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Good Morning,

St. Louis Fed President Jim Bullard is stepping down, the US deficit jumped to $228B in June, a UPS strike would be perilous to US supply chains, Meta is releasing a commercial AI model, the FTC is investigating ChatGPT, a Stability AI co-founder got hosed on his equity, and Twitter is now sharing ad revenue with creators.

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Let’s dive in.

Before The Bell

Markets

• US stocks continued this week’s rally yesterday after investors digested further optimistic inflation data and a stronger-than-expected start to earnings season

  • Nasdaq 100 notched its best ever H1 performance

• Asian stocks rose early today on course for their best week this year

• Money market traders see a 20% chance of another Fed rate hike to follow one this month

• Crude oil rose to the highest in nearly three months

• Gold is on track for its best week in three months

• Dollar index sank to a fresh 15-month low and is on track for its worst week since November

• Yen is headed for its longest rally since 2018

• Crypto/related stocks rallied after a landmark court judgement for Ripple Labs

Earnings

• Pepsi posted a Q2 beat and raise thanks to price increases on various lines of products and new innovations in the Frito-Lay division (YF)

• Delta posted record-high Q2 earnings and revenue thanks to scorching international travel demand that has defied fears of an economic slowdown for months (CNBC)

• What we're watching this week:

  • Today: JPMorgan, Wells Fargo, Citigroup, BlackRock, State Street, UnitedHealth

• Full calendar here

Headline Roundup

• St. Louis Fed president Jim Bullard is stepping down (CNBC)

• Australia picked Michele Bullock to lead central bank after sacking incumbent Philip Low (CNBC)

• Cost of servicing US debt jumped 25% from Q1-Q3 (BBG)

• US posts sharply higher $228B June deficit (RT)

• UK retail investors are dumping equity funds for debt funds (FT)

• SEC adopted new rules for money-market funds (WSJ)

• China exports fell at fastest YoY pace since Covid in June (RT)

• UPS strike could be costliest in US in a century (RT)

• Meta to release commercial AI model in effort to catch rivals (FT)

• FTC is investigating ChatGPT over unfair/deceptive practices (WSJ)

• Google announced numerous updates to Bard in race versus ChatGPT (WSJ)

• Stability AI co-founder was allegedly duped into selling stake for $100 (FT)

• Q2 biotech/pharma VC funding was lowest since the pandemic (BJ)

• Sapphire Ventures plans to invest over $1B in enterprise AI startups (RT)

• FDA approves first over-the-counter birth-control pill (WSJ)

• Tesla looking to make about 500k EVs annually in India (RT)

• Microsoft under fire after hacks of US State and Commerce departments (RT)

• 160k Hollywood actors strike (NYT)

• Twitter to offer ad revenue share to select content creators (RT)

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Deal Flow

M&A / Investments

• A judge rejected the FTC’s request to temporarily block Microsoft’s $69B acquisition of Activision Blizzard; FTC appealed the ruling (BBG)

• French Billionaire Pinault is in talks to buy CAA Talent Agency in a $7B deal (BBG)

• Roivant Sciences is nearing a sale of its experimental stomach disease drug RVT-3101 to Swiss multinational healthcare company Roche Holding in a deal that could be worth over $7B (WSJ)

• Exxon Mobil agreed to buy Denbury for $4.9B to expand its carbon capture business (RT)

• Carlyle Group and Trustar Capital are in talks to raise $4B through a partial sale of their stakes in Hong Kong and Chinese McDonald’s operations to sovereign wealth funds GIC and Mubadala Investment in a deal that will value the entire business at $10B (BBG)

• Asian data center operator and designer Chindata Group Holdings says its largest shareholder Bain Capital does not plan on selling any shares; Chindata has $2.9B and $3.4B take private offers from Bain and state-run China Merchants Capital (RT)

• Indonesian logistics and marine shipping business Meratus is exploring a sale for ~$2B after interest from investors (BBG)

• 3D printer manufacturer 3D Systems greatly increased its offer to buy rival Stratasys for $1.6B in a cash-and-stock deal after two previous offers were rejected (BBG)

• PE firm CapVest Partners has agreed to acquire UK software provider Kerridge Commercial Systems in a $1B deal (BBG)

• Alternative investment firm Varde Partners bought $1B of consumer loans from Goldman Sachs’ consumer unit Marcus (RT)

• Indian conglomerate Nirma and Sekhmet Pharmaventures are among bidders competing for a $731M, 83% stake in Glenmark Pharmaceuticals (BBG)

• Carmaker Nissan will invest $725M in French multinational carmaker Renault’s EV unit, Ampere (RT)

• Barclays is preparing a sale of its German consumer-finance business and may seek ~$557M for the unit (BBG)

• AG Mortgage Investment Trust, a REIT backed by Angelo Gordon & Co, made a ~$300M stock-and-cash offer for peer Western Asset Mortgage Capital, which is managed by Franklin Resources (RT)

