Here’s what you need to know today

• Nvidia is the biggest story in markets. The world’s third largest company just suffered the largest one-day loss of value in history as shares fell 12% and lost $279 billion USD of market value. Why? The company forecast slower growth in a recent earnings report and US government regulators are investigating if Nvidia abused its market power.
  
  

• Australia’s latest GDP numbers show that the Australian economy grew 0.2% in the June quarter (the three months of April to June). For the 12 months to June, GDP grew 1%. This is the slowest rate of annual economic growth since the early-1990’s (excluding the COVID period).
  
  

• Looking under the hood, Australia’s GDP growth has been driven by government spending. Without it, Australia’s economy would have contracted last quarter. Government spending is now 27.6% of Australia’s GDP, a record high.
  
  

• Ozempic-maker Novo Nordisk has reported that the shortage of their blockbuster drugs Ozempic and Wegovy will only get worse for the remainder of the year. Novo Nordisk recommended healthcare professionals limit new prescriptions of their drugs. Meanwhile, Eli Lilly has reported an easing of supply issues with their rival weight loss drugs.
  
  

• Trump Media & Technology Group, the owner of Truth Social, has fallen to a new low. The company reached a high of $79 in late March but is now down to $18. Trump, who owns 59% of the company, is nearing the end of his lockup period where he is not able to sell shares. But come 25 September, Trump will be free to sell part or all of his stake currently worth $2.1 billion.

What the…?

A former senior staffer to two New York Governors, including as the Deputy Chief of Staff to Governor Kathy Hochul has just been arrested for acting as an undercover Chinese agent for 14 years.

Allegations include forging the Governor’s signature on letters to Chinese officials, sharing sensitive documents with Beijing, altering messaging on China-related topics, and blocking Taiwanese officials from speaking to the Governor. In return the staffer was allegedly paid millions of dollars and a Ferrari (surely that raised some eyebrows!?).

Investing is a lifelong journey

Here’s what you can learn today.

This is an excerpt from our podcast interview with Catriona Burns, Lead Portfolio Manager at Wilson Asset Management

Question: Can you talk to us about how you're approaching this AI thematic and some of the different ways to play it?

So we are real believers in AI and like the enormous potential that generative AI has. For example, we've got a big investment in a business called Quanta Services. They do all the maintenance and upgrade work for the electrical and transmission grids in the US. They are the largest player at what they do. The electricity and transmission grids and the communications infrastructure is going to see a lot of pressure, like we haven't seen before. One ChatGPT search is like ten times the electricity demand of a Google search. So you're going to have enormous requirements placed on the grid.

And interestingly, in the global financial crisis, lots of the utilities started outsourcing the maintenance and upgrading of the grids because they needed to cut costs and so forth. And so Quanta became the biggest player in doing that. They signed long term agreements with all the utilities to maintain and upgrade the grid. These guys are doing all the work to upgrade and maintain it. And we think it's an interesting way to play AI that is not not obvious.

Another way to invest in the AI thematic is the data side. The most important thing that's going into AI models is data, and the integrity of the data is the most important thing. So you play companies that have unique data and you play companies in that software layer. A great example would be SAP which who has access to the most insane data. SAP is the backbone of massive corporates all around the world, and they are implementing AI into their own business and into their product suite for their customers. But it's not necessarily a business that you naturally think, ‘oh, that's an AI beneficiary’.

Listen to the full interview on Equity Mates Investing (Apple | Spotify) or watch the full video on YouTube

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