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📈 AMD's Hidden Comeback
Trump-China "total reset" talks, Walgreens bets on pharmacy robots, OpenAI eyes Microsoft-backed IPO, Delta buys WestJet stake: $714M, Trump targets drug price cuts
Evelio Silvera
May 12, 2025
Good morning.
⚡ The Fast Five → Trump-China "total reset" talks, Walgreens bets on pharmacy robots, OpenAI eyes Microsoft-backed IPO, Delta buys WestJet stake: $714M, Trump targets drug price cuts
🔎 Market Trends → Wall St closed the week on Friday near flat with focus on US-UK Trade Deal & US-China talks; Stock futures jump as U.S. and China conclude two days of ‘productive’ trade talks
And now…
⏱️ Your 5-minute briefing for Monday, May 12, 2025:
MARKET BRIEF
Before the Open
As of market close 05/09/2025.
Pre-Market
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Fear & Greed
Markets in Review
Trade Winds Shift: Markets Brace for U.S.-China Talks, Lift Select Stocks
The Dow slipped 0.3% to 41,249.4, while the S&P 500 edged down 0.1% and the Nasdaq held flat. Health care lagged; energy led. All three major indexes posted modest weekly losses.
The Big Picture:
Wall Street ended the week on a cautious note as investors braced for U.S.-China trade talks scheduled for the weekend in Switzerland. President Trump hinted at a possible tariff cut to 80% from 145% on Chinese goods—a tone shift that signaled progress, or at least preparation.
Trump also touted a newly sealed trade deal with the UK and teased “many trade deals in the hopper.” Meanwhile, the Fed’s inflation dilemma continues to cast a long shadow, with Governor Michael Barr warning that tariffs could fuel both higher prices and job losses.
Markets are searching for clarity, but recent shipping activity and diplomatic momentum suggest de-escalation is more likely than stalemate.
Market Movers:
Insulet (PODD) soared 21%, the top S&P 500 gainer, after raising full-year revenue guidance following a quarterly beat.
Lyft (LYFT) rocketed 28% on a surprise Q1 profit and strong bookings, signaling a robust consumer pulse.
Pinterest (PINS) gained 4.9% as earnings came in “much better-than-feared,” defying macro pressure.
West Texas crude rose 1.7% to $60.95, as tariff détente hopes fueled oil demand optimism.
What They’re Saying:
“The FOMC may be in a difficult position if we were to see both rising inflation and rising unemployment.” — Fed Governor Michael Barr
WHAT WE’RE WATCHING
Events
There are no events scheduled for today.
Earnings Reports
Today: Fox Corporation, Simon Property Group, Petrobras, DaVita, Brink’s Company, Monday.com
Tomorrow: Sony, Under Armour, Sea Limited, MINISO Group
MARKET BRIEF
Leading News
AMD's Hidden Comeback: The Chip Giant's Valuation Paradox
Photo Credit: Timothy Dykes
Why it matters:
While most investors fixate on Nvidia's AI dominance, AMD (AMD) has quietly engineered an acceleration in revenue growth that the market hasn't fully recognized yet—creating what may be a rare opportunity in today's frothy tech sector.
Zoom Out:
The semiconductor world often operates in cycles of feast or famine, with investors periodically forgetting this fundamental truth. AMD shares trade 55% below their 2024 high, reflecting Wall Street's notorious pendulum swing from irrational exuberance to excessive pessimism.
The company's Q1 results reveal a business where the narrative has shifted faster than investor perception. Revenue growth accelerated to 36% year-over-year—up from 24% in the previous quarter—driven by data center chips and a resurgent PC market.
Key Insights:
The valuation disconnect is striking: AMD trades at just 26 times forward earnings despite accelerating growth. This represents the kind of asymmetric opportunity value investors patiently wait for in high-growth sectors.
The AI chip market isn't a winner-take-all game. AMD's data center segment grew 57%, proving there's room for multiple winners in this expanding market. History teaches us that technology monopolies rarely last forever.
Segment recovery in previously struggling divisions suggests the worst may be behind the company. Gaming and embedded divisions are showing sequential improvement—often the first signal of a broader turnaround.
Market Pulse:
"When others are fearful about a stock down 55% while its fundamental growth story improves, that's precisely when disciplined investors should be paying attention," notes veteran chip analyst Chris Bryant.
Bull’s Take:
Patient investors who can see through short-term noise might find AMD's current valuation a rare gift. The market's myopia regarding AMD's accelerating growth creates an attractive entry point for long-term investors willing to endure potential volatility.
Headlines
Trump hails China talks, says two sides negotiated 'total reset' in Geneva (link)
Walgreens doubles down on prescription-filling robots to cut costs, free up pharmacists amid turnaround (link)
OpenAI negotiates with Microsoft for new funding and future IPO (link)
Delta, Korean Air buy 25% of WestJet in $714 million deal (link)
Trump Says He Will Sign Executive Order Aimed at Lowering Drug Prices (link)
Zepbound beats Wegovy for weight loss in first head-to-head trial of blockbuster drugs (link)
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*Hat-tip to wallstmemes
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