September 15, 2024: Best 2024 Weekly Gains After Worst Week In Over A Year

Markets had a dramatic revival mid-week, as result, Dow Jones closed the week up 2.6%, S&P 500 was up 4%, and Nasdaq Composite gained 5.95% — their best weekly gains of the year. Market participants are widely expecting a Fed rate cut next week, with some disagreement over whether the Fed cuts 25 or 50 bps. OpenAI is reportedly raising up to US$7 billion at a US$150 billion valuation — making it worth more than 88% of S&P 500 firms. Notably, ChatGPT has passed 11 million paying subscribers. The CEOs of Nvidia, Microsoft, CoreWeave, Amazon Web Services and OpenAI met with the U.S. secretaries of energy and commerce at the White House on Thursday to discuss how the energy grid would handle growing power needs from AI and how to speed up the development of AI-focused data centers. Bitcoin prices and Coinbase shares fell after the U.S. presidential debate. Adobe shares tanked on lower year-end guidance. The European Court of Justice has ruled against Apple and Google on Tuesday, imposing billions in penalties against the tech giants. Apple will have to pay 13 billion euros in back taxes to Europe. In Canada, Sophic Client NowVertical Group streamlined its LATAM business structure, with a cash payment of US$130K satisfying all earn out obligations and the remaining holdback amount payable to the A10 vendors. Sophic Client, Plurilock entered a Critical Services partnership with TD SYNNEX to provide AI services in North America. Sophic Client, Clear Blue Technologies, announced a couple contracts in Africa. Shopify is adding PayPal to help process credit and debit card transactions for its Shopify Payments payment processing service in the U.S. BDC is writing its down venture capital portfolio by $220 million. BDC said in its report that it expects “challenging market dynamics for venture capital” to persist in fiscal 2025.

Sophic Client NowVertical Group (NOW-TSXV, NOWCF-OTCQB) streamlines LATAM business structure.

NowVertical Group completed the restructuring of its obligations in respect of Group Analytics 10 and Inteligencia de Negocios and its affiliate entities (together, “A10”) as part of restructuring its LATAM operations. This restructuring releases the Company from all current and future obligations relating to the A10 Group, which was acquired in February 2023, in exchange for a one-time cash payment of US$130,000 to be paid by the Company in installments. The cash payment satisfies all earn out obligations and the remaining holdback amount payable to the A10 vendors. https://bit.ly/4cXFXL6

Sophic Client Plurilock (PLUR-TSXV, PLCKF-OTCQB) enters Critical Services partnership with TD SYNNEX to provide AI services in North America.

Plurilock Security announced a partnership with TD SYNNEX (NYSE: SNX), a leading global distributor and solutions aggregator for the IT ecosystem, to provide artificial intelligence (“AI”) services in North America. Under the terms of the partnership, Plurilock will provide AI-focused critical services and cybersecurity solutions for TD SYNNEX across their North American operations. The services and solutions provided may include, but are not limited to: security operations; offensive security and penetration testing; data and intellectual property protection and loss prevention; Zero Trust architecture and implementation; digital and AI transformation; and related advisory and governance, risk, and compliance (GRC) services. This represents the initial phase of a potential wider partnership, with the possibility of future expansion into the company’s global footprint. https://bit.ly/3AVgJj6

Sophic Client Clear Blue Technologies (CBLU-TSXV, CBUTF-OTC, 0YA-FRA) signs notice of award with growth energy for diesel replacement project in Africa.

Clear Blue Technologies announces the execution of a Notice of Award agreement with Growth Energy, a company which specializes in the development, EPC and O&M for clean energy power plants in Africa. The project is in the final stages of contract negotiations, with preparation for financing disbursement and commencement of the EPC phase currently underway. Phase 1 of the project is scheduled to ship in 2024, with two additional phases planned thereafter, totalling a potential $4 million across three phases from 2024 through 2026. https://bit.ly/3XlCnEF

Sophic Client Clear Blue Technologies (CBLU-TSXV, CBUTF-OTC, 0YA-FRA) to provide renewable energy solutions for telecom sites in rural South Sudan and the Democratic Republic of the Congo.

Clear Blue Technologies has entered into an agreement to provide 100% renewable energy solutions for rural telecommunications sites in South Sudan and the Democratic Republic of the Congo (DRC). https://bit.ly/3zd7Q44

Shopify (SHOP-NYSE, SHOP-TSX) adds PayPal as payment processor in the U.S.

