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Good Morning,

Elliott is going after PE firms, Goldman posted its best trading quarter ever, JPMorgan is now worth more than its three largest rivals combined, US stocks overtook Europe's benchmark YTD, and Trump secretly considered firing J Pow.

Trump also said Coca-Cola agreed to use real cane sugar in US. Seems he's doing everything to distract from the Epstein Files…

Mizuho Americas head of IB Michal Katz recently sat down with Sam Altman to discuss advancements in AI and its implications for the broader energy sector. Take a listen to some of his insights.

Let's dive in.

Before The Bell

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Markets

• US stocks rose as traders digested strong earnings reports and rumors of Trump's plans to fire J Pow

• Europe's Stoxx 600 fell for a fourth-straight day amid glum earnings

• S&P 500 overtook Stoxx 600 YTD

• Hong Kong's Hang Seng index is up 25% YTD at a three-year high 

• Iron ore rose post $100/ton for the first time since May on improving China growth sentiment

• Pound fell for a ninth-straight day for its longest losing streak in a decade

Earnings

• Bank of America missed Q2 revenue estimates but beat on earnings as IB, fixed income trading, and equities trading generally matched Wall Street expectations; the firm sees resilient consumer spending, asset quality, and rising commercial borrower utilization (CNBC)

• Goldman Sachs crushed Q2 estimates on its best stock trading quarter ever amid tariff-driven volatility; IB fees jumped 26% YoY, though asset and wealth management revenue fell 3% as the bank's sole Q2 laggard (CNBC)

• Morgan Stanley also crushed Q2 estimates on the back of stellar trading, a four-year high in equities underwriting, and strong results in wealth management (CNBC)

• ASML beat Q2 revenue, earnings, and net bookings estimates and shipped one High NA EUV tool, but did not confirm FY growth, citing tariffs concerns and chip export restrictions, causing their stock to tumble 8% (CNBC)

• United Airlines beat Q2 earnings estimates but missed on revenue on worse-than-expected travel demand, particularly from price-sensitive customers for domestic flights; the firm reinstated its FY guidance after seeing the world as 'less uncertain' (CNBC)

• Progressive beat Q2 earnings estimates on strong personal insurance underwriting and premiums growth; its combined ratio improved to 86% to help net income more than double (RT)

• Johnson & Johnson issued a Q2 beat-and-raise signaling confidence despite looming pharma tariff threats and drug pricing crackdowns (BBG)

• What we're watching this week:  

  • Today: TSMC, Netflix, PepsiCo

  • Friday: Truist, American Express, Charles Schwab, 3M

• Full calendar here

Prediction Markets

• Everything is always priced in.

• Trade your predictions on a range of events, only on Kalshi. Sign up with code LIT and get a $20 bonus when you trade $100.

Headline Roundup

• JPMorgan is now worth more than its three largest rivals combined (BBG)

• Trump denied plan to fire J Pow after secretly discussing idea (CNBC)

• Trump would love for J Pow to resign (RT)

• Kevin Hassett and Kevin Warsh are top contenders to succeed J Pow (BBG)

• US eyes tariff rate of 10%-15% for over 150 countries (BBG)

• Trump softens tone on China to secure trade deal (BBG)

• US PPI inflation was unchanged at 2.3% YoY (CNBC)

• Fed Beige Book showed broad price increases as a result of tariffs (BBG)

• Beige Book reveals rising economic activity but pessimistic outlook (RT) 

• US industrial production rose for the first time in four months (BBG)

• Japan exports fell for second-straight month as tariffs stoke fears (CNBC)

• Investors have become more measured to Trump policy whiplash (RT)

• Wall Street CEOs see some tariff impact filtering into customer behavior (RT)

• Japan firms take global credit by storm with record sales (BBG)

• Asian bonds saw their first monthly foreign outflow in five months (RT)

• Emerging Asian bonds gain appeal as US tariffs cool inflation (BBG)

• Central banks ramped up buying at eurozone bond sales (BBG)

• Morgan Stanley is evaluating M&A but sets a high bar for deals (RT)

• Goldman plans to put private markets in 401(k)s (BBG)

• Activist Elliott is now battling a PE firm over fees (BBG)

• CalPERS backed California bill limiting PE control in healthcare (P&I)

• Citigroup is stepping up poaching of JPMorgan dealmakers  (RT)

• Huawei topped China smartphone market for first time in four years (BBG)

• HPE signed a pact with activist Elliott to boost its value (BBG)

• Scale AI will layoff 14% of staff after Meta's $14B deal (BBG)

• NBA is seeking its first expansion in over 20 years (BBG)

• Trump said Coca-Cola agreed to use real cane sugar in US (RT)

• Trump said calls to release Epstein files is 'a big hoax' (BBG)

A Message from Mizuho

ChatGPT

The number of users of OpenAI's premier product, ChatGPT, has grown to 500 million weekly active users in just over 2 years. The model became mature enough over that period to be released for use as general purpose AI, shared Sam Altman at the Mizuho Technology Conference. An earlier model may not have led to widespread adoption, he said, adding "our goal is to just get to a continuously improving system."

Energy

Cheap and abundant energy is what has propelled quality of life forward, Sam Altman told Michal Katz and Andy Laszlo during the keynote. Solar and nuclear power will figure prominently in the energy mix going forward and it’s important for the development of AI. "We will head towards a world where the cost of intelligence converges to the cost of energy," Altman said.

