being lured to the south, Meta is launching a web version for Threads, and companies are cutting pay for new hires.

The latest Axios Pro report surveyed hundreds of professionals across VC, PE and M&A to better understand how they're thinking about the current market. Check it out here.

Let’s dive in.

Before The Bell

Markets

• US stocks rallied, led by tech stocks, even as treasury yields surged to decade highs

  • The Nasdaq led indices with a 1.6% gain

• Shanghai’s SSE fell 1.2%, while Hong Kong’s HSI fell 1.8% after China’s central bank made smaller than expected rate cuts

• US 2Y yields topped 5%

• New Zealand’s dollar is on brink of longest-ever losing streak

Earnings

• Zoom shares rallied 5% after beating Q2 analyst adjusted earnings and revenue expectations and raising its 2024 forecast (CNBC)

• What we're watching this week:

  • Today: Baidu, Macy’s, Medtronic, Lowe’s, Dick’s, BJ’s 

  • Wednesday: Nvidia, Snowflake, Peloton, Kohl’s, Foot Locker

  • Thursday: Dollar Tree, TD Bank Group, Intuit, Workday, Affirm

• Full calendar here

Headline Roundup

• S&P downgrades multiple US banks, citing ‘tough’ operating conditions (RT)

• Schwab will cut staff, close offices to save $500M a year (BBG)

• A top-performing Chinese hedge fund blames global money for stock selloff (BBG)

• Google’s old guard shifts roles as the company searches for itself (CNBC)

• Mortgage rates hit their highest point since 2000 (CNBC)

• Financial firms are being lured towards the South (BBG)

• UBS ends Credit Suisse’s government and central bank protections (CNBC)

• Meta will launch a web version for Threads (WSJ)

• The worker bidding war is over. Companies are cutting pay for new hires (WSJ)

• China ramps up fight with Yuan bears to stop selloff spiraling (BBG)

• Market digests $1T jump in T-bill supply without hiccup (BBG)

• Car prices might be unsustainable for buyers (WSJ)

• Covid vaccine stocks jump as new variants emerge ahead of fall shot rollout (CNBC)

• Jeremy Grantham’s GMO files for first ETF to track quality stocks (BBG)

• Deepfake imposter scams are driving a new wave of fraud (BBG)

• Booming trade with China helps boost Russia’s war effort (WSJ)

A Message From Axios Pro

Thousands of data points on where dealmaking is headed.

In the latest Axios Pro report, we surveyed hundreds of professionals across VC, PE and M&A to better understand how they're thinking about the current market. Then, our industry-leading reporters aggregated and analyzed the data to help you navigate one of the toughest years on record. Download the report today, free.

Deal Flow

M&A / Investments

• Microsoft will give Ubisoft the cloud streaming rights for all of its Activision console games released over the next 15 years to placate regulators reviewing its $69B acquisition (BBG)

• UK’s CMA provisionally cleared Broadcom’s $61B acquisition of cloud computing firm VMware (BBG)

• Investment manager Fidelity International is searching for potential buyers for its $38.1B fund platform in Germany, FIL Fondsbank (BBG)

• Goldman Sachs is exploring a sale of its $29B investment advisory business, which it acquired 4 years ago (FT)

• PE firm Roark Capital, which owns restaurants Arby's and Buffalo Wild Wings, is nearing a deal to acquire Subway for ~$9.6B (RT)

• US shale operator Permian Resources will acquire Earthstone Energy in an all-share transaction valued at $4.5B, including debt (FT)

• Cybersecurity firm SentinelOne, which has a market cap of ~$4.2B, is exploring options including a potential sale (RT)

• UK PE firm Triton is struggling to sell British specialty pharma business Pharmanovia for $2.2B due to its valuation (BBG)

• PE firm The Jordan Company will acquire an 80.1% stake in DuPont’s resin unit Delrin at a $1.8B valuation (BBG)

• Norwegian energy company Equinor is exploring a sale of its Azerbaijan operations for ~$1B (BBG)

• Perenco, Ithaca Energy, and Viaro Energy submitted final bids for Shell’s southern North Sea gas fields, which are valued at $600M-$800M (BBG)

• Sculptor Capital Management received multiple takeover bids at $700M, higher than the $639M Rithm Capital will pay to acquire the hedge fund, including a bid by hedge fund investors Boaz Weinstein and Bill Ackman (BBG & FT)

• US insurance broker Marsh, a unit of Marsh & McLennan, will acquire Australia's Honan Insurance Group at an estimated $449M valuation (RT)

• Cargill, the world’s largest agricultural trader, agreed to buy 3 soybean processing plants and 4 storage facilities from Brazilian biodiesel maker Granol Industria Comercio e Exportacao to expand Brazilian operations (BBG)

• German auto parts supplier Continental is considering a sale of its car division currently bundled with ContiTech (RT)