Shopify is adding PayPal to help process credit and debit card transactions for its Shopify Payments payment processing service in the U.S., PayPal said Monday. PayPal will join Stripe, which handles much of Shopify’s U.S. payment processing business. It marks PayPal’s latest effort to reinvigorate its business under CEO Alex Chriss and strengthen its ties with Shopify. Under Chriss, who took over as CEO in September 2023, PayPal has moved to catch up to Stripe and other competitors like Adyen, which have grown more quickly than PayPal has in recent years, The Information previously reported. Part of that strategy has included adding a more streamlined checkout process that saves and automatically fills in users’ card and shipping information, known as Fastlane, as well as striking more partnerships—sometimes directly with competitors. In late August, PayPal announced that Adyen would offer Fastlane to some of its merchants in the U.S. With the new partnership, PayPal is edging in on Stripe’s territory. Shopify, which has reportedly invested more than US$350 million in Stripe, uses Stripe’s technology to power several other financial services it offers merchants like money management and spending cards, in addition to payment processing. “Stripe remains our primary payment processor for Shopify Payments, and we maintain a close relationship with both Stripe and PayPal to create the best possible payments experience for our merchants,” a Shopify spokesperson said in a statement. https://tinyurl.com/mtuxxhff

BDC writes down venture capital portfolio by $220 million in annual report.

The Business Development Bank of Canada (BDC) has reported a significant loss in value for its venture capital portfolio in its latest annual report. According to its report, BDC’s VC division authorized a total of $403.6 million in investments during fiscal 2024 (which encompasses the year ended March 31, 2024). This is a decrease from the $526.7 million BDC approved in the previous year, a decision it attributed in part to “declines in Canadian venture capital activity and a slower pace of fundraising.” BDC said in its report that it expects “challenging market dynamics for venture capital” to persist in fiscal 2025. Of the total funds BDC approved in fiscal 2024, $234.6 million went into direct equity investments and $171.9 million went to indirect equity investments into funds. BDC’s plan anticipated the value of the investments in its VC portfolio to increase by $33 million in fiscal 2024. However, that value actually decreased by $220 million over the year. At the end of fiscal 2024, BDC’s adjusted return on equity totalled four percent, which was lower than the planned 6.2 percent. BDC said this drop is mostly because its VC investments lost more value than expected. https://tinyurl.com/zy9kuc7h

Transit platform Spare raises $42 million Series B led by Inovia.

Vancouver-based transit software startup Spare has secured a $42 million Series B round as it looks to carve out a place in the paratransit sector. Spare is currently present in more than 200 cities across North America, Europe, and Asia. The round was led by return investor Inovia Capital with participation from other returning investors, including Kensington Capital and Nicola Wealth. The funding will be used to expand its global reach into more transit agencies, accelerate the development of its AI-driven platform, and meet growing demand for its transit solutions, particularly in the paratransit sector. https://tinyurl.com/u8zste58

OpenAI is reportedly raising at a US$150 billion valuation — making it worth more than 88% of S&P 500 firms.

OpenAI is reportedly raising money at a US$150 billion valuation — more than the market capitalization of over 88% of S&P 500 firms, including Goldman Sachs, Uber, and BlackRock. OpenAI is also looking to raise US$5 billion in debt, Bloomberg reported. The new valuation makes the startup one of the most valuable in the world — and it’s a big jump from the company’s previous US$86 billion valuation. This figure was calculated when the company allowed employees to start selling stakes in the company in February. The funding round will be led by Josh Kushner’s Thrive Capital, a New York venture firm known for its early bets on startups including Instagram, Stripe, Robinhood, Spotify, and Slack. Microsoft, which has been a partner since 2019, Apple, and even Nvidia have also been discussing investing in the ChatGPT maker. https://tinyurl.com/2ufm8bhc

OpenAI talks to UAE for funding as ChatGPT passes 11 million subscribers.

OpenAI has been talking to a UAE state-backed fund about participating in the artificial intelligence developer’s capital raise of up to US$7 billion, The Information reported Thursday. The fund, MGX, would join existing investors Thrive Capital, Microsoft, Khosla Ventures and others in the new round. OpenAI needs the money, as its losses have been mounting. But the company’s revenue engine, ChatGPT, is also humming, passing 11 million paying subscribers, The Information also reported Thursday. That mark means the company is generating more than US$333 million a month in revenue from ChatGPT subscriptions and payments made by app developers for gaining access to OpenAI’s large language models. https://tinyurl.com/3zrfry99

Nvidia, OpenAI CEOs talk to Biden officials about energy needs for AI.

