📈 Workday's AI Bet

Good Morning…

While Wall Street obsesses over Workday's government sector hiccups, the real story lurks in plain sight: a profitable enterprise software giant just went shopping for AI talent at what could be a generational discount.

🔎 Market Trends → Wall Street closes down as investors brace for Powell's speech

🖥️ Market Movers from Fintech.tv → [WATCH] Kevin O’Leary on Bitcoin, Ethereum, and the Rise of Collectibles

And now…

⏱️ Your 5-minute briefing for Friday, August 22, 2025:

MARKET BRIEF
Before the Open 

Pre-Market

Fear & Greed

Markets in Review

Five Red Days, But the Bull Still Breathes

The S&P 500 lost 0.4% to 6,370.17, the Nasdaq fell 0.34% to 21,100.31, and the Dow slipped 152 points to 44,785.50 — its second decline this week.

The Big Picture:

Markets have been grinding lower for five straight sessions, but context matters: August is thinly traded, and volatility can look scarier than it is. What’s happening is less collapse, more recalibration.

Investors are bracing for Fed Chair Jerome Powell’s Jackson Hole speech on Friday. With Fed funds futures showing a 74% chance of a September rate cut, expectations are sky-high. Any dovish tone could flip the switch from risk-off to risk-on almost instantly.

Commodities are holding steady. Oil remains above $75 a barrel, supported by tight supply and tariff-driven trade flows. That acts as a double-edged sword — sticky input costs for manufacturers, but margin opportunity for energy producers (XLE).

Market Movers:

• Retail reality check: Walmart (WMT) fell 4% on an earnings miss — its first since 2022 — despite stronger sales. Target (TGT) also slid earlier in the week, spotlighting consumer strain.

• Tech fatigue: Profit-taking hit Nvidia (NVDA), Palantir (PLTR), and Meta (META). These names are still up triple digits YTD, but rich valuations make them sensitive to Fed tone.

• Cruise control: Carnival (CCL) surged after Citi called it the best stock in its coverage, citing new destinations and potential share buybacks. Shares are already up 17% YTD.

What They’re Saying:

“Stock valuations are very elevated right now heading into Jackson Hole, and investors have very high expectations that Powell will hint at a September rate cut,” said Rick Gardner, CIO at RGA Investments.

WHAT WE’RE WATCHING
Events

• Today: Federal Reserve - Fed Chair Powell Speaks - 10:00am

  Why You Should Care: As head of the central bank, which controls short term interest rates, he has more influence over the nation's currency value than any other person. Traders scrutinize his public engagements as they are often used to drop subtle clues regarding future monetary policy;

Earnings Reports

• Today: BJ’s Wholesale Club, The Buckle, Bridgford Foods

• Monday: There are no noteworthy earnings reports.

MARKET INSIGHTS
Leading News 

Workday's AI Bet Shows Cloud Giants Still Have Room to Run

Why it matters:

While government headwinds create near-term noise, WDAY's earnings beat and strategic AI acquisitions signal the enterprise software revolution is far from over.

Zoom Out:

The quarterly numbers tell a familiar story of steady enterprise demand. Revenue climbed 13% to $2.35 billion, beating estimates by a whisker, while adjusted earnings of $2.21 per share topped Wall Street's $2.11 forecast.

But here's what really matters for long-term investors: Workday just bought Paradox, an AI recruiting platform, doubling down on the automation wave that's reshaping how companies manage their most expensive asset—people.

The stock's 12% year-to-date decline looks like classic value-trap behavior, especially when you consider the Nasdaq's 9% gain. Smart money often hides in these temporarily unloved names.

Key Insights:

• Government slowdown is temporary noise: State and local budget pressures rarely persist beyond election cycles. Historical data shows public sector IT spending rebounds strongly post-recession.

• AI integration accelerating: The Paradox acquisition signals Workday's shift from basic HR software to intelligent workforce orchestration—a market Goldman Sachs values at $150 billion by 2030.

• Subscription model intact: $8.82 billion in projected annual subscription revenue shows the recurring revenue machine keeps humming, even amid macro uncertainty.

Market Pulse:

“Higher education funding will stabilize once the political dust settles—these institutions can't operate without modern HR systems," notes CEO Carl Eschenbach.

Bull’s Take:

While near-term government headwinds create buying opportunities, Workday's AI pivot and fortress-like subscription model position it perfectly for the next enterprise upgrade cycle. Smart investors buy the dip in quality names trading at temporary discounts.

Market Stories of Note

Amazon's Grocery Gambit: Late to the Party, But Armed With Prime:

Amazon's belated push into same-day grocery delivery across 2,300 markets matters because it transforms the company's massive fulfillment network into a potential weapon against Walmart's surprising 32% online grocery dominance. The real insight here isn't Amazon's technological prowess—it's that behavioral economics suggests Prime members, already conditioned to expect everything fast and free, represent the stickiest customer base in retail history. While Instacart's 14% stock plunge last week smells like Wall Street overreaction, patient investors should remember that Amazon's track record of patient capital deployment in new markets has a curious habit of eventually reshaping entire industries.

Google's $10 Billion Meta Deal: Cloud Wars Enter the Nuclear Phase:

Google's capture of a $10+ billion cloud contract from Meta matters because it marks the first time a tech giant has chosen a direct competitor's infrastructure for mission-critical AI workloads, signaling that even Silicon Valley's fiercest rivals prioritize performance over pride when billions are at stake. The deeper insight reveals Meta's calculated bet that Google's cloud infrastructure can handle AI training demands better than building everything in-house—a rare admission of technological limits from Zuckerberg's empire. For investors, this validates Google Cloud's enterprise credibility while suggesting that Big Tech's combined $364 billion AI spending spree will create winners across multiple companies rather than a zero-sum game.

CRYPTO
Fear & Greed 

Headlines

• Bitcoin Slips Toward $112K as Powell Prepares to Take the Stage (link)

• Crypto Exchange Gemini Secures MiCA License in Malta, Expands European Footprint (link)

• Crypto security firm Kerberus acquires Pocket Universe, an anti-fraud browser extension for Ethereum and Solana wallets (link)