Super Short Micro

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Good Morning,

Florida accidentally banned banks from doing business, UK's new budget took aim at PE, FOMO is driving gold to historic highs, and EY severed ties with Supermicro on serious 'integrity' concerns.

The once high-flying AI darling has been getting absolutely cooked with a whistleblower lawsuit, a scathing short report, delayed earnings, a federal investigation, and its auditor resigning, all within the last six months. This isn't even their first such controversy, having been delisted in 2018!

Move on from the daily deluge of tedious tasks and streamline all your investment processes with BlueFlame AI, a GenAI platform for alternative investments.

Let's dive in.

Before The Bell

As of 10/30/2024 market close.

Markets

  • US stocks fell yesterday as investors digested Big Tech earnings and economic data

  • UK 10Y gilt yield spiked to 4.36% in response to the UK budget 

  • Gold soared to new ATHs

  • Implied dollar volatility surged to its highest since March 2023 in its biggest one-day rise since 2017 ahead of US elections

Earnings

  • Microsoft beat Q1 EPS and revenue estimates as AI demand fueled growth in its cloud business, though Q2 guidance fell short of expectations (CNBC

  • Meta beat Q3 EPS estimates and posted record revenue but missed on user growth and warned of significant acceleration in AI CapEx (CNBC

  • Starbucks missed Q3 EPS and revenue estimates on a third-straight quarterly sales decline, prompting new CEO Niccol to announce fundamental changes in menu, prices and offerings (CNBC)

  • Coinbase missed Q3 EPS and revenue estimates as low Bitcoin volatility led to muted crypto trading (CNBC

  • Eli Lilly missed Q3 EPS estimates and slashed FY guidance amid disappointing sales in its blockbuster weight loss and diabetes drugs (CNBC)

  • DoorDash beat Q3 estimates on its first-ever profit and gave a strong Q4 forecast as it seeks to capture resilient demand for online delivery (RT)

  • What we're watching this week: 

    • Today: Apple, Amazon, Intel, Uber

    • Friday: ExxonMobil, Chevron

  • Full calendar here

🇺🇸 Election Forecast

As of 10/30/2024.

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Headline Roundup

  • US hiring surged by the most since July 2023 (CNBC)

  • US GDP grew 2.8% YoY on resilient consumer spending (BBG)

  • Eurozone GDP grew 1.5% YoY in a two-year high (CNBC)

  • Treasury will maintain auction sizes for next several quarters (RT)

  • UK budget reveals £40B tax hikes aimed at PE and wealthy (FT)

  • Australia inflation fell to 2.8% to its lowest since early 2021 (RT)

  • Florida accidentally banned banks from doing business (WSJ)

  • Equal-weight European index funds are seeing record inflows (FT)

  • Value and volume of gold demand hit record highs (BBG)

  • AI's $1.3T future increasingly hinges on Taiwan (BBG)

  • EY resigned as Supermicro's auditor on 'integrity' concerns (CNBC)

  • Samsung's smartphone crown slips as tech giant faces reckoning (BBG)

  • Volkswagen profit plunged 64% on China woes (FT)

  • KKR and ECP will invest $50B in AI data center and power projects (WSJ)

  • Dropbox laid off 20% of its workforce (WSJ)

  • Spirit will furlough 330 more pilots (RT)

  • US cracked down on Russia's facilitators worldwide (FT)

  • Scott Murray was sentence to prison over a fake $4B Getty Images bid (RT)

  • US 30Y mortgage rate surged to 6.73%, the highest since July (RT)

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Deal Flow

M&A / Investments

  • German engineering group Siemens agreed to buy software maker Altair Engineering for $10B, including debt

  • The family of Susan Y. Kim, which controls Amkor Technology, is in talks to acquire a minority stake in the NFL's Philadelphia Eagles from Jeff Lurie at an $8B valuation

  • $2.7B-listed Japanese lift-maker Fujitec is in talks sell to PE

  • Brookfield acquired a $2.3B stake in four offshore wind farms from Danish energy giant Orsted

  • Insurers Allianz, Aviva, Sampo, and Ageas are among potential bidders for Bain Capital-owned UK insurer Esure, which could fetch $1.9B 

  • Norway-owned energy giant Equinor will acquire a 60% stake in non-operated natural gas assets in PA from EQT for $1.3B

  • Francisco Partners will acquire Global Payments' medical software business AdvancedMD for $1.13B

  • ConocoPhillips is exploring a sale of some of its Permian Basin shale operations for over $1B

  • Investment firm Aquarian acquired a majority stake in PACE Equity and will invest $1B in the sustainable CRE lender

VC

  • Chinese data center firm GDS raised $1B Series B led by Coatue and Baupost

  • Tencent-backed fintech Airwallex is in talks to raise $200M at a $6B valuation

  • Customer service Ai startup Regal raised a $40M round from Emergence Capital, Founder Collective, and Homebrew

  • Zenity, a startup securing agentic AI, raised a $38M Series B led by Third Point Ventures and DTCP

  • Neara, an AI-powered predictive modeling software for critical infrastructure, raised a $31M Series C led by EQT 

  • Specialized bond ETF provider BondBloxx raised a $27M round led by Macquarie

  • Procurify, a proactive spend management solutions, received $20M in growth capital from CIBC Innovation Banking

  • Remote sensing startup Matter Intelligence raised a $12M seed round led by Lowercarbon Capital

  • Databento, a financial data startup, raised $10M from Belvedere Trading, Clear Street, Lightscape Partners, and others

  • Bifrost, a startup helping industrial companies speed up model training, raised an $8M Series A led by Carbide Ventures 

  • Verax AI, an enterprise-grade software solutions for visibility and control of AI in production, raised a $7.6M seed round led by TQ Ventures 

  • Autonomous GenAI-for-code startup Diffblue raised a $6.3M round led by IP Group, Parkwalk Advisors, and AlbionVC 

  • Hummingbirds, a platform connecting hyperlocal creators with brands, raised a $5.4M round led by Allos Ventures, Ground Game, and others

  • CREW Carbon, a decarbonization platform for wastewater, raised a $5.3M seed round led by Counteract 

IPO / Direct Listings / Issuances / Block Trades

  • Korea Zinc plans to raise $1.8B in a discounted stock offering equivalent to 18% of outstanding shares

  • A group of investors led by Emirates Driving will invest over $1B in Vietnamese EV maker VinFast 

Debt

  • Danish logistics giant DSV launched a $5.4B bond sale to fund its $15.5B acquisition of Deutsche Bahn's DB Schenker unit 

Bankruptcy / Restructuring / Distressed

  • BlackRock-owned insurance claims manager Alacrity Solutions is in restructuring talks with private credit lenders Antares, Blue Owl, and KKR

Fundraising

  • MM PE firm Berkshire Partners closed its eleventh flagship fund at $7.8B

  • PIMCO raised $2B for its specialty asset-based private lending strategy

  • European growth equity firm Verdane raised $755M for a second decarbonization fund

  • PE firm Inverness Graham closed its inaugural high-growth LMM fund with $238M

Crypto Corner

  • MicroStrategy plans to raise $42B to buy more Bitcoin (CD)

  • MrBeast is being investigated for insider trading and crypto scams (CN)

  • FTX's Nishad Singh received no prison time after cooperating (CNBC)

Exec’s Picks

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