1. “Stargate”

Oracle and ARM jumped more than 10% as they team up with SoftBank Group and OpenAI to form a $500 billion joint venture that will fund artificial intelligence infrastructure.

The initial equity will come from SoftBank, OpenAI, Oracle and Abu Dhabi state investor MGX, but Trump announced it.

Meanwhile, Arm Holdings, Microsoft and Nvidia will provide technology, along with Oracle and OpenAI, SoftBank said.

2. It’s all about the AI value chain and more specifically about the middle layer, ie the data infrastructure layer.

These data infrastructure companies play a pivotal role in enabling the development, deployment, and operation of AI systems and Large Language Models (LLM).

3. The Stargate deal set fire to the entire “power and data centers” space.

AI leaders have been raising concerns that more data centers and the chips, electricity, water, and other resources needed to run them are critical to powering the U.S.’s AI ambitions in the years ahead.

4. Artificial intelligence has made electricity a hot commodity and big oil companies are also trying to get a piece of it.

“Both Exxon Mobil and Chevron said last month that they are talking to potential data-center customers on deals to supply natural-gas-fired power paired with carbon-capture technology.

Major oil companies also are able to move fast—something tech giants value.

They can site power plants near the source of fuel—near their own oil and gas fields—and sell electricity directly to data centers without needing to connect to the grid.”

5. A scenario in which all European NATO members spend 3% of GDP would require an additional ~$200bn per year (up ~50%).

Analysts forecast a multi-year upcycle in European defense spending and expect clear political commitments to be made in 2025.

Also, Europe would need to spend over $2tn just to make up for the “underspend” over the last 30 years.

6. “Now could be the time to look at European quality stocks again.”

“Sentiment toward the euro and the Europe quality factor remains low, presenting an attractive risk-reward opportunity,” says JPMorgan, recommending going long the strategy to capitalize on the potential decline in US yields if the new White House team delays EU tariff hikes.

The so called “GRANOLAS,” a Goldman Sachs basket composed of European megacaps with the strongest financial attributes — GlaxoSmithKline, Roche, ASML, Nestle, Novartis, Novo Nordisk, L’Oreal, LVMH, AstraZeneca, SAP and Sanofi — have suffered especially and could stage a comeback.

Their performance depressed European benchmarks, given their 20% weighting in the Stoxx 600, but the stocks’ defensive nature could be useful in a more uncertain environment, such as Trump’s second term.

Meanwhile, lower interest rates could also boost these stocks as they tend to underperform when rates are rising, given they are considered as relatively long-duration assets.

The basket carries a P/E ratio of about 17 times forward earnings, down from 22 times back in 2021.

Its premium to the broader Euro Stoxx 50 benchmark has dropped from a high of 70% to just 20%.

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