Tariff Wars Redux

Tariff Wars Redux 

China on Tuesday warned US President Donald Trump against reigniting trade tensions by reinstating tariffs in August. Beijing also threatened to retaliate against countries that exclude China from supply chains. Despite a June truce setting US tariffs on Chinese imports at 55% and Chinese tariffs on US imports at 10%, President Trump has issued new tariffs for over a dozen countries, risking renewed economic friction, Seeking Alphaoutlined.

Quantum Leader Raises $1bn

In the largest-ever single institutional investment in the common stock of a quantum computing company, IonQ [IONQ] raised $1bn from Heights Capital, an affiliate of Susquehanna, by selling 18 million shares and pre-funded warrants at $55.49, 25% above Thursday’s close. The deal includes seven-year warrants for 36 million more shares at $99.88, potentially adding $3.6bn, Bloomberg reported. 

Samsung Sees Major Profit Drop in Q2

Samsung Electronics [SSNLF] forecast a 56% drop in Q2 operating profit to ₩4.6trn, its worst showing in six quarters, as US chip export restrictions to China and sluggish artificial intelligence (AI) chip sales weighed on performance. Revenue is expected to remain flat at ₩74trn, missing estimates. Shares traded flat on the KOSPI despite the disappointing preliminary results.

CoreWeave Neutralizes Rival

CoreWeave [CRWV] is acquiring top competitor Core Scientific [CORZ] in a $9bn all-stock deal that will eliminate $10bn in long-term lease obligations. The move follows CoreWeave’s earlier leasing of Core Scientific’s data centers to meet AI demand. Core Scientific shareholders will own under 10% of the combined entity. Read OPTO’s recent deep dive into CoreWeave and its blistering rally.

Stategy: Crypto Powerhouse

Michael Saylor’s Strategy [MSTR] reported a $14.05bn unrealized gain in Q2 from its bitcoin holdings, offset by a $4.04bn deferred tax expense. Now holding $65bn in bitcoin, it paused purchases for the first time since April. The company also launched another preferred stock sale to help fund $6.8bn in Q2 acquisitions, continuing its aggressive crypto accumulation strategy, according to Bloomberg.

Switzerland Approves Novartis Malaria Drug

Novartis [NVS] has secured Swiss approval for Coartem, the world’s first malaria drug specifically for newborns under 4.5kg, a group previously treated with riskier formulations for older children. The approval addresses a major treatment gap, with eight African nations expected to follow, the Financial Times reported. Malaria killed nearly 600,000 people in 2023, mostly children under five in sub-Saharan Africa.

Small-cap US Chip Stocks to Watch

The US semiconductor industry is facing major setbacks. Several smaller firms may be agile enough to survive, and some may even thrive. Among them are Photronics [PLAB], which manufactures high-precision stencils, and ACM Research [ACMR], which develops wet-cleaning and processing tools. OPTO unpacks the investment case for each, as well as wondering whether beleaguered Wolfspeed [WOLF] is worth keeping an eye on.