📈 Google’s Quantum Leap

Good morning.

⚡ The Fast Five → Walgreens shares soar 20%, Tesla stock hits 3 year high, GameStop makes a profit, United Natural Foods stock up 23%, Alphabet shares jump 6%

🔎 Market Trends → Wall St indexes fall with inflation data and rates in focus; US Futures Hold Steady Ahead of CPI Report

And now…

⏱️ Your 5-minute briefing for Wednesday, December 11, 2024:

MARKET BRIEF
Before the Open

Pre-Market

Fear & Greed

Markets in Review

Markets Slip but Optimism Lingers Ahead of Inflation Data

The S&P 500 and Nasdaq both fell 0.3%, closing at 6,034.9 and 19,687.2, while the Dow declined 0.4% to 44,247.8. Real estate led losses, but communication services stood out as a gainer.

The Big Picture:

Investors paused ahead of Wednesday’s consumer inflation report, which is expected to show a 0.3% month-over-month increase in CPI and 2.7% year-over-year growth. These numbers will set the tone for the Fed's next steps on monetary policy.

Commodities: Oil prices held steady at $68.38/barrel, while gold climbed 1.3% to $2,719.80/oz, reflecting caution among investors. Silver added 0.1%, closing at $32.63/oz.

Adding to the bullish undercurrent, small business optimism surged to its highest level since mid-2021, signaling growing confidence on Main Street despite macroeconomic uncertainty.

Market Movers:

• MongoDB (MDB): Plunged -16.9%, despite raising its full-year outlook. Investors zeroed in on a forecasted slowdown in its Atlas cloud platform, overshadowing strong Q3 results.

• Walgreens (WBA): Soared +17.7% on reports of acquisition talks with private equity firm Sycamore Partners, driving hopes for a turnaround.

• Boeing (BA): Climbed +4.5%, as resumption of 737 production at its Washington plant reassured markets, despite lower November deliveries.

• Oracle (ORCL): Slipped -6.7% after a mixed Q2 earnings report highlighted cloud strength but exposed hardware and services weaknesses.

What They’re Saying:

"Main Street's optimism bodes well for future growth as small businesses anchor the U.S. economy," said NFIB Chief Economist Bill Dunkelberg.

WHAT WE’RE WATCHING
Events

• Today: Bur. of Labor Statistics - Consumer Price Index (CPI); Excluding Food and Energy - 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: Adobe, Barnes & Noble Education

• Tomorrow: Broadcom, Costco Wholesale

MARKET BRIEF
Leading News

Willow Unleashed: Google’s Quantum Leap Sends Alphabet Soaring

Why it matters:

Google’s unveiling of its breakthrough quantum computing chip, Willow, sent Alphabet (GOOGL) shares up 6% on Tuesday, highlighting investor enthusiasm for the future of computation. Quantum technology could unlock game-changing applications in drug discovery, clean energy, and AI—but it’s still in its early innings.

Zoom Out:

Alphabet has placed a bold bet on quantum computing, revealing the Willow chip, which can perform calculations millions of times faster than today’s supercomputers. While traditional semiconductors rely on binary transistors, Willow’s qubits enable unprecedented parallel computation—tackling problems previously deemed unsolvable.

Quantum chips like Willow have faced a major hurdle: error correction. Google claims Willow significantly reduces errors, a critical step toward scaling up to 1 million qubits, a target that could redefine computing power.

Notably, tech heavyweights such as Nvidia (NVDA), Microsoft (MSFT), and IBM (IBM) are also racing to dominate quantum computing, fueling a competitive landscape in this frontier tech.

Deep Dive:

• Milestone Achieved: Willow is the second step in Google’s six-part quantum roadmap, ultimately aiming for a large, error-corrected quantum computer.

• Future Applications: Google envisions breakthroughs in battery design, fusion energy, and drug discovery, disrupting industries from healthcare to energy.

• Investor Sentiment: Backed by endorsements from Elon Musk and Sam Altman, Alphabet’s quantum ambitions are energizing its stock, up 30% YTD and hitting $186.53.

Market Pulse:

"Willow brings us closer to running practical, commercially relevant algorithms that can’t be replicated on conventional computers," Google CEO Sundar Pichai said.

Bull’s Take:

Quantum computing could be the next trillion-dollar tech frontier, and Alphabet is positioned to lead the charge. While practical applications are still years away, early movers like Google offer investors a compelling long-term growth story. With Alphabet shares already outperforming in 2024, Willow’s quantum promise signals a bullish opportunity for patient investors to ride the wave of innovation.

Headlines

• Tesla Stock Hits Three-Year High as Morgan Stanley Lifts Price Target (link)

• Walgreens shares soar 20% on reported talks to sell itself to Sycamore Partners (link)

• Boeing Stock Is Taking Off. Here’s Why. (link)

• United Natural Foods’ stock soars 23% as health-food supplier delivers a surprise adjusted profit (link)

• GameStop Swings to a Profit Despite Revenue Dip (link)

• Adidas headquarters raided in years-long tax investigation, company says (link)

CRYPTO
Fear & Greed

Headlines

• XRP Rallies 10% as Ripple's Stablecoin Gets Regulatory Approval, CEO Garlinghouse Says (link)

• Microsoft shareholders vote against Bitcoin investment (link)

• Magic Eden's $5B Token Airdrop Raises Crypto Wallet Security Questions (link)

DAILY SHARE
On the Socials