Treasury Yields Ease, Stocks Move Higher

0:00Welcome to Risk Reversals Market Matrix, your AI-generated podcast, curated by Guy Adami and Dan Nathan, breaking down the day's most impactful stock market and business headlines. I'm your host, Brunson, and all of today's market data is provided by FACSAT, it's Wednesday, September 2nd, and these are your top stories. After several sessions where higher oil and rates dominated the narrative, today's action showed there is still appetite for stocks when those headwinds stop getting worse. Stocks rose on Wednesday as US Treasury yields took a breather from the recent run-up that sent them to multi-year highs. Stocks have been pressured lately by elevated bond yields as traders worried about the impact of rising oil prices on inflation. The S&P 500, as well as the tech-heavy NASDAQ and 30 stock Dow, are currently on track to snap a three-day losing streak. Next, some of the latest news on the AI front. NVIDIA and CrowdStrike are addressing what they see as one of cybersecurity's biggest gaps. The need for cyber defenders to harness AI at the same velocity of cyber attackers.

1:04As reported by the journal, Frontier AI models are discovering bugs at machine speed. Raising alarm that autonomous hacking models will begin to go rogue. On Tuesday, NVIDIA and CrowdStrike introduced a new family of agentic AI models, dubbed SafeMind, which can both find attack paths and close them for customers. The models are available in CrowdStrike's flagship Falcon platform and through its API. According to reporting from Baren's, NVIDIA-backed anthropic signed a $35 billion cloud computing agreement with cloud provider Lambda, further illustrating the intricate web of financing at the center of the artificial intelligence ecosystem. While NVIDIA executives reject the label of circular financing, Baren's notes that the chip maker's extensive balance sheet support and multi-billion dollar third-party lease commitments highlight its central role in bankrolling the very infrastructure used by its key customers. Investor-ferver for the AI boom is so strong that companies are able to borrow billions of dollars right now, essentially for free.

2:06The record surge in zero coupon convertible bonds, which don't pay regular interest, is surprising, given that we're in a higher rate environment. As noted by Axios, typically, that would mean companies would pay higher borrowing costs. OpenAI said its advertising business has hit $1 billion in annualized revenue run rate. The AI company is touting its diversified business model, as it gears up for what is expected to be a massive IPO. The information notes that OpenAI began testing ads in the US earlier this year, drawing the iron of its chief rival, anthropic, in the form of a super bowl commercial. OpenAI said Monday that its ads are clearly label and do not influence chat GPT's answers. OpenAI also says that advertisers do not have access to users' private conversations. Berkshire Hathaway's chief executive Greg Abel said, Wednesday the company sees opportunities for its energy business from the expansion of AI data centers. Following the conglomerates $10 billion additional investment in Alphabet three months ago.

3:08This is reported by the journal Warren Buffett authorizes the new investment in Google's parent company, which has become Berkshire's third largest common stockholding. Abel has described Google as a significant player in AI, which influenced the investment decision. For tomorrow, ISM services alongside several Fed speakers throughout the day. Plus, earnings from Z-scaler and Lulu Lemon, among multiple reports after the close. All of that serves as a lead-in to Friday's non-farm payrolls report, where thus far, traders are not pricing in a ton of potential volatility. That's your risk reversal market matrix. Be sure to follow us to get alerts on new episodes every day. All of the articles mentioned on today's podcast can be found in the show description. For Guy Adamie and Dan Nathan's market analysis on these topics and more, watch market call on RiskRversals YouTube channel Monday through Thursday. All thanks to our data provider FACSET for supporting our coverage. Story Curation by RiskRversal. Scripts by AI.

4:09Voice by 11 Labs. I'm Brunson. Thanks for listening.