Hey Snackers,
If we said the phrase “after dark,” you’d probably think of late-night bars and risquĂ© shows, but what if we told you there was a new “AfterDark” fund coming that goes risk-on every night and returns to safe havens each morning? Well, it’s true: the Nicholas Bitcoin and Treasuries AfterDark ETF will trade bitcoin and its derivatives from US market close to open, when it will close all its positions and convert them to US Treasurys. It seems silly at first, but it turns out there’s a pretty solid financial thesis for the structure.Â
Stocks wavered ahead of the Federal Reserve’s interest rate decision today. While the market is anticipating a quarter-point rate cut, Fed Chair Jerome Powell’s commentary will offer crucial insight into the central bank’s approach to easing in 2026.
Apple’s stock is behaving differently from the rest of BATMMAAN because its AI strategy is nowhere
Hey Siri: why is Apple’s stock behaving differently from the rest of Big Tech?Â
Siri, of course, will have absolutely no clue — because Apple’s AI strategy is borderline nonexistent.
Google’s AI efforts have gone from strength to strength. ChatGPT has grown its weekly active users to nearly 900 million. Nvidia briefly crossed a $5 trillion market cap. Apple, uh, released some underwhelming updates to its flagship Apple Intelligence product?
That said, its lack of AI progress is increasingly affecting how the stock is trading, as Apple becomes a sort of “anti-AI” vehicle for investors.Â
Indeed, its correlation with the rest of the BATMMAAN group has dropped precipitously: when ChatGPT was released at the end of November 2022, Apple’s average pairwise correlation (based on daily returns over 90-day rolling periods) to its Big Tech peers was 0.71 — recently it has dropped to as low as 0.2.
This is a pretty steep drop-off, and it’s been most pronounced in the stocks that are closest to the AI trade (notably Nvidia, Microsoft, and Broadcom). Apple and Microsoft used to trade nearly in tandem, with a correlation coefficient between the two north of 0.8. That has all but collapsed, with the last 90 trading sessions barely showing a positive correlation.
The Takeaway
Perhaps what’s most remarkable from mining the correlation stats is that Apple’s average correlation with the rest of its peer group is now the lowest of any BATMMAAN stock. People used to say that Tesla was the odd one out of the Big Tech giants — but the trading data suggests, fairly strongly, it’s Apple right now.Â
Last week, Apple retired its AI chief, potentially suggesting a renewed focus on the nascent technology under new leadership.
Accenture is the new “AI training your replacements” play in the market
Accenture rose after the consulting giant announced a multiyear partnership with Anthropic to become “a premier AI partner for coding with Claude Code.” This includes a joint offering for AI-enabled software development with a focus on regulated industries including finance, healthcare, life sciences, and the public sector.
It’s worth considering that consulting is perhaps one of the most interesting niches of the economy when it comes to AI’s impact on jobs.Â
As Sherwood News’ Hyunsoo Rim recently flagged, the consulting business has hit an AI-shaped wall, with employment in the industry peaking shortly after the launch of ChatGPT.
It comes on the heels of Accenture’s partnership with OpenAI earlier this month to utilize ChatGPT Enterprise in its consulting work.Â
It’s also recently invested in AI-powered customer research platform WEVO and expanded its collaboration with cloud-based data company Snowflake to better utilize data using AI tools.
Charitably, Accenture’s management is eagerly embracing how the consulting business may be radically altered in a world where corporate AI adoption is ubiquitous, and reacting accordingly. Uncharitably, it’s the best “training your replacements” company out there.
The Takeaway
One must consider that the ultimate service provided by a lot of consultants is to affirm, supplement, or execute management decisions made by their clients. This is a necessary service — shareholders enjoy enlisting third parties to affirm the decisions of management — but ultimately we’re confronting the possibility that instead of hiring, say, a kid fresh out of an MBA program to do that, you can probably just use an upgraded Clippy.
Can Accenture make enough deals to stave off this fate? Can LLMs actually supplant consultants? Who wins and who loses is going to be one of the more interesting early answers to the key employment questions of the AI transition.
The Best Thing We Read Today
Where Morgan Stanley thinks autonomous taxis will be in 2032
Recently Sherwood laid out the current autonomous ride-share landscape, which is mostly a battle between Google’s Waymo and Tesla. According to a new report from Morgan Stanley’s research team that looks forward to the next half decade, robotaxis’ future — while expected to grow rapidly — might not be so different.
Snacks Shots
đź“Š Fed: It’s the big day! Markets* are pricing in a 96% chance of a 25-basis point rate cut from the Fed meeting later today. That call won’t be uncontroversial: markets are pretty sure this decision won’t be made without incurring at least one dissent from the Fed’s members.Â
đź“ş Netflix: The blockbuster deal of Netflix acquiring Warner Bros. Discovery has ticked off rival bidders, specifically Paramount’s David Ellision, who announced plans to carry out a hostile takeover, not to mention some of Netflix’s own shareholders. It’s still early days, but there’s skepticism that the Netflix deal will go through, at least quickly: traders at Polymarket are giving the deal just a 26% chance of closing next year.Â
⚽️ World Cup: With the groups drawn, Spain remains the favorite to win the 2026 Men’s World Cup, followed by France (implied 13% chance), England (13% chance), Brazil (10% chance), and Argentina (10% chance).Â
*Event contracts are offered through Robinhood Derivatives, LLC — probabilities referenced or sourced from KalshiEx LLC or ForecastEx LLC.
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Snack Fact Of The Day
ChatGPT has nearly 900 million active weekly users.
Today's Earnings
FOMC interest rate decision and Fed chair press conference
Earnings expected from Chewy, Vail Resorts, Oracle, Planet Labs, and Adobe