Good Afternoon. It’s National Mac & Cheese Day, and much like your favorite comfort food, markets are trying to stay creamy and smooth despite the tariff heat bubbling underneath. From AI arms races to European arms deals, here’s what’s stirring in the pot today.

—Rosie, Wyatt, Evan & Conor

🔥 What’s Hot: 🔥

🥶 What’s Not: 🥶

1. Bank Earnings Season: Small Lenders Hold the Real Clues

The News: Big banks are dominating the headlines as earnings season starts this week, with Citigroup, JPMorgan Chase, and Wells Fargo all set to report on Tuesday, and Bank of America, Goldman Sachs, and Morgan Stanley on Wednesday. Megabanks have had a blockbuster year so far, the KBW Nasdaq Bank Index, which tracks the largest banks, is up 14% in the second quarter, beating the S&P 500 by 3 percentage points, thanks to strong trading and easier capital requirements.

Why It Matters: While Wall Street cheers the big banks, the real clues about the U.S. economy’s future will come from smaller and regional lenders, who also begin reporting this week. These banks’ lending reports offer a direct read on Main Street business sentiment. Slow loan growth and defensive borrowing by small firms signal caution, so if you’re tracking where jobs, investment, and real economic growth are headed, pay attention to the smaller banks.
Source: wsj.com

2. As Kraft Heinz reportedly weighs split, analysts say more food companies need to break up

The News: Kraft Heinz shares jumped after reports surfaced that the food giant is considering breaking up its business, possibly spinning off much of its grocery segment and separating brands like Kraft from sauces and spreads. Analysts at TD Cowen say the move highlights how megamergers like the 2015 Kraft-Heinz tie-up have often failed to deliver, arguing that food companies focused on specific products or categories tend to outperform sprawling conglomerates. Analysts suggest more food giants, from PepsiCo to Campbell’s, could unlock value by splitting up rather than bulking up through mergers.

Why It Matters: If you’re a fan of big brands or watch the grocery aisle, this could mean major shakeups are coming to your favorite products—and possibly your portfolio. The pressure to break up is a sign that one-size-fits-all strategies are losing flavor in today’s health-conscious, post-pandemic food market. A wave of breakups could unleash new competition, boost innovation, and change what ends up in your cart, while investors watch to see if focused brands really do serve up better returns than bloated food empires.
Source: marketwatch.com

3. PE-Backed McGraw Hill, NIQ Global Intelligence Unveil IPO Terms

The News: Education giant McGraw Hill and consumer data firm NIQ Global Intelligence have set the terms for their upcoming IPOs, aiming for market caps of roughly $4.2 billion and $7 billion, respectively. Both private equity–backed companies plan to debut on the NYSE, with McGraw Hill offering nearly 24.4 million shares at $19–$22 each, and NIQ planning a 50 million share sale at $20–$24 a share. If priced at the high end, these deals would mark two of the largest private equity IPOs of 2025, as McGraw Hill and NIQ join a fresh wave of PE-backed companies hitting the public markets.

Why It Matters: If you track IPOs, private equity, or just want to know where the market’s heading, these listings signal a revival in big-ticket public offerings and could unlock billions for investors. For McGraw Hill and NIQ, going public means a chance to pay down debt and invest in growth but it also puts a spotlight on whether PE-backed firms can deliver long-term value outside the private market bubble. Their success (or flop) could set the tone for dozens of other PE-owned companies waiting in the wings, and may offer fresh opportunities (or caution flags) for anyone betting on the next IPO wave.
Source: wsj.com

4. 'Crypto Week' pushes bitcoin to record high as lawmakers weigh 3 key bills in DC

The News: Bitcoin smashed through a new all-time high above $121,000 as “Crypto Week” kicked off in Congress, where lawmakers are set to vote on three major digital asset bills: the GENIUS Act (establishing the first federal stablecoin framework), the CLARITY Act (dividing crypto oversight between the SEC and CFTC), and the Anti-CBDC Surveillance State Act (banning a U.S. central bank digital currency). The legislative action fueled surges in crypto-linked stocks like Coinbase, Robinhood, and Circle, with Circle’s shares soaring over 500% since its June IPO.

