Good Afternoon. Happy National Chicken Wing Day! Before you start scouting deals at Buffalo Wild Wings, Wingstop, or your local dive, get ready for some extra heat, today’s markets are serving up plenty of spice. Grab a napkin and let’s dig in.

—Rosie, Wyatt, Evan & Conor

🔥 What’s Hot: 🔥

🥶 What’s Not: 🥶

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1. UPS is pivoting from high-volume to high-margin.

The News: UPS is doubling down on profit margins over package volume, slashing 20,000 jobs, closing 73 facilities, and ending its low-margin Amazon partnership as part of a sweeping overhaul. In Q2, the shipping giant’s revenue stayed flat at $21.2 billion, but cost cuts, strong international demand, and higher air cargo pricing kept profits afloat. Domestic revenue dipped as parcel volumes fell, while international business proved a bright spot. Management is pressing forward with efficiency gains, aiming to strip $3.5 billion in costs this year even as it offers no full-year outlook due to economic uncertainty.

Why It Matters: This is the classic "fewer, better customers" playbook, one the airlines know well. Like United and Delta, which are pushing premium seats and lounges for higher-margin travelers, UPS is choosing profits over package piles. By ditching high-volume but low-profit Amazon business, UPS is betting it can keep margins healthy even if Wall Street’s not excited about a slow-growth story. UPS shares were down as much as 10% today. But with e-commerce patterns in flux and the macro picture still murky, the risk is whether UPS can find enough profitable business to fill the gap. Sound familiar, airlines?
Source: qz.com

2. U.S. trade deficit shrinks to lowest level since 2023

The News: The U.S. goods trade deficit fell to $86 billion in June, an 11% drop and the narrowest gap since September 2023, as imports plunged amid ongoing tariff uncertainty under President Trump. Imports dropped 4.2% while exports slipped just 0.6%, with consumer goods leading the decline as companies paused foreign orders to avoid potential new tariffs. The sharp swing follows months of businesses trying to “time” Trump’s evolving trade policy, after the deficit hit a record high in March.

Why It Matters: A shrinking trade deficit is a shot in the arm for U.S. economic growth, likely adding as much as 4 percentage points to second-quarter GDP, according to Matthew Martin, senior U.S. economist at Oxford Economics. As trade tensions cool and companies work through their inventories, economists expect trade’s drag on the economy to ease. But with new negotiations on the horizon, more swings could be ahead. For the moment, though, trade is finally giving GDP a lift instead of weighing it down.
Source: morningstar.com

3. Investors now buy 30% of US homes as rates sideline buyers

The News: With mortgage rates and home prices sky-high, individual buyers have pulled back from the housing market. Stepping into the gap: investors, who now make up a record 30% of single-family home purchases in 2025, up from 20% six years ago. While institutional giants like Blackstone have slowed down, small-scale “mom-and-pop” investors are dominating, fueled by builder discounts, all-cash offers, and the hope of steady rental income. Builders eager to move excess inventory are offering these investors deals that were previously reserved for big firms.

Why It Matters: This investor surge is squeezing out first-time and traditional homebuyers, making affordable homes even harder to find. Smaller investors, often focused on specific neighborhoods, are keeping prices high and reshaping local markets. The trend also intensifies the nation’s rental affordability crisis, with more renters than ever paying unsustainable portions of their income for housing. While investor activity can stabilize prices in weak markets, some analysts warn that heavy investment in housing is fueling speculation and that the growing dominance of non-owner-occupiers could have long-term consequences for both affordability and neighborhood stability.
Source: wsj.com

4. The 3rd Priciest Stock Market in Over 150 Years

The News: The U.S. stock market just hit a major valuation milestone: The S&P 500’s Shiller price-to-earnings (CAPE) ratio has climbed above 38.9, making this officially the third-priciest market in over 150 years of history. Only two other times—just before the dot-com bust in 1999 and the 2022 bear market—has the Shiller P/E been higher, and both were followed by painful market downturns. While the current bull run has seen stocks rebound sharply from an April low, history suggests these “nosebleed” valuations often precede substantial pullbacks, with previous instances leading to declines of 20% to 49% (and even steeper during the Great Depression).

