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📈 Meta's $15B Scale AI Bet
Nvidia: Quantum Hits Inflection Point, Starbucks Gets AI Barista Assistant, Google Expands AI-Driven Buyouts, McDonald's Drops on Weight-Loss Fears, GM Invests $4B Amid Tariffs
Evelio Silvera
June 11, 2025
Good morning.
⚡ The Fast Five → Nvidia: Quantum Hits Inflection Point, Starbucks Gets AI Barista Assistant, Google Expands AI-Driven Buyouts, McDonald's Drops on Weight-Loss Fears, GM Invests $4B Amid Tariffs
🔎 Market Trends → Wall Street ends higher as investors track US-China trade talks; US Futures Steady as Investors Eye US-China Trade Talks
And now…
⏱️ Your 5-minute briefing for Wednesday, June 11, 2025:
MARKET BRIEF
Before the Open
As of market close 06/10/2025.
Pre-Market
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Fear & Greed
Markets in Review
Markets March Ahead as Traders Bet on a US-China Trade Breakthrough
S&P 500 and Nasdaq rose 0.6%, notching their third straight gain. The Dow added 0.3%, buoyed by energy stocks and optimism around ongoing trade negotiations in London.
The Big Picture:
Wall Street continued its cautious ascent as US-China trade talks entered a second day, with signs of progress helping to offset lingering macro concerns. Commerce Secretary Howard Lutnick called the talks 'going well,' suggesting they may even extend into Wednesday — a sign both sides are serious.
Bond yields barely budged as investors braced for a midweek inflation print. The CPI report due Wednesday is expected to show core inflation ticking to 2.5% year-over-year. But despite tighter policy risks, small business sentiment rose for the first time in 2025 — a bullish signal beneath the noise.
The World Bank trimmed its growth forecast for 2025-26, but offered a silver lining: a de-escalation of trade tensions could boost global growth by 0.2 percentage points.
Market Movers:
Casey’s General Stores (CASY) soared 11.6%, after issuing a strong sales growth forecast for fiscal 2026. Its Q4 earnings beat expectations, bucking trends in retail.
J.M. Smucker (SJM) plunged 15.6% as its downbeat full-year guidance spooked investors already nervous about consumer staples' pricing power.
United Natural Foods (UNFI) dropped 10.2% after withholding updated guidance amid a cybersecurity review, even as it beat on earnings.
What They’re Saying:
“Although optimism recovered slightly in May, uncertainty is still high among small business owners.” — Bill Dunkelberg, NFIB Chief Economist
WHAT WE’RE WATCHING
Events
Today: Bureau of Labor Statistics - Consumer Price Index (CPI) m/m;
Core CPI Ex Food and Energy m/m; CPI y/y - 8:30am
Why You Should Care: Consumer prices account for a majority of overall inflation. Inflation is important to currency valuation because rising prices lead the central bank to raise interest rates out of respect for their inflation containment mandate
Earnings Reports
Today: Oracle, Chewy, Victoria’s Secret, Nathan’s Famous
Tomorrow: Adobe Inc., RH, Korn Ferry
MARKET BRIEF
Leading News
Meta's $15B Scale AI Bet: Smart Money or Desperate Gamble?
Photo Credit: Greg Bulla
Why it matters:
Meta (META) is placing its biggest AI wager yet, signaling either shrewd strategic positioning or anxiety about falling behind in the intelligence arms race.
Zoom Out:
The math here tells a story about market desperation disguised as market dominance. When a company with $200+ billion in annual revenue writes a $14.8 billion check for a 49% stake in an AI startup, you're witnessing either visionary leadership or expensive panic buying.
Scale AI's revenue trajectory—from $870 million in 2024 to an expected $2+ billion in 2025—suggests Meta isn't just buying technology; it's acquiring the picks and shovels of the AI gold rush. The company provides the labeled data that trains everything from ChatGPT to autonomous vehicles.
The behavioral finance lesson? When tech titans start hiring rival CEOs and restructuring entire divisions, smart money pays attention to both the opportunity and the underlying anxiety driving such moves.
Key Insights:
Talent Arbitrage Play: Bringing Scale AI's Alexandr Wang into Meta's new "superintelligence" lab represents classic Silicon Valley talent acquisition—sometimes the fastest way to build capability is to buy the team that already has it.
Regulatory Chess: The 49% stake structure cleverly sidesteps full acquisition scrutiny while Meta faces antitrust heat over Instagram and WhatsApp—a masterclass in regulatory arbitrage.
Data Moat Strategy: Scale AI's client roster reads like a who's who of AI leaders (OpenAI, Google, Microsoft), giving Meta unprecedented intelligence on competitor strategies.
Market Pulse:
"When Meta is buying them, they're buying their intelligence," notes Vahan Petrosyan, CEO of competitor SuperAnnotate. "Scale have covered probably 70% of all the models that are built."
Bull’s Take:
Meta's willingness to pay premium prices for AI infrastructure signals confidence in future returns that could dwarf today's investment. Sometimes the most expensive bet is the one you don't make.
Headlines
Nvidia CEO says quantum computing is reaching an ‘inflection point’ (link)
IBM Stock Gains As Tech Giant Offers Plan For Quantum Computing's 'Next Frontier' (link)
Starbucks to roll out Microsoft Azure OpenAI assistant for baristas (link)
Google Expands Buyouts In Search And Ads Division As AI Reshapes Priorities (link)
McDonald's shares slip after downgrade spurred by weight-loss drug popularity (link)
GM to invest $4 billion in U.S. plants amid tariffs for Mexican-produced vehicles (link)
CRYPTO
Fear & Greed
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On the Socials
*Hat-tip to AutismCapital
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