Deal Flow

M&A / Investments

• Circle-K-owner Couche-Tard withdrew its $47B bid to acquire 7-Eleven-owner Seven & i

• France-owned energy giant EDF is weighing options to sell some or all of its French district heating and cooling business Dalkia, potentially fetching $3.5B-$4.7B

• REIT Starwood Property Trust will acquire Fundamental Income Properties, including its operating platform and real estate portfolio, from Brookfield for $2.2B

• UK-based consumer products firm Coats Group agreed to acquire US footwear insole maker OrthoLite for $770M, including debt

• KKR is considering acquiring $440M-listed Italian healthcare technology firm GPI

• Uzbekistan is seeking sell the nation's fourth-largest mobile operator Mobiuz for $300M

• KPS Capital Partners and Warburg Pincus are no longer in talks to acquire German pharma packaging firm Gerresheimer

• British Airways-parent IAG will invest in Portugal's TAP Air Portugal and expand Lisbon's hub if selected in the Portugal's 44.9% stake sale

• Apollo is in talks to invest in Spanish soccer club Atletico Madrid

VC

• Embedded IoT cybersecurity startup Exein raised an $81M Series C led by Balderton

• Eton Solutions, a software and services company for family offices, raised a $58M Series C led by Navis Capital Partners

• Firestorm Labs, an expeditionary manufacturing company, raised a $47M Series A led by NEA

• Unify, an AI-native go-to-market platform, raised a $40M Series B led by Battery Ventures

• Crash Override, an Engineering Relationship Management platform, raised a $28M seed round led by GV and SYN Ventures

• HOPE Hydration, a startup building a network of free water stations, raised a $20M Series A led by Pentair

• Heka, a web intelligence provider for financial services, raised a $14M Series A led by Windare Ventures

• H2Ok Innovations, a startup providing AI-powered sensors for CPG manufacturing, raised a $12.4M Series A led by Greycroft

• Quandri, an AI platform modernizing servicing work for insurance brokerages and agencies, raised a $12M round led by Framework Venture Partners

• Function, a startup allowing Bitcoin to be used as a productive composable financial asset, raised a $10M seed round led by Galaxy Digital, Antalpha, and Mantle

• CREAL, a Swiss startup building light field display technology, raised an $8.9M round led by ZEISS

• Chariot Defense, a power platform for militaries in battlefield, raised an $8M seed round led by General Catalyst and XYZ

• ALVA Energie, a German startup decentralizing energy solutions, raised a $5.8M round from Triodos Bank, Brandenburg Kapital, and others

• Coverflow, an AI insurance platform, raised a $4.8M seed round led by AIX Ventures

• Quant Insight, a macro factor analytics company, raised a Series A led by 7RIDGE

IPOs / Direct Listings / Issuances / Block Trades

• State Bank of India is seeking to raise up to $2.9B in India's largest institutional share sale

• SoftBank-backed Asian travel platform Klook is considering raising $500M in a US IPO

• Nigerian bank Sterling Financial plans to raise $400M in phased capital across multiple instruments and currencies to support expansion efforts

• Transit tech firm Via Transportation is working with Goldman Sachs to revive a US IPO after first filing in 2021; the company was last valued at $3.5B in 2023

• India's biggest lender HDFC Bank is considering its fist ever bonus shares issue

Debt 

• Häagen-Dazs ice cream maker Froneriis is close to pricing a $4.5B junk debt deal to fund a $5.1B payout to shareholders Nestlé and PAI Partners

• JPMorgan sold $4B of bonds at a 113 bps premium 

• Japanese chipmaker Kioxia raised $2.2B in its debut US junk bond offering

• Apollo bought over $1.5B of APAC investment-grade loans from SMBC

• Commodities giant Trafigura raised $500M in its first bond sale in years

• Malaysian SWF Khazanah is considering a $500M exchangeable dollar bond sale to finance overseas investments

• Third-party litigation financier Burford Capital raised $500M in debt to broaden its litigation finance portfolio

• India's Embassy Office Parks REIT is in talks to raise $233M in a corporate bond sale

Bankruptcy / Restructuring / Distressed

• A bankruptcy judge gave Steward Health Care System the go-ahead to wind down, marking the closure of one of the biggest hospital bankruptcies in decades

Fundraising / Secondaries

• Investment manager Neuberger Berman raised over $2.8B for a new PE co-investment fund

• Private markets investment firm Pantheon raised $2.2B for its third credit opportunities fund

• Real estate investor AEW Capital Management raised $1.8B for its tenth flagship fund

• French PE firm Eurazeo raised $752M for a targeted $1.1B growth fund to capitalize on an AI-driven rebound in European tech funding

Crypto Sum Snapshot

• Founders Fund revealed a 9% stake in Ether treasury company BitMine

• Bank of America plans to launch its own stablecoin

• Crypto regulation stumbled in Congress for a second day

Check out our Crypto Sum newsletter for the full stories on everything crypto!

Exec’s Picks

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• Joe Wiggins wrote a great piece on market noise and how investors can about dealing with it.

Finance & Startup Recruiting 💼

Litney Partners

If you're a junior banker looking for your next career move, check out our recruiting firm, Litney Partners. Established by Litquidity and Whitney Partners (the oldest purely financial services executive search and consulting firm), Litney Partners has placed strong candidates across leading firms spanning private equity, hedge funds, venture capital, growth equity, private credit, investment banking, and fintech. Head over to our website to drop your resume / create your profile and we'd love to get in touch!

We are able to move faster than most firms due to our paralleled reach, decades of industry expertise, and ability to attract top caliber candidates.

Next Play

If you're down bad realizing finance isn't for you, and you're curious to explore the world of startups (BizOps, chief of staff, strategic finance, etc.), fill out this form. Next Play reviews every submission and will reach out to schedule a 1:1 video call if they think they can help as your own, personal startup matchmaker. They've grown their community to over 50k talented individuals and have strong relationships across the tech ecosystem.

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