📈 ServiceTitan's $6.3B IPO

Microsoft says no to Bitcoin amid $800M charge with GM, Supreme Court allows class action against Nvidia, Adobe shares fall 9%, Albertsons sues Kroger for failed merger, Tech IPOs Are Back in Business

Good morning.

⚡ The Fast Five → Microsoft says no to Bitcoin amid $800M charge with GM, Supreme Court allows class action against Nvidia, Adobe shares fall 9%, Albertsons sues Kroger for failed merger, Tech IPOs Are Back in Business

🔎 Market Trends → Tame US inflation boosts S&P 500, Nasdaq rallies above 20,000; US Futures Ease After Record Setting Rally

And now…

⏱️ Your 5-minute briefing for Thursday, December 12, 2024:

MARKET BRIEF
Before the Open

As of market close 12/11/2024.

Pre-Market

  • Broadcom shares jumped 6.6%, the top gainer on the S&P 500 and the Nasdaq

  • Albertsons shares dropped 1.5%

Fear & Greed

 

Markets in Review

Tech Triumphs! Nasdaq Soars Above 20K as Innovation Ignites Growth (But Keep an Eye on Inflation)

Forget the champagne (for now). The Dow dipped slightly, but the Nasdaq blasted past 20,000 for the first time, fueled by tech giants. Oil prices surged on OPEC cuts and supply concerns.

The Big Picture:

The tech-heavy Nasdaq stole the show, jumping 1.8% on the back of Alphabet's (GOOG) AI breakthrough and a wave of innovation from other tech titans. Communication services also boomed, while healthcare lagged. Despite a tame CPI report, inflation remains a potential headwind. Keep an eye on next week's Fed meeting for a potential rate cut.

Market Movers:

  • Alphabet (GOOG): Climbed +5.5% as it unveiled its next-gen AI, Gemini 2.0, propelling its stock and fueling optimism across the sector. Tesla (TSLA +5.9%), Amazon (AMZN +2.3%), and Meta (META +2.2%) all joined the party.

  • Broadcom (AVGO): Skyrocketed +6.6% after news of a partnership with Apple (AAPL -0.5%) on an AI server chip. This win-win could be a game-changer for both companies.

  • Albertsons (ACI): Slumped -1.5% after its Kroger (KR +1%) merger fell through. Macy's (M -0.8%) also dipped due to accounting issues.

What They’re Saying:

"The November CPI is a reminder that inflation isn't vanquished, but steady progress is being made," - TD Economics.

WHAT WE’RE WATCHING
Events

  • Today: Bur. of Labor Statistics - Finished and Core Finished Goods Producer Price Index (PPI) - 8:30am

  • Why You Should Care: It's a leading indicator of consumer inflation - when producers charge more for goods and services the higher costs are usually passed on to the consumer.

Earnings Reports

  • Today: Broadcom, Costco Wholesale

  • Tomorrow: Soho House, Veru Inc.

MARKET BRIEF
Leading News

ServiceTitan's IPO: Silicon Valley Finally Fixes the Plumbing Problem

Why it matters:

The first major tech IPO of 2024 just priced above expectations, suggesting institutional investors are ready to warm up to growth stocks again — even if they're still losing money.

Zoom Out:

After a two-year deep freeze in tech IPOs, ServiceTitan (TTAN) is melting investors' cold feet with a $6.3 billion valuation that would have seemed unthinkable just months ago. The cloud software provider for contractors — think of it as the Salesforce for plumbers — is betting that Main Street's digital transformation still has room to run.

What's particularly intriguing is the timing: With the Fed signaling rate cuts on the horizon, growth investors appear ready to wade back into the IPO waters, albeit with a more discerning eye than during 2021's everything rally.

Deep Dive:

  • The "picks and shovels" play: While consumer tech grabbed headlines in recent years, ServiceTitan built a $800M+ annual revenue business by modernizing unglamorous but essential trades. It's a reminder that some of tech's best opportunities lie in digitizing traditional industries.

  • Show me the (future) money: Despite widening losses, investors are betting on ServiceTitan's 24% revenue growth — modest by 2021 standards but impressive in today's higher-rate environment. The company's "land and expand" strategy with contractors mirrors the successful playbook of software giants like Adobe.

  • Smart money signals: When sophisticated investors like TPG and Iconiq agree to "compounding ratchet" terms pushing for a quick IPO, it often suggests confidence in the company's near-term trajectory.

Market Pulse:

"This IPO isn't just about one company — it's a litmus test for the entire tech sector's ability to access public markets in 2024," says veteran IPO analyst Tom Smith at Renaissance Capital.

Bull’s Take:

For investors seeking growth exposure with a dash of recession resistance (people's pipes still break in downturns), ServiceTitan offers an intriguing way to play the ongoing digital transformation of America's $800 billion home services market. Just remember: Even the most promising IPOs often need time to find their sea legs.

Headlines

  • Microsoft expects $800 million impairment charge in Q2 2025 over General Motors' Cruise exit (link)

  • Supreme Court allows investors’ class action to proceed against microchip company Nvidia (link)

  • Adobe disappoints investors in this crucial metric, and shares fall nearly 9% (link)

  • Albertsons sues Kroger for failing to win approval of their proposed supermarket merger (link)

  • Elon Musk’s net worth surpasses $400B mark — a historic first — as value of Tesla, SpaceX surge (link)

CRYPTO
Fear & Greed

 

Headlines

  • Bitcoin Crosses Above $101K as XRP, AI Tokens Lead Crypto Rally Following CPI (link)

  • Microsoft shareholders say NO to Bitcoin amid volatility concerns (link)

  • Dogecoin, WIF and other memecoins crash hardest amid $1.7B crypto liquidations (link)

DAILY SHARE
On the Socials

*Hat-tip to Consulting Comedy