AnalytixInsight

Friday was the last day of the Santa Claus rally — Dow Jones was down 0.4%, S&P lost 0.5%, Nasdaq fell 0.7% during that period this time around. While this could presage larger declines during the year, 2023 and 2024 had weak Santa Claus rallies as well, and despite major indices ending the week down – Friday saw strong rebounds. Nvidia CEO, Jensen Huang’s CES 2025 keynote address could provide readthroughs for investors. Amazon struck a warrant deal with electronics manufacturer Jabil. Amazon has a record of equity-for-spending deals with its suppliers. Shares of Carvana fell 2% after Hindenburg Research, published a short report. Tesla said it sold fewer electric vehicles in 2024 than the prior year for the first time since 2010, as China’s electric-vehicle leader BYD posts record sales in 2024. Microsoft is on track to spend US$80 billion on datacenters for running AI software in the twelve months ending in June. In Canada, two more tech companies were taken out last week. Quisitive will be acquired by H.I.G. Capital. For $0.57/sh in cash, a 57.1% premium to the 20-day VWAP. Tech services firm WWT will acquire Softchoice (SFTC-TSX) in all-cash deal, for $24.50/sh – a premium of ~ 32% on the closing price September 23, 2024, (day prior to commencement of the review process). Sophic Client Legend Power Systems announced upsizing of its Non-Brokered Private Placement and closing of first tranche at a price of $0.18/ Unit, distributing 4,233,167 Units for gross proceeds of $761,970. Sophic Client, NowVertical further enhanced core leadership alignment through debt-to-equity conversions. An aggregate entitlement of US$815,000, and US$151,200 will be settled via stock at 33c (11% discount to the last closing price), certain additional cash payments will be spread out over time. These agreements, combined with the previously announced LATAM market unit debt-to-equity conversion, deliver total cash outflow savings of approximately US$1.6 million, significantly supporting NowVertical’s organic growth strategy.

Even as markets rallied for most of last week, and closed up, Friday could have given some investors pause. Last week, Dow Jones gained 0.35%, S&P 500 rose 0.7%, Nasdaq Composite was up 0.8%. Palantir and Anduril, are in talks with about a dozen competitors to form a consortium that will jointly bid for US government work in an effort to disrupt the country’s oligopoly of “prime” contractors. The consortium is planning to announce as early as January that it has reached agreements with a number of tech groups. Companies in talks to join include SpaceX, OpenAI, Saronic, and Scale AI. xAI, which develops conversational artificial intelligence in competition with OpenAI, said Monday it raised a US$6 billion in equity financing round from a slew of investors, including new ones from the Middle East. xAI is also testing a standalone iOS app for its Grok chatbot. OpenAI on Friday revealed more details about its plan to get its for-profit arm out from under its nonprofit’s control. Microsoft is reportedly eyeing alternatives to OpenAI in its Copilot product. Big Tech’s spending frenzy on artificial intelligence will continue until the end of the decade, according to the head of Broadcom. Senior Spotify executives and board members have sold US$1.25 billion worth of the company’s stock in 2024 — including US$900 million in payouts for its two co-founders. In Canda, Payfare will be acquired by Fiserv, for $4.00/sh in cash, for total consideration of ~$201.5 million. The Purchase Price represents a premium of ~90% to the closing price on December 20, the last trading day prior to the announcement, and a premium of ~92% to the 60-day VWAP. Sophic Client, NowVertical Group’s LATAM leadership invests in the Company’s future growth through a debt-to-equity conversion. An aggregate of US$1.25 million will be settled via the issuance of 5,432,954 shares at a price of $0.33/sh per share, resulting in cash savings of US$770K in 2025. Bench, a Vancouver based bookkeeping startup that had raised more than US$100 million from well-known venture capital firms, has cut off its service to customers, effectively immediately.

Last week, Dow Jones lost 2.25%, S&P 500 fell 2% and Nasdaq was down 1.8%. That said, markets ended the week on a better note after the Fed’s less dovish outlook Wednesday. As we enter the seasonal Santa Claus period – it remains to be seen whether Friday’s gains are built upon. Regardless, risks are on the horizon in January – including, potential profit taking on 2024 gains for tax planning purposes and any US tariff related noise, which for now has been largely shrugged off by investors. Fintech Chime filed confidential paperwork for an IPO. Databricks raised US$8.6 billion in funding at a US$62 billion valuation, with plans to raise US$10 billion total. Micron’s shares tumbled on weak demand expectations for consumer chips. Accenture beat quarterly revenue estimates on strong demand for genAI services. Google released new AI reasoning models and prepped chatbots in search. OpenAI announced the new reasoning model, ‘o3’ and made ChatGPT available through phone, text. Chinese shopping app Temu was once again the most downloaded free app in the U.S. In Canada, VitalHub announced a $30 million bought deal. Sophic Client, Legend Power Systems announced a Non-Brokered Private Placement for aggregate gross proceeds of up to $1.5 million. The Company also reported Q4 (Sept) F2024 financial results. Revenue was $705 thousand versus $159 thousand in Q4 F2023. Sophic Client, NowVertical Group announced the release of a New AI financial agent, updating its NowHub-finance solution. Sophic Client, Cybeats provided an update, highlighting the Company’s progress since commercializing its products. BlackBerry will sell Cylance for $160 million, a fraction of the $1.4 billion it paid in 2018. Clio’s record-breaking funding round provided some interesting insight into Canadian companies’ preference to stay private for longer.

Markets ended the week mixed. NASDAQ was up 0.3% after hitting a record high Friday morning. Alphabet, and Broadcom rose on news, Tesla hit a record high. Dow Jones fell 1.8%, S&P 500 lost 0.6%. 10-year Treasury yield rose 25 basis points in its biggest weekly gain since October 2023 to 4.4%. ServiceTitan, ended its first day of trading as a public company with a 42% lift in its stock price to US$101, compared with its IPO price of US$71. The holding company of Coincheck debuted on the Nasdaq, making it the first Japanese cryptocurrency exchange to be listed in the US. Databricks nears a record US$9.5 billion VC raise, and is eyeing an extra US$4.5 billion debt deal — a deal that could become one of the largest venture capital funding rounds in history. Shares of Adobe and Oracle fell after their quarterly reports. Google announced new Quantum chip, leading to the stock breaking out. The Company also announced the second generation of its Gemini AI models, and unveiled a new operating system for augmented and virtual reality devices, along with a new headset. Microsoft shareholders rejected a proposal for the tech giant to possibly invest in bitcoin. D-Wave completed a US$175 million stock sale. Ackroo signed a definitive arrangement agreement to be acquired at $0.15/sh, a 25% premium over the last trading day’s closing price. Sophic Client American Aires provides record holiday shopping season sales performance, including 116% YoY order volume growth, 62% Gross Margin. In Q4 through Dec 3rd, the Company produced record order volumes of $6.72 million (+116% y/y). Gross Margin improved to 62% (from 60%). The Company also signed hockey star Max Domi teams as a Brand Partner as part of its expanding partner ecosystem. Sophic Client Plurilock secured a US$1.1 million order from a Fortune 50 U.S. conglomerate. Sophic Client Cybeats won a contract with another top 10 global medical technology provider.