• India’s third-largest IT services company HCL Technologies is acquiring German automotive engineering company ASAP Group for $231M (BBG)

• Saudi Arabia's sovereign wealth fund PIF, who owns of Premier League team Newcastle United FC, is interested in buying another top European football club (BBG)

• UK’s TalkTalk Telecom is looking for investors in its wholesale unit and looking to sell its B2B Direct unit to help pay down debt (BBG)

• Mexico is no longer interested in buying Citigroup's local retail unit Banamex (RT)

VC

• AI startup Hugging Face is raising a ~$200M Series D at a $4B valuation led by Sound Ventures (FRB)

• Avnos, a startup developing hybrid direct air capture tech for CO₂ removal, raised $80M in funding from ConocoPhillips, JetBlue Ventures, and Shell Ventures (BW)

• Causaly, an AI platform for drug discovery and biomedical research, raised a $60M Series B led by ICONIQ Growth (TC)

• HawkEye 360, a company that provides geospatial intelligence from space, raised a $58M round led by BlackRock (TC)

• Cybersecurity startup Secure Code Warrior raised a $50M Series C led by Paladin Capital Group (TC)

• In-store inventory tracking platform RADAR raised a $30M Series A led by Align Ventures (BW)

• Inventory robotics startup Simbe Robotics raised a $28M Series B led by Eclipse (TC)

• Parker Health, an innovative biotech company for electronic health records, hospital developers, and management raised a $25M Series A led by Bias Capital (BW)

• MerQube, a provider of index-linked investing technology, raised a $22M Series B led by Intel Capital (FN)

• Zluri, a SaaS operations platform, raised $20M in funding led by Lightspeed (FN)

• Mattilda, a Mexican startup providing collections management and payment processing for private schools, raised a $19M Series A led by GSV Ventures (TC)

• Spline, a no-code design tool for creating 3D assets, raised a $15M seed round led by Gradient Ventures (TC)

• Trunk Tools, a construction-focused fintech startup, raised a $9.9M seed round led by Innovation Endeavors (BW)

• Passes, a Miami-based provider of an invite-only brand-friendly paywall platform, raised a $9M seed round led by Multicoin Capital (FN)

• Efficient Capital Labs, a fintech startup providing non-dilutive capital to B2B SaaS companies in the South Asia-US corridor, raised a $7M pre-Series A led by QED Investors (BW)

• Blockchain employment platform Opolis raised a $6.6M bridge round led by Greenfield (BW)

• Tangibly, a SaaS trade secret management platform, raised a $6.5M seed round led by Madrona (BW)

• Capstack, a provider of an integrated OS for banks, raised a $6M pre-seed round led by Fin Capital (FN)

• LunarCrush, a social media analytics startup for cryptocurrency and financial industries, raised a $5M Series A at a $30M valuation led by Draper Round Table / INCE Capital (FN)

• Aktivate, a provider of scholastic sports management software, raised a $3.7M Series A led by Will Ventures, Tal Ventures, and Benson Oak Ventures (FN)

• Data security startup Teleskope raised a $2.2M pre-seed round led by Lerer Hippeau (BW)

• WaitWell, a startup providing service optimization products, raised a $1.5M seed round led by Graphite Ventures and Accelerate Fund III (FN)

IPO / Direct Listings / Issuances / Block Trades

• Canned water company Liquid Death hired Goldman Sachs to lead on a potential 2024 IPO (TI)

Debt

• The Philippines is planning to raise $1B in its first Islamic bond sale (BBG)

• Indian conglomerate Adani Enterprises raised ~$152M through a local-currency bond sale (TI)

Bankruptcy / Restructuring

• Distressed Indonesian airline Sriwijaya Air won regulator approval to restructure up to $488M of debt (BBG)

• Carlyle Group is considering handing portfolio company Praesidiad Group to debtors as part of a debt restructuring (BBG)

• China's Guangzhou R&F Properties creditors have sued the property developer to seek bankruptcy restructuring (RT)

• Dutch e-bike maker VanMoof filed for protection from creditors (RT)

Fundraising

• Wing Venture Capital closed a $600M fund to invest in startups that build AI tools for businesses (BBG)

• Climate-tech VC Azolla Ventures closed its $239M blended fund to invest in pre-seed, seed and Series A startups (TC)

• OpenAI is looking to raise a second VC fund, larger than its $175M debut fund (TI)

Crypto Corner

• Celsius' ex-CEO Alex Mashinsky arrested on fraud charges as FTC lines up $4.7B fine (TV)

• A US judge ruled that Ripple Labs did not violate securities laws by selling its XRP tokens on public exchanges (RT)

• Coinbase soared 25%, the most since its debut, after Ripple ruling (BBG)

• India's largest private lender HDFC Bank signed up 100k and 170k merchants in pilot programs in using the central bank digital currency (RT)

Exec’s Picks

• Jack Raines wrote about whether or not Threads poses an existential threat to Twitter.

• This Variety piece details how the writers’ strike shows an entertainment industry in free fall.

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