The CEOs of Nvidia, Microsoft, CoreWeave, Amazon Web Services and OpenAI met with the U.S. secretaries of energy and commerce at the White House on Thursday to discuss how the energy grid would handle growing power needs from artificial intelligence and how to speed up the development of AI-focused data centers, according to a government press release. Nvidia CEO Jensen Huang told CNBC after the meeting that he expects there will have to be a “public-private collaboration” to avoid power constraints because “the rate of growth is really quite high.” He didn’t provide details. A spokesperson for Nvidia declined to comment. The White House later announced several initiatives, including a new task force focused on AI data center development, which would ensure projects align with U.S. economic, security and environmental goals. The White House also said it is looking at ways to accelerate the permitting and construction of data centers by working with developers and state and local authorities. https://tinyurl.com/yc79e53s

Insight sells cyber firm to Mastercard for US$2.65 billion.

Mastercard said it would acquire cybersecurity firm Recorded Future from private equity and venture capital firm Insight Partners for US$2.65 billion, a sizable gain for Insight which acquired the firm in 2019 for US$780 million. Mastercard says Recorded Future analyzes data to provide “real time visibility into potential threats,” a service that will complement Mastercard’s existing cybersecurity capabilities. The card-issuing giant said Recorded Future had more than 1,900 clients globally, implying it has grown significantly since Insight bought it. Then, Insight said Recorded Future had 400 clients. https://tinyurl.com/mr2b4x2f

Flutter to buy stake in Brazil’s NSX Group for US$350 million.

International sports betting operator Flutter Entertainment Plc agreed to acquire an initial 56% stake in Brazil’s NSX Group for a cash consideration of about US$350 million. The deal is part of its strategy to invest in leading gaming companies in international markets, Flutter said in a statement on Friday. https://tinyurl.com/3edxct77

Bitcoin, Coinbase shares fall after Trump-Harris debate.

Bitcoin prices and shares in crypto exchange Coinbase fell after the presidential debate between Donald Trump and Kamala Harris on Tuesday night, as traders see a higher chance of Harris winning the U.S. 2024 presidential election. Bitcoin fell 3% to US$55,795 and Coinbase shares fell 4.8% to US$150 as of Wednesday 10:40 am in New York. Trump has positioned himself as a crypto-friendly candidate, vowing to end the current administration’s crackdown on the industry. Harris has not made clear her stance on crypto issues. Crypto was not mentioned during Tuesday’s debate. https://tinyurl.com/p7hbmv6z

Adobe shares tank on lower year-end guidance.

Software firm Adobe reported 11% revenue growth in its third fiscal quarter, a slightly faster growth rate than the previous quarter, as demand grew for Adobe’s image generation model, Firefly. But lower-than-expected projections for the fourth quarter sent Adobe stock down 10% in after-hours trading. If Thursday’s after-hours share price holds, Adobe’s stock will be nearly flat over the past 12 months and down 8% in 2024. Over the past year, Adobe has been struggling with a growth slowdown caused partly by companies pulling back on buying new software. Its Creative Cloud suite, which includes apps such as Photoshop and Acrobat Pro and comprises the majority of its largest revenue segment, had struggled to lure new customers since the start of last year, reporting flat or negative year-over-year growth in annual recurring revenue from new customers each quarter since. But it finally returned to expansion with a 2.7% increase in that figure in the third quarter. https://tinyurl.com/yhjcm6ry

Palantir, Dell join S&P 500 Index as AI revenue boosts their shares.

Enterprise software firm Palantir and data center server provider Dell are joining the S&P 500 index of stocks, S&P Global said late Friday, while American Airlines and product marketplace Etsy are being removed. Both Palantir and Dell have benefited from the generative artificial intelligence boom. Dell sells servers powered by Nvidia’s AI chips and Palantir sells analytics and AI software to governments and businesses. Dell’s stock is up 37% so far this year, giving it a market capitalization of more than US$70 billion; shares rose 5% in after-hours trading Friday, as its inclusion in the index will make it more attractive to equity buyers. Palantir shares are up 83% so far this year, giving it a nearly US$70 billion market cap; shares rose 8% in after-hours trading. https://tinyurl.com/59sb4tne

Huawei unveils tri-fold phones to challenge iPhone in China.