Why It Matters: If you’re a crypto investor or just tracking financial disruption, this is a historic moment. The new laws could bring long-awaited clarity and stricter rules to the crypto industry, unlocking more institutional adoption but also crimping the wild west vibe. Bitcoin’s rally reflects both optimism over friendlier rules and nerves about what Washington might cook up next. For investors, the outcomes could shape how and where digital assets fit into the broader economy and your portfolio.
Source: finance.yahoo.com

5. Pentagon awards $200M AI contracts to Google, OpenAI, others

The News: The Pentagon just awarded contracts worth up to $200 million each to Google, OpenAI, Anthropic, and Elon Musk’s xAI to supercharge the Defense Department’s use of AI for national security. These deals will fund “agentic AI workflows” for everything from warfighting to admin tasks, with each tech giant competing for projects under the military’s new commercial AI push. The announcement comes as xAI launches its “Grok for Government” suite, aiming to grab a bigger slice of the federal market.

Why It Matters: This marks a major milestone in the government’s AI arms race—and a big win for the tech sector. For investors, it’s a signal that AI will play a bigger role in military and federal contracts, potentially fueling more innovation (and controversy) around defense tech. For everyone else, the pace of AI adoption in national security is accelerating, raising fresh questions about ethics, oversight, and the growing overlap between Silicon Valley and the Pentagon.
Source: defenseone.com

1. Trump to supply missiles to Ukraine, gives Russia 50-day ultimatum

The News: President Trump announced a dramatic policy reversal, authorizing the U.S. to supply NATO allies with $10 billion in advanced weaponry, including missiles and air defense systems, which those allies will send to Ukraine. Trump also issued Russia a 50-day deadline to reach a ceasefire, warning of 100% "secondary tariffs" on countries like China and India that continue buying Russian oil.

Why It Matters: If you’re watching global security or energy markets, this marks a seismic shift in U.S. policy and a new level of pressure on Moscow. The move could flood Ukraine with powerful new weapons, ratchet up the war’s stakes, and send oil prices soaring if secondary tariffs bite. For investors and anyone filling up their gas tank, expect volatility as the world waits to see if Russia blinks or if global trade tensions reach a new boiling point.
Source: axios.com

2. European fusion startups raise record €290M in early 2025

The News: European fusion energy startups have already raised a record €290 million in the first half of 2025, as investors double down on the race for clean power. Munich-based Proxima Fusion led the charge with a €130 million Series A, the largest ever for European fusion.

Why It Matters: If you’re tracking the future of energy or just tired of fossil fuel headlines, Europe’s fusion boom could change the game. With new breakthroughs and major cash flowing in, the continent is positioning itself as a leader in commercial fusion, potentially transforming global energy, climate goals, and even who calls the shots in the next energy era.
Source: thenextweb.com

3. Alibaba-backed Moonshot releases new Kimi AI model that beats ChatGPT, Claude in coding — and it costs less

The News: Alibaba-backed Moonshot just unveiled Kimi K2, a low-cost, open-source AI model that outperforms OpenAI’s GPT-4.1 and Anthropic’s Claude Opus 4 on coding tasks at a fraction of the price. Unlike its U.S. rivals, Kimi K2 is free for most users and dramatically undercuts industry leaders on token pricing, shaking up the global AI race.

Why It Matters: If you care about affordable AI or follow the U.S.–China tech battle, Kimi K2 could be a game-changer. The model’s breakthrough performance and open-source approach could force U.S. giants to rethink their pricing and their grip on the AI market, while accelerating global access to advanced generative AI tools, especially for developers and businesses outside the U.S.
Source: cnbc.com

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