Oracle's Surprise Drop The Mike Moment

Good Afternoon. All major indices ended in green for the week powered by the in line CPI inflation data and the

Below are the key things to note this week:

Oracle - The New Nvidia:
Oracle's stock jumped 25% for the week, and it was up more than 40% on the day of results. The main reasons for such repricing of Oracle stock are the RPO numbers, which implied $300bn of new business in just 3 months— more on RPO in Curated Insights.

Gemini IPO:
Another crypto-related stock had a successful IPO this week. Gemini, the crypto exchange founded by the Winklevoss brothers, raised $425 million in an initial public offering.

OpenAI Restructuring:
OpenAI and Microsoft finally agreed to the terms to restructure OpenAI as a profit-making organization from its current non-profit structure. The negotiations were on for a year. This paves the way for OpenAI IPO.

Rate Cut Almost Confirmed:

• No Surprise with CPI Data:
  The CPI inflation numbers were mainly in line with consensus estimates, with the annual headline number at 2.9%. The Fed’s official measure, the PCE, also did not surprise in the latest reading. The inflation has consistently exceeded the Fed’s target for over 5 years now, and it's expected to remain sticky for quite some time, especially with the expected one-time effect of the tariffs. The BLS’s monthly jobs data comes from business surveys, while the newly released annual update relies on more comprehensive state unemployment tax records filed by employers.

• Record Preliminary Revision In Jobs Numbers:
  The Labor Department said job growth was overstated, with 911,000 fewer jobs added from early 2024 to March. That cuts reported gains by more than half, lowering the average monthly increase from 147,000 to just over 70,000. This raises questions about the health of the labor market and puts the FOMC’s two mandates, inflation and unemployment, at odds with each other. With inflation primarily in control at around 3% for a while and down significantly from last year, it’s clear that the Fed will prioritize the labor market concerns and cut rates in next week’s meeting.
  

  

  Source: WSJ

  
  The BLS’s monthly jobs data relies on business surveys, while the annual benchmark uses comprehensive state unemployment tax records. Tuesday’s release was a preliminary step in this process, with the final revision due in February—likely less negative than the early estimate.
  

For the week:

• The S&P 500 is up 1.59%, the Nasdaq is up 2.03 %, and the Dow 30 is up 0.95%.

  

  Barchart

CNN's Fear & Greed Index now stands at 54 (Neutral) out of 100, up 1 point from last week. Details here

The top five trending stocks on Reddit are OpenDoor, Tesla, SPY, Loan Depot, and Oracle. Read More

Here is a summary of this week’s key economic releases:

Target Rate Probabilities for September 17th FOMC Meeting:

CME FedWatch

Another Crypto IPO: Gemini Space Station Inc., the crypto exchange led by the Winklevoss twins, raised $425M in its IPO. Shares closed at $32, 14% above the $28 offer price, after a volatile debut with two trading halts. The listing values Gemini at over $3.5B, down from its $7.1B valuation in 2021. Read

OpenAI Restructuring: OpenAI is moving closer to a traditional for-profit structure, finalizing talks with Microsoft and setting terms for at least $100B in equity for its nonprofit. The new plan keeps control with the nonprofit, giving it a stake that could make it among the best-funded philanthropic groups globally. Read

Record BuyBacks: Global corporate buybacks are on track to hit a record $1.9T in 2025, JPMorgan said, with $1.37T already completed in the first eight months. That’s 38% growth from last year, well above the 15% rise in equity prices, though buybacks as a share of market cap remain near historical norms. Read

Robinhood Social: Robinhood launched Robinhood Social, a platform resembling X, to draw investors to its brokerage and keep them engaged. Users can follow traders, discuss strategies, and share verified trades. CEO Vlad Tenev said it could become a source of investing information. Read

Synopsys Miss: For the period ending July 31, Synopsys reported adjusted EPS of $3.39 on revenue of $1.74B, up 14% year-over-year. Design Automation revenue rose 23% to $1.31B, topping estimates, while Design IP revenue fell 7.7% to $427.6M, missing forecasts. Adjusted operating income was $669.8M. Analysts expected $3.80 EPS on $1.77B revenue.

Oracle Miss: Oracle reported adjusted EPS of $1.47 on revenue of $14.9B, up 12% year-over-year but slightly below analyst estimates. The company highlighted a growing backlog from new contracts, plans to share more on its financial strategy next month, and a stronger cloud infrastructure outlook on booming AI demand with several large new client wins.

Adobe Beat: For the quarter ended August 29, the company posted adjusted EPS of $5.31 vs. $5.18 expected, with GAAP EPS of $4.18 vs. $4.05. Revenue rose 11% YoY to $5.99B vs. $5.91B, led by digital experience up 9.6% to $1.48B and subscriptions up 12% to $5.79B, while product revenue fell 17% to $68M. RPO climbed 13% to $20.44B, beating estimates. Q4 guidance: revenue $6.08–$6.13B (midpoint $6.105B) and adjusted EPS $5.35–$5.40, both above consensus.

Kroger Mixed: Kroger revenue came in at $33.94B, flat from last year, though last year included $718M from Kroger Specialty Pharmacy. Excluding fuel and pharmacy, sales rose 3.8%. Identical sales without fuel grew 3.4%, while eCommerce climbed 16%.