Chinese tech giant Huawei Technologies unveiled its latest smartphone, a tablet-sized smartphone that can be folded twice, just hours after Apple’s highly anticipated new iPhone announcement. The so-called tri-fold phone underscores Huawei’s resilience in the face of the U.S. sanctions imposed since 2019 and solidifies its position in the Chinese smartphone market against Apple. The new Huawei device, the Mate XT, will be released on Sept. 20. That’s the same day as Apple’s new iPhone 16, setting the stage for a showdown between the two companies in China. However, the impact of Huawei’s latest smartphone on Apple’s China business is uncertain, given the foldable’s hefty price tag of more than US$2,800. That’s significantly more than the US$1,600 price tag of Apple’s most expensive iPhone 16 even with all its specs are maxed out. Over the past year, Huawei has steadily chipped away at Apple’s market share in China, with its Mate 60 series, a smartphone that demonstrated to the world how the company could navigate U.S. sanctions to still produce advanced chips. https://tinyurl.com/5c493kbf

OpenAI releases Strawberry reasoning model to paying customers.

OpenAI on Thursday released a first version of its highly anticipated Strawberry artificial intelligence that aims to reason through complex problems just as it raises up to US$7 billion from Thrive Capital and potentially also from a UAE state-backed investment firm, MGX. The model, officially known as o1-preview, is being made available first to paying ChatGPT users and to developers who have already spent more than US$1,000 to use OpenAI’s technology. The company said it would give users of the chatbot’s free tier access to a smaller, “mini” version of o1-preview. OpenAI has used the same strategy with prior models it released in ChatGPT. A more mature version of o1 is still under development, the company said. Unlike previous models, o1-preview aims to solve customers’ problems, such as how to develop marketing strategies or handle engineering challenges, by spending more time thinking through potential answers before sharing them. OpenAI said o1-preview got high scores on biology, chemistry, and physics questions, outperforming PhD students from those fields in tests that OpenAI organized. The biology capabilities prompted OpenAI to label o1-preview as being at “medium” risk of helping customers produce biological weapons, though it said the model uses reasoning to avoid generating harmful content. That’s the first time OpenAI has given one of its models such a designation. OpenAI has said it wouldn’t release a “high” risk model. Perhaps anticipating questions about the safety of o1-preview, OpenAI this summer demonstrated it to national security officials in Washington, D.C. https://tinyurl.com/mr384ydh

Apple shows off AI-powered iPhones, Watch.

Apple unveiled the next generations of the company’s devices on Monday, many of which will use Apple Intelligence, the AI technology Apple previewed in June that taps OpenAI’s ChatGPT for some queries. Siri will receive an AI makeover that will allow users to direct the virtual assistant to execute actions like finding and sending photos on the new iPhone 16, as well as the earlier iPhone 15 Pro and Pro Max with an update to the latest operating system. The new iPhones include AI-powered writing tools, such as rewriting text with different tones and producing transcripts and summaries from audio recordings. Some of the new features catch Apple up to those offered by handset makers that use Google’s Android operating system. Users of the latest phones will also be able to get information by training their cameras at an object. In the example, a user snapped a photo of their lecture notes and asked OpenAI’s ChatGPT to help explain the concepts. https://tinyurl.com/smz8buay

Sports bets hitting US$220 billion has financial advisers on alert.

With the proliferation of mobile betting apps like FanDuel and DraftKings, plus betting kiosks at stadiums across the country, even small bets make for big business. The US sports gambling industry has seen more than US$220 billion wagered in the five years since the Supreme Court essentially legalized what was long an underground aspect of fandom. Financial advisers are among those on alert for the consequences of this massive shift in how average fans engage with their favorite teams. It’s especially critical as data shows excess pandemic savings were extinguished earlier this year. Early studies have determined that online betting is adding to consumer stress. Another research paper found that some Americans are taking money out of their brokerage accounts to fund wagers. And in extreme cases, losses from gambling can contribute to auto loan delinquencies and bankruptcies. One industry group estimates Americans bet US$26.7 billion on last year’s NFL season, and the figure is expected to grow. The overwhelming majority will lose their money. Sports fans often think they have an edge because of their perceived knowledge of the leagues and players, but in fact, most end up losing, Whyte said. Data on percentage of winning bets are sparse, but by one measure, only 3% of sports gamblers are profitable long term. https://archive.ph/KVIe3

Goldman Sachs still working to exit Apple Card partnership as consumer losses top US$6 billion.

