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- 📈 Palantir Looks to Disrupt Defense Giants
📈 Palantir Looks to Disrupt Defense Giants
US finalizes $6.75B for chips to Samsung & Texas Instruments, FDA approves Lilly obesity med for sleep apnea, Carnival ends 2024 with record revenue, Stellantis reverses layoffs, Palantir & Anduril’s Pentagon power play
Evelio Silvera
December 23, 2024
Good morning.
⚡ The Fast Five → US finalizes $6.75B for chips to Samsung & Texas Instruments, FDA approves Lilly obesity med for sleep apnea, Carnival ends 2024 with record revenue, Stellantis reverses layoffs, Palantir & Anduril’s Pentagon power play
🔎 Market Trends → Wall St Week Ahead Investors hope for 'Santa Claus' rally as stocks lose steam; US Futures Pare Some Losses After PCE
And now…
⏱️ Your 5-minute briefing for Monday, December 23, 2024:
MARKET BRIEF
Before the Open
As of market close 12/20/2024.
Pre-Market
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Fear & Greed
Markets in Review
Markets Climb as Inflation Eases and Spending Strengthens
The Dow rose 1.2% to 42,840.3, the S&P 500 gained 1.1% to 5,930.9, and the Nasdaq increased 1% to 19,572.6. All sectors posted gains, led by real estate.
The Big Picture:
Investors cheered a favorable inflation report and strong consumer spending data on Friday. The Fed’s preferred inflation gauge held steady at 2.8% annually, while month-over-month growth eased to 0.1%, below expectations. Consumer spending also accelerated, showing resilience heading into the new year.
The Fed’s recent rate cut and cautious stance on further easing indicate confidence in the economy’s momentum, even as inflation slows. Meanwhile, consumer sentiment climbed to its highest level since April, a bullish signal for spending-driven growth.
Oil rose slightly to $69.50/barrel, reflecting steady demand. Gold gained 1.2% to $2,639.70/oz, and silver climbed 2.3% to $30.08/oz, as investors sought hedges amid mixed signals.
Market Movers:
Carnival (CCL): Jumped +6.4% after beating Q4 earnings expectations, signaling a rebound in travel demand and stronger-than-anticipated cost control.
Humana (HUM): Rose +4.8% as investors welcomed a leadership transition with the appointment of a new CIO, boosting confidence in its innovation strategy.
Tesla (TSLA): Fell -3.5%, the worst performer on the Nasdaq and S&P 500, following a recall of over 694,000 vehicles due to a tire pressure monitoring issue.
Novo Nordisk (NOVO_B): Tumbled -18% after its weight-loss drug missed key clinical trial expectations, disappointing investors banking on this growth driver.
What They’re Saying:
"Consumers are feeling the benefits of slowing inflation but remain cautious about their financial footing. The Fed’s measured approach is well-aligned with this improving backdrop," said BMO in a client note.
WHAT WE’RE WATCHING
Events
There are no events scheduled for today.
Earnings Reports
Today: BHP Group
Tomorrow: Sonder, Procaps Group
MARKET BRIEF
Leading News
Palantir and Anduril Forge Alliance to Disrupt Defense Giants
Why it matters:
A potential tech consortium spearheaded by Palantir (PLTR) and Anduril could revolutionize defense contracting, bringing cutting-edge innovation to the Pentagon and challenging entrenched defense giants.
Zoom Out:
The traditional defense industry has long been dominated by heavyweights like Lockheed Martin (LMT) and Raytheon (RTX), but a seismic shift may be underway. According to the Financial Times, Palantir and Anduril are in talks with tech players like SpaceX, OpenAI, and Scale AI to create a new model for delivering advanced technologies to the U.S. military.
This alliance could signal the rise of "next-gen contractors" focused on agility, efficiency, and AI-driven capabilities. Early indications of this partnership emerged earlier this month with the integration of Palantir's AI Platform and Anduril's Lattice software, setting the stage for a broader collaboration.
The first formal partnerships could be unveiled by January, potentially reshaping how the Pentagon buys advanced tech.
Key Insights:
Tech Meets Defense: A consortium of this caliber could deliver faster innovation cycles, incorporating AI, space tech, and autonomous systems into military applications.
Prime Disruption: This effort aims to sidestep traditional bureaucracy and challenge the entrenched "prime" contractors that dominate the sector, carving out space for more dynamic players.
Broader Implications: Success here could spill over into commercial markets, with ripple effects for industries like logistics, aerospace, and cybersecurity.
Market Pulse:
"The Pentagon's procurement system has long needed disruption. If anyone can do it, it's these tech titans," an anonymous insider told FT.
Bull’s Take:
This consortium has the potential to inject Silicon Valley's velocity into defense contracting, creating opportunities for investors eyeing transformative tech sectors. For those bullish on the intersection of AI and defense, now is the time to track these innovators. Keep an eye on PLTR, as well as emerging players in AI and defense, for potential upside tied to this disruptive shift.
Headlines
FDA approves Eli Lilly’s obesity medication for obstructive sleep apnea (link)
US finalizes up to $6.75 billion in chips awards for Samsung, Texas Instruments, Amkor (link)
Carnival ends 2024 with record revenue, sails into 2025 with high expectations (link)
Stellantis reverses Ohio layoffs weeks after CEO's abrupt departure (link)
Decaf Christmas: Starbucks strike expands to 10 major cities during busy holiday season (link)
JPMorgan, Wells Fargo, BofA facing federal lawsuit over Zelle payment network fraud (link)
Party City to close its stores as company files for bankruptcy (link)
CRYPTO
Fear & Greed
Headlines
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On the Socials
*Hat-tip to netcapgirl