A Chip Name You Probably Haven't Heard Of

One lesser-known chip company tied to U.S. AI infrastructure. One cloud player with a stronger setup than most investors realize. One data analytics business with exposure to government demand.

Plus six more. That's my full list this month — where I think AI capital rotates next, instead of chasing yesterday's move. 

Review the 9-stock list. 

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☕️ GM Munchers! My wife was mad at me last night, which means I spent the evening apologizing and agreeing with everything she said. Turns out that is also a decent strategy for surviving this market.

On today’s menu:

• 📉 The Bond Market Just Flashed A Warning

• 👟 Nike Just Hit Its Lowest Price Since 2014

• 📱Meta Goes To Trial

• 📆 The Nasdaq Is Introducing A New Trading Session

Yesterday’s numbers:

BREAKING NEWS

📉 The Bond Market Just Flashed A Warning

Here's something worth slowing down for. The 30-year Treasury bond, basically an IOU from the U.S. government that gets paid back in 30 years, just hit a yield of 5.31%. That is the highest it has been in 19 years.

Let's break down what a yield actually is, since this trips people up. When you buy a Treasury bond, you are lending money to the government. The yield is the interest rate they pay you back for that loan. When the yield goes up, it means the government has to pay more to convince people to lend it money.

• 💵 The government is borrowing a ton. The U.S. keeps running huge deficits, meaning it spends more than it collects in taxes and has to borrow the difference. More borrowing usually means paying higher rates to attract lenders.

• 🔥 Inflation fears are creeping back in. Investors are worried prices will keep climbing, and they demand a higher yield to protect themselves if that happens over the next 30 years.

• 🏠 This touches regular people fast. Mortgage rates, car loans, and business borrowing costs all tend to climb when long-term Treasury yields climb. This is not just a Wall Street problem.

Oil is adding fuel to the fire here too. Brent crude jumped above $90 a barrel after Iran said it will not extend a deal covering the Strait of Hormuz. Iran also threatened to escalate the conflict instead of calming it down. Higher oil prices usually mean higher gas and shipping costs, which feeds directly into the same inflation fear pushing Treasury yields up.

The Munch Take: A 19-year high on government borrowing costs, paired with oil prices climbing over Middle East tension, is not two separate stories. It is one story about investors getting nervous from two directions at once. My wife renegotiates every bill we have the second interest rates even whisper higher, and honestly the whole bond market is doing the same thing right now. Watch both of these together this week, because a bond market and an oil market getting spooked at the same time tends to get everyone else's attention too.

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STOCK OF THE DAY

👟 Nike Just Hit Its Lowest Price Since 2014

$NKE Nike stock fell to its lowest level since September 2014, dropping more than 4% to below $40 a share. The stock now sits nearly 78% below its all-time high of $179.10, set back in November 2021. That collapse has wiped out more than $200 billion in market value since the peak.

The trigger this time came from a competitor. On Holding, a smaller rival, gave weak full-year sales guidance last week, which spooked investors across the entire athletic apparel sector. But Nike's problems run deeper than one bad headline. China sales are expected to drop 20% this quarter, gross margin sits well below rivals like On and Lululemon, and the company is still working through a messy shift back toward wholesale stores after years of pushing direct-to-consumer sales too hard.

📈 The Bull Case:

• Still the market share leader: Nike remains the biggest sportswear brand in the world by sales, even after everything that has gone wrong.

• Running is actually working: Nike has posted five straight quarters of double-digit growth in its running category, and North America grew 3% last quarter.

• New leadership is trying to fix it: CEO Elliott Hill has been buying shares personally and is steering the company back toward the retail partners it walked away from.

📉 The Bear Case:

• China keeps getting worse: Nike is guiding for a 20% sales drop in China this quarter, one of its most important markets historically.

• Margins are falling behind: Nike's gross margin sits around 40%, well below On Holding's 64% and Lululemon's 55%.

• The dividend math looks tight: Nike's payout ratio could run above 100% of adjusted earnings in a stress scenario, raising real questions about whether the dividend stays where it is.

The Munch Take: Losing $200 billion in value and still being the biggest name in your industry is a strange kind of company to be. My wife has kept the same pair of Nike running shoes for three years and refuses to replace them even as they fall apart, which is either brand loyalty or a metaphor for this entire stock. Nike's brand and market share are still real. Whether this turnaround actually shows up in the numbers before the stock finds a bottom is the whole ballgame right now.

MARKET OVERVIEW

🍿 Tasty Movers & Shakers

👀 Bonus Report: Sell these "safe" blue chips immediately (From Chaikin Analytics)

⛽ $VIST Vista Energy popped 5.71% after Peter Thiel's hedge fund took a stake in the company. Nothing gets a stock moving like a famous billionaire quietly showing up on the shareholder list.

🛰️ $LUNR Intuitive Machines jumped 7.21% after getting the green light on a $600 million satellite communications program. That is a lot of money to point stuff at space.

📱 $META Meta slid 3.54% ahead of a major trial over claims its platforms harmed kids and teens. Courtrooms make investors nervous way faster than earnings misses do.

✈️ $BA Boeing dipped 2.47% after the U.S. Army temporarily grounded its fleet of Boeing-made Apache helicopters after a crash in Texas. Another day, another Boeing headline nobody wanted.

💊 $EYPT EyePoint Pharmaceuticals cratered 66.98% after its eye disease treatment missed its main goal in a Phase 3 trial. That is what a failed drug trial does to a small biotech stock in one trading session.

TRADING SUCCESS

🤑 Tuesday Motivation

🚀 Pre-Market Fuel

1. 📆 The Nasdaq is introducing a new trading session.

2. ⏰ Everything you need to know about Meta’s bombshell legal fight.

3. 🚀 Sandisk is going crazy again.

4. 🤔 Fun fact of the day.

🍪 Munchy Memes

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