Why It Matters: The record-high Shiller P/E is flashing a clear warning: When stocks get this expensive, rough patches often follow, even if the exact timing is impossible to predict. Still, the data is reassuring for long-term investors, history shows that while market “elevator-down” moments can be swift and brutal, bull markets are far more enduring. In fact, every 20-year period since 1900 has delivered positive returns for S&P 500 investors, even through crashes and recessions. The takeaway: short-term pain is likely, but time remains an undefeated ally for patient investors.
Source: fool.com

5. Union Pacific and Norfolk seek 1st transcontinental railroad

The News: Union Pacific is buying Norfolk Southern for $85 billion, aiming to create America’s first coast-to-coast freight railroad. The deal would link UP’s western routes with Norfolk’s eastern lines, giving the combined company a 50,000-mile network across 43 states and $2.75 billion in expected annual cost savings. The merger faces a long regulatory process, union pushback, and could spark a new wave of railroad mergers as CSX and Berkshire Hathaway’s BNSF scramble to keep up.

Why It Matters: If this deal goes through, Union Pacific will have what every Monopoly player dreams of: all the railroads on the board—minus the tiny plastic hotels. If it goes through, this deal could reshape U.S. freight logistics with more efficient coast-to-coast shipping, but also raise fears about reduced competition, higher prices, and service disruptions. For investors and the public, all eyes are on regulators to see whether the largest rail deal in U.S. history will pass muster or spark a new era of industry transformation.
Source: apnews.com

1. India overtakes China as top smartphone supplier to US

The News: India has overtaken China as the top supplier of smartphones shipped to the US for the first time, capturing 44% of the market in Q2 2025—up from just 13% a year ago—while China’s share plunged from 61% to 25%. The shift comes as Apple and other major brands ramp up manufacturing in India to hedge against escalating US-China trade tensions and potential tariffs.

Why It Matters: This is a seismic shift in global supply chains and a warning shot for China’s manufacturing dominance. As companies scramble to diversify away from China, thanks to tariff threats and geopolitical risks, India has emerged as the biggest beneficiary. Even as supply chains are redrawn and new winners emerge, sluggish consumer demand in the US means all that manufacturing muscle isn’t translating into booming sales, at least not yet. For Apple, Samsung, and the entire tech sector, the real battle may just be starting.
Source: theregister.com

2. Google Search's AI Mode is rolling out in the UK

The News: Google has launched its conversational “AI Mode” search in the UK, powered by Gemini 2.5, marking a major shift away from traditional blue-link search results. Behind the scenes, AI Mode breaks down questions into subtopics and runs multiple searches at once to generate richer responses. While Google touts this as a more intuitive and powerful way to search, UK publishers are raising alarm, citing new Pew and BBC research showing that AI summaries drastically reduce clicks to external websites dropping click-through rates by half, with users only visiting source links in about 1% of AI-driven searches. Google disputes some of the findings but hasn’t clarified how advertising or paid placement will work within AI Mode, leaving publishers and advertisers in limbo.

Why It Matters: For users, AI Mode promises a more natural and helpful search experience handling complex questions, supporting images and voice, and competing directly with chatbots like ChatGPT. However, this innovation threatens the sustainability of online journalism, as publishers fear becoming invisible middlemen with shrinking ad revenues and less traffic. As AI-powered features increasingly keep users inside Google’s walled garden, concerns about the long-term viability of independent content creation and the environmental impact of massive AI infrastructure are mounting. The UK rollout is a pivotal test of whether AI search can balance user convenience with a healthy, diverse digital ecosystem or if it will deepen the crisis for publishers and shift the web’s economics for good.
Source: engadget.com

3. BOHEMIA trial in Kenya showed a 26% reduction in new malaria infections among children aged 5-15

The News: A groundbreaking study published in The New England Journal of Medicine has shown that mass administration of the antiparasitic drug ivermectin can turn human blood into a mosquito-killing weapon, reducing malaria infections by 26% in communities where it’s widely used. The large-scale BOHEMIA trial in Kenya gave over 20,000 participants monthly doses of ivermectin during the rainy season, with children aged 5–15 seeing a notable drop in malaria cases compared to those given a control drug. When mosquitoes bite treated individuals, they ingest ivermectin and die, providing a new line of defense as traditional methods. The study also reported bonus benefits, like drops in bed bugs and skin infestations, and found no severe side effects from the drug.

Why It Matters: As malaria remains a stubborn global threat, with over 263 million cases and nearly 600,000 deaths last year, this approach offers renewed hope, especially where current tools are faltering. Ivermectin’s proven safety and effectiveness against mosquitoes could complement existing interventions, filling critical gaps created by rising insecticide resistance and changing mosquito behavior. Some experts are cautious about the impact size, but the World Health Organization (WHO) has called for further studies and countries are weighing whether to add ivermectin to their malaria control programs. If widely adopted, this could mark a new chapter in the fight against malaria, leading to new growth opportunities for these communities and regions.
Source: sciencedaily.com

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