Hey Snackers,
A new study from Pew Research Center found that Americans don’t like it when they learn that something was produced by AI. However, the degree to which the use of AI bothers them can vary widely depending on the scenario: for example, AI in the arts was generally more accepted than politics, banking, and journalism, with only 38% of respondents reporting that they’d like music less after discovering it had been generated by AI. (See the full list of AI scenarios here.)
The S&P 500 and Nasdaq 100 set fresh record closing highs to kick off the week, up 0.4% and 0.5%, respectively, while the Russell 2000 outperformed with a 0.6% advance.
While indexes are making new highs, breadth is not. Over the past 15 trading days, the S&P 500 has moved higher despite more of its constituents falling than rising on seven occasions, including yesterday. That’s tied for the highest frequency of the US benchmark index and its components diverging over a three-week span on record.
Oklo is worth $20 billion. An analyst just upped their price target from $80 to $150. The company has produced no revenue yet.
Oklo is the 449th-largest stock in the US coming into this week, boasting a market cap above that of Dick’s Sporting Goods, Dollar Tree, or Halliburton.
It also happens to have generated zero sales, making it the largest pre-revenue stock listed on US exchanges, per an equity screen run on Bloomberg.
Oklo is in the nuclear power business, and has positioned itself as a potential power provider to help facilitate the AI boom.
It has a market cap of about $20 billion on no revenue, beating the next-largest zero-revenue stock (Summit Therapeutics, with a $14 billion market cap).
Wedbush Securities analyst Dan Ives boosted his price target on the stock to a whopping $150 from $80 on Sunday, citing “incremental confidence in the company’s nuclear growth strategy as the AI Revolution hits its next stride of growth.” It’s also on his Ives AI 30 list of stocks that, in his view, offer the most exposure to the AI boom.
Yesterday, Oklo announced that it held a groundbreaking ceremony for its Idaho-based “first Aurora powerhouse,” which was attended by EPA Administrator Lee Zeldin, Governors Bradley Little (Idaho) and Spencer Cox (Utah), US Senators Mike Crapo and James Risch, Congressman Mike Simpson, Nuclear Regulatory Commission chief Bradley Crowell, and the Department of Energy’s Michael Goff and Robert Boston, to name a few.
The Takeaway
“Given the recent focus on nuclear energy following the Trump Administration Executive Order we view this as ‘just the start’ of the nuclear focus for energy in the US over the coming year with OKLO leading the sector,” Ives added. “Our time spent in the Beltway last week with meetings on the Hill gave us incremental confidence that the push for nuclear energy in the US is now underway and positions OKLO very well for this wave of spending/growth/regulatory approval.”
Nvidia announced plans to invest up to $100 billion in OpenAI as part of its data center expansion
Shares jumped in Nvidia as the company said it would invest as much as $100 billion into OpenAI as part of an unprecedented data center buildout.
Nvidia CEO Jensen Huang and OpenAI CEO Sam Altman made the announcement on CNBC midday Monday. Nvidia would invest the money “progressively as each gigawatt is deployed,” per CNBC reporting.
The two companies will work together to build out an unprecedented 10 gigawatts of capacity over several years, an endeavor that Huang said on CNBC would be “the biggest AI infrastructure project in history” and “the largest computing project in history.”
For scale, 10 gigawatts of power is roughly equivalent to the average demand of 8 million US households — the population of New York City.
“This new project that we’re talking about [is] 10 gigawatts, or roughly 4 million, 5 million GPUs. That’s approximately, in one project, what we shipped all year this year, and twice as much as last year,” Huang said.
The Takeaway
Nvidia has seen its valuation surge on the heels of an AI boom that’s been fueled, in many ways, by the accomplishments of OpenAI. Nvidia’s been clever about reinvesting into the industry, its customers, and the companies that form the ancillary businesses around its own. It’s paid off handsomely; heck, the value of Nvidia’s investment into CoreWeave increased by about $3.1 billion over the course of the second quarter.
The Best Thing We Read Today
How JPMorgan Asset Management’s chief global strategist sees the markets now
Now that we’ve seen the first Federal Reserve rate cut for 2025, we were lucky enough to pick the brain of JPMorgan’s David Kelly on what he thinks “appropriate positioning” looks like in the current market and what makes “the environment just a little bit dangerous for investors.”
Yesterday's Big Daily Movers
Better Home & Finance soared after Opendoor kingmaker Eric Jackson dubbed it the “Shopify of mortgages”
Snap surged on positive r/WallStreetBets chatter as users hope for a potential acquisition
Quantum Computing dropped after announcing a $500 million at-the-market stock offering
Moderna rose after a CDC vaccine panel’s less-draconian-than-expected Covid shot recommendation
Chinese EV maker Nio sank after its new SUV turned out to be too popular, creating a six-month backlog
What Else We're Snackin'
Stocks that have gone up keep going up, as momentum rolls higher and value stocks get crushed
The US tech companies most affected by President Trump’s $100,000 H-1B fee, charted
If having multiple CEOs is better for stock market returns, Oracle is quadrupling down
Analyst Dan Ives raised Wedbush’s Apple price target to a Wall Street high, citing a “real upgrade cycle” for iPhones
Fox Corp.’s Lachlan and Rupert Murdoch might be part of the US TikTok deal
Meanwhile, the US is toying with making what might be the world’s worst investment
Snack Fact Of The Day
Of those surveyed, gambling dealers reported the highest percentage of tips included in their total wages.
Today's Events
August existing home sales
Earnings expected from Micron Technology and AutoZone