VC

• Teamshares, a New York-based company dedicated to employee ownership of small businesses, raised a cumulative $245M in previously unannounced funding rounds, including a $124M Series D led by Frank Rotman at QED Investors (FN)

• Genesis Therapeutics, a Burlingame, CA-based AI tech company that specializes in medicines for patients with severe diseases, raised $200M in a Series B led by a16z Bio + Health and an unnamed US-based life-sciences-focused investor (FN)

• Anthropic, a San Francisco-based AI research company, raised $100M from SK Telecom Venture Capital (FN)

• Mycoprotein producer Enough raised a $51.13M through a funding round led by World Fund and CPT Capital (TC)

• Ghost, a members-only B2B marketplace for surplus inventory, announced it has raised $30M in a Series B led by Cathay Innovation (PRN)

• Prins AI, a provider of an AI-driven digital persona training product, closed a $22M Series A+ funding round (FN)

• Arccos, a Stamford, CT-based on-course tracking system and a leader in connected AI golf products, raised a $20M Series C led by PGA TOUR (FN)

• Zanifu, a Kenyan fintech providing inventory financing to micro, small, and medium-sized businesses, has raised $11.2M in debt/equity funding through a pre-Series A round led by Beyond Capital Ventures and Variant Investments (TC)

• Verdigris Technologies, a Moffett Field, CA-based provider of AI-powered energy management solutions, raised $10M in a funding round led by DCVC and Solea Energy (FN)

• Accure Battery Intelligence, an Aachen, Germany-based provider of predictive analytics software to ensure battery safety, raised $9.2M in a funding round led by Blue Bear Capital and HSBC Asset Management (FN)

• StoreConnect, a San Francisco-based customers commerce company, raised $9M in a seed round led by Bellini Capital (FN)

• BBT.live, developer of the BeBroadband SaaS platform, has extended its seed funding to $8.4M with Tzvi Neta leading the round (PRN)

• Astrocyte Pharmaceuticals, a clinical-stage drug discovery and development company, raised a $6M Pre-Series B round led by Dreavent Capital (FN)

• Kamma, a London-based property data and analytics company, raised $4.6M in funding led by Clean Growth Fund (FN)

• Mysthera Therapeutics, a Basel, Switzerland-based company developing oral therapeutics to treat complex autoimmune diseases, raised a $3.5M seed round led by Forty51 Ventures (FN)

• Braintrust Tutors, an NY-based provider of a tutoring platform for K-12 students, raised $2.5M in a seed round led by Scott Sandell, John Chambers, and LAUNCH (FN)

• Blended Sense, an Austin, TX-based media technology company for creative professionals, raised $2.5M in a seed round led by Terrence Murphy (FN)

• Writerly AI, a Nashville, TN-based provider of AI-powered writing tools, raised a $2M seed round (FN)

• Goodwings, a Copenhagen, Denmark-based provider of climate-focused SaaS travel management platform, raised a $1.5M seed round led by Global Cleantech and JTB USA (FN)

• American Battery Factory, an emerging battery manufacturer developing the first network of LFP battery cell gigafactories in the US, raised ‘significant development capital’ through a Series A led by Lion Energy (PRN)

IPO / Direct Listings / Issuances / Block Trades

• SoftBank Group’s semiconductor unit Arm filed for the year’s largest US IPO public offering, disclosing its financials and performance (BBG) 

• SF Holding, China’s largest courier service, filed for a Hong Kong second listing that could raise $2B-$3B (BBG)

SPAC

• Scage International, a Nanjing-headquartered zero emission solutions provider for heavy duty commercial vehicles, will merge with Finnovate Acquisition Corp. at a $1B post-combination valuation (BZ)

Debt

• Chevron terminated its exchange offer for $750M worth of PDC Energy’s bonds after failing to secure consent from debt holders (RT)

• Nikola stock fell 23% after it announced that it would raise up to $325M through a convertible bond sale (BRRN)

Bankruptcy / Restructuring

• DP Eurasia, an operator of Domino’s, will file for bankruptcy for its Russian business and exit the country (RT)

Fundraising

• Blackstone raised $5.2B for its Blackstone Tactical Opportunities Fund IV, surpassing its $4B target (BBG)

• Algoma Capital is launching a $100M credit fund to provide working capital for business growth to whiskey brands and distilleries (BZ)

Crypto Corner

• Fintech investment adviser Titan Global Capital Management will pay a $1M settlement to the SEC over accusations that it misled investors about performance metrics (RT)

• Coinbase will acquire a minority stake in stablecoin USDC operator Circle (CD)

Exec’s Picks

• From comprehensive compliance policy templates to over 150 integrations with your core technology services, the Secureframe platform significantly increases the speed with which organizations can confidently begin a SOC 2 audit, without increasing overhead or slowing your team down. Schedule a personalized demo let us show you how.

• Byrne Hobart discussed whether or not we should expect stock valuations to mean revert.

• The Economist published a piece explaining how greying economies experience less innovation.

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