Good Morning! The Magnificent 7 shed a collective $700 billion in market cap yesterday, contributing to a market-wide loss of over $6 trillion. M&M maker Mars is in talks for a mega-merger to buy snacking giant Kellanova. Wall Street is reeling from a major market correction, and investors aren’t sure if Wall Street will still support heavy AI spending. A ruling found that Google broke the law to maintain an online search monopoly. Plus a vendetta is rocking Zero Bond owner’s East Hampton restaurant.

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_{SQUEEZ OF THE DAY}

Feeling Like ‘87

Monday saw the S&P 500's largest daily percentage loss (2.9%) in two years and its steepest three-day correction since the pandemic crash of 2020. This market turmoil is driven by a combination of economic concerns, investor fears, and geopolitical tensions.

One major worry is that the Federal Reserve may have delayed rate cuts for too long, especially after the weak jobs report in July. This has led investors to anticipate both lower rates and a slowing economy.

Warren Buffett's decision to sell half of his Apple stake has also fueled anxiety. As one of Wall Street's most influential figures, Buffett's move suggests he believes stocks are overvalued.

Earnings reports have been disappointing, with only 59% of companies beating top Q2 revenue estimates. Geopolitical concerns also remain high, adding to the market's instability.

It's not just the U.S. markets in turmoil—Japanese stocks experienced their worst day since 1987, with the yen hitting a seven-month high against the U.S. dollar, triggering a global stock selloff.

The rapid unwinding of the "yen carry trade" is causing significant volatility. Investors, who previously borrowed cheap yen to invest in higher-yielding assets like U.S. stocks and bonds, are now retreating as the yen's value rises and Japan's central bank raises rates. Contagion is currently a major concern among investors.

Some are drawing comparisons to Black Monday in October 1987 when the S&P 500 plummeted over 20% in a single day. Despite the panic then, the economy remained stable, and the market recovered within two years. Many investors hope for a similar outcome now—the economy seems sound, and the market might just be undergoing a correction.

Takeaway: If this situation feels familiar, it's understandable. Last year's collapse of Silicon Valley Bank was partly due to bets on low U.S. interest rates. While those fears spread, they didn't lead to a prolonged selloff. As the yen carry trade unwinds, there's still optimism that the market will rebound and recover its losses soon.

_{PRESENTED BY 10 EAST}

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_HEADLINES

Top Reads

• Nvidia tanks as 'Mag 7' shed over $700B (YF)

• $6.4T stock wipeout has traders fearing ‘Great Unwind’ is just starting (BB)

• Mars reportedly in talks to buy snacking giant Kellanova (Axios)

• Here are all the reasons why a major market wreck is happening (CNBC)

• Will Wall Street support heavy AI spending? (YF)

• Google loses antitrust case over search (Reuters)

• The ‘vendetta’ rocking Zero Bond owner’s East Hampton restaurant (NYP)

• Wall Street hits the locker room (Prospect)

• How little $1,500 in rent can get in NYC (NYP)

• JPMorgan CEO Jamie Dimon opines on next US president (YF)

• Jeff Bezos' family office is making big investments in AI (CNBC)

_{CAPITAL PULSE}

Markets Rundown

Stocks closed lower on Monday as selloff puts S&P on brink of correction.

Movers & Shakers

• (+) Kellanova ($K) +16% after takeover talks by candy maker Mars.

• (–) Apple ($AAPL) -5% after Warren Buffett disclosed he sold half of his stake.

• (–) Robinhood ($HOOD) -8% because of the global crypto meltdown.

Private Dealmaking

• Quantum Capital bought Cogentrix Energy, a natural gas power plant operator, for $3 billion

• Apax Partners bought Thoughtworks, a tech consultancy, for $1.75 billion

• CVC Capital Partners bought the Therakos business of Mallinckrodt for $925 million

• Carlsberg bought its India and Nepal businesses for $744 million

• Groq, an AI chipmaker, raised $640 million

• Moonshot, a generative AI startup, raised $300 million

For more PE, VC & M&A deals, subscribe to our Buysiders newsletter.

_{BOOK OF THE DAY}

The Man Who Saw Seconds

Preble Jefferson can see five seconds into the future.

Otherwise, he lives an ordinary life. But when a confrontation with a cop on a New York City subway goes tragically wrong, those seconds give Preble the chance to dodge a bullet—causing another man to die in his place.

Government agencies become aware of Preble’s gift, a manhunt ensues, and their ambitions shift from law enforcement to military. Preble will do whatever it takes to protect his family, but as events spiral out of control, he must weigh the cost of his gift against the loss of his humanity.

A breathless thriller that will keep you on the edge of your seat until the very last page, The Man Who Saw Seconds explores the nature of time, the brain as a prediction machine, and the tension between the individual and the systems we create. Alexander Boldizar provides an adrenaline-pumping read that will leave you contemplating love, fear and the abyss.

“A lot of smart people can’t write fiction—too smart, too self-absorbed. But Boldizar is one of our happy exceptions. This book is a blast.”

_{DAILY VISUAL}

A US Industrial Renaissance Has Started

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_{DAILY ACUMEN}

Simplicity

In a complex world, simplicity has power.

It brings clarity, reduces stress, and increases focus.

Leonardo da Vinci said, "Simplicity is the ultimate sophistication."

Where in your life could you simplify?

Think of Apple's clean designs, or Einstein's E=mc².

Great ideas are often simple at their core.

Declutter your space.

Simplify your schedule.

Focus on what truly matters.

Remember, the ability to simplify means to eliminate the unnecessary so that the necessary may speak.

_{ENLIGHTENMENT}

Short Squeez Picks

• If you always do these 8 things, you’re mentally stronger than both

• The power of your personal strengths

• 10 states with the poorest quality of life

• Why leaders don’t care about employee engagement

• 10 non-fiction books to boost intelligence

_{MEME-A-PALOOZA}

Memes of the Day