Goldman Sachs is still looking to exit its partnership with Apple as losses continue to mount. As detailed in a new report from The Wall Street Journal, Goldman Sachs will take a US$400 million hit this quarter due to its floundering consumer business. Goldman Sachs had planned to use Apple Card to bolster its efforts to expand into consumer banking. In the intervening years, however, the bank has decided to exit the consumer business altogether, including consumer loans and other offerings. Looking toward the future, Goldman Sachs is still looking to exit its partnership with Apple, which consists of the Apple Card and Apple Card Savings Account. Currently, Apple Card credit card balances total US$17 billion. https://tinyurl.com/5n954ux5

Microsoft lays off 650 more Xbox employees.

Microsoft is laying off around 650 employees in its gaming division today. The latest cuts come months after Microsoft laid off 1,900 Activision Blizzard and Xbox employees, and after the closure of several game studios. The cuts are related to the Activision Blizzard deal. https://tinyurl.com/kfkm7j74

European Court of Justice rules against Apple and Google on penalties.

The European Court of Justice ruled against Apple and Google on Tuesday, imposing billions in penalties against the tech giants. Apple will have to pay 13 billion euros in back taxes to Europe, as a result of the court ruling which overturned a 2020 lower court judgement in favor of Apple. Today’s decision reaffirmed a 2016 decision by the European Commission that Apple had “received tax advantages that constituted state aid” from Ireland, which it said was “unlawful and incompatible” with the European market. Separately, the court affirmed lower court rulings that Google had to pay a 2.4 billion euro fine “for having abused its dominant position” in the search market by “favoring its own comparison shopping service over those of competitors.” Neither of the fines are financially significant for the companies. Apple, which had US$153 billion in cash and investments at the end of June, has set aside US$14 billion in escrow pending the court ruling, according to securities filings. Google had US$101 billion in cash and short term investments at June 30. https://tinyurl.com/8kwwune

Microsoft is building new Windows security features to prevent another CrowdStrike incident.

Microsoft is announcing plans to make changes to Windows that will help CrowdStrike and other security vendors operate outside of the Windows kernel. The announcement stems from a Microsoft-hosted security summit earlier this week at the company’s Redmond, Washington, headquarters, where it discussed changes to Windows in the wake of the disastrous CrowdStrike incident in July. Windows kernel access has been a hot topic ever since the CrowdStrike catastrophe took down 8.5 million Windows PCs and servers. CrowdStrike’s software runs at the kernel level of Windows — the core part of an operating system that has unrestricted access to system memory and hardware. https://tinyurl.com/y6au2mxy

White House says it will crack down on trade provision used by Shein, Temu.

The Biden administration said Friday it would move to significantly limit a trade provision used by e-commerce companies like Temu and Shein, as part of an effort to crack down on illegal and unsafe goods entering the U.S. The provision, known as de minimis, allows individuals to import up to US$800 worth of goods each day tax-free. Shein and Temu have used this provision to ship items directly from manufacturers, typically in China, to shoppers in the U.S. without paying tariffs. As the sites have grown in popularity, the number of overall de minimis shipments has exploded—customs officials say the U.S. is on pace for roughly 1.5 billion de minimis shipments this year, compared to about 500 million in 2019. The proposed changes would exclude most shipments of apparel and textiles from China from using the de minimis exemption, which could significantly increase costs for both retailers and shoppers. Both Shein and Temu have said previously that they do not rely on de minimis to make money. The White House also called on Congress to pass legislation with changes to de minimis. https://tinyurl.com/y26y8cm4

Trading App eToro to limit crypto offerings in SEC settlement.

Trading platform eToro will stop offering trading in nearly all types of crypto assets as part of a settlement with the U.S. Securities and Exchange Commission. The settlement comes amid broader SEC scrutiny of retail stock trading apps that offer crypto services. Robinhood, for example, in May got a warning from the SEC about potential enforcement action over its crypto offerings. eToro agreed to pay $1.5 million to settle SEC claims it operated an unregistered broker and clearing agency for facilitating trading of crypto assets that the regulator deemed as securities. It neither admitted nor denied the SEC’s findings. Going forward, the only crypto assets that U.S. customers can trade on eToro will be bitcoin, bitcoin cash, and ether. https://tinyurl.com/2v6byjyx