The Rundown - AMD Bets on AI Drug Discovery, Quantum Computing Stocks Tumble

Episode Date: January 8, 2025

Stock market update for January 8, 2025.

Public.com presents the rundown. Your daily market update in five minutes. My name is Zad Admani, and today is Wednesday, January 8th. In today's episode, we tell you why the bond market might be bringing down stocks and crypto. We also tell you about the AI wars heating up as Anthropic raises billions of dollars. Then stick around to the end of the show to find out why quantum stocks are tanking and the secret to Chick-fil-A's incredible lemonade. All right.

Let's go. The markets got rocked on Tuesday. The S&P dropped 1.1% and the NASDAQ was down 1.9%. One of the biggest losers yesterday was NVIDIA. One day after setting all-time highs, the stock gave back 6%. And it might have been my fault because I was hyping up NVIDIA big time on yesterday's episode, talking about how they were on the verge of taking back the crown from Apple to become the largest company in the world again. And I might have just pulled a Jim Kramer and jinxed it.

So yeah, my bad, everybody. But, you know, it wasn't just Nvidia having a bad day. Every stock in the Magnificenton 7 was in the red, along with other popular stocks like Broadcom, Pallantier. Even Bitcoin took a big dip yesterday going from $100,000 down to $95,000. So yeah, pretty brutal sell-off, and one reason for that could be the rising treasury yields. Now, we don't really talk much about treasury yields on this show

because it's pretty boring stuff. But yields have been surging, and that's having an impact on the stock market. See, when treasury yields rise, investors tend to pull money out of the stock market to buy treasury bonds to take advantage of the higher yields. The thinking being why take a risk in the stock market when you can get more than four and a half percent investing in treasury bonds. Hopefully that makes sense. So if yields continue to rise, that could put more downward pressure on the stock market. On a related note, you can actually

invest in U.S. Treasuries on the public app. So if you want to take advantage of these higher rates, go check out the public app. So yeah, even though it's pretty boring stuff, we'll have to keep an eye on the bond market and the treasury yields to see what they do. Now remember, the stock market will be closed tomorrow in honor of Jimmy Carter's passing. So no show for us tomorrow, but we'll be back on Friday to recap the week. And Friday's show is going to be a banger. I'm already telling you, because we're going to get the jobs report on Friday morning. We're getting a couple earnings reports on Friday morning. So make sure you guys don't miss Friday morning's episode because it should be a good one. Let's run through some headlines. AMD is making a big bet on drug discovery.

AMD announced today they're investing $20 million into a drug discovery company called Apsi? Hang on, let me look up how to pronounce this. Okay, according to their YouTube channel, it's pronounced ABSI. And honestly, the trailered on their YouTube channel talking about their company was pretty fire. So maybe that's why AMD invested money into them. Absi is a company that uses generative AI for drug development, which sounds pretty cool, not going to lie. In fact, their tagline is creating drugs at the speed of AI. That has a nice ring to it.

And this investment by AMD seems to be a move to sell their AI chips to health care companies. Now, as part of this investment, Ab-Sai will start using AMD's AI chips, which should help them save on hardware costs. AI has become important in the world of drug discovery as computers analyze various data sets to help create potential life-saving drugs. Honestly, it's pretty encouraging stuff and a great use case for AI. Now, AMD's not the only tech company making moves in the life-signed space. In fact, Nvidia actually invested $50 million in a drug discovery company recursion pharmaceuticals back in 2023. So I think Nvidia and AMD are trying to corner this market, and they want to be the one that supply the chips

of these up-and-coming AI life science companies. I think it's a good move by AMD. Markets weren't as impressed. AMD stock is actually down around 2% this morning, but app-sized shares are up around 27% in reaction to this news. AMB kind of needs to bounce back this year because their 2024 was low-key disappointing, especially when you compare it to Nvidia.

Now, sticking with the AI theme, Anthropic, the company behind the Claude Chatbox, is raising $2 billion per the $1,000. Wall Street Journal. This would value the AI company at $60 billion, which is like triple what their valuation was last year. And we mentioned on yesterday's show that AI companies raised a record $90 billion last year. And that's not slowing down so far. These AI companies are just filling up their war chest to get ready for year three of the AI wars. Open AI raised $6 billion a few months ago. XAI raised $6 billion. Perplexity has raised nearly a billion dollars. They're all on the

race for AI domination. And I didn't even include the big tech players like Google, meta, Amazon and Microsoft, they're all planning to invest billions of dollars into AI as well. And yes, I excluded Apple on that list on purpose because I've used Apple Intelligence. Okay, they're not an AI company, all right? But yeah, we're entering year three of the AI hype cycle, and it doesn't look like things are slowing down. I do wonder what's going to happen to Anthropic, because I feel like they're the most unknown company to the general audience, at least.

It was founded by former Open AI employees back in 2021, and their Claude Chatbox is pretty great. In fact, some hardcore AI people I know say that Claude is better. than chat GPT. But it doesn't have the same brand recognition that chat GPT does. Like non-tech people know what chat GPT is, right? So it's going to be interesting to see how Claude overcomes that because chat GPT has a big lead when it comes to brand awareness. I wonder if there's a chance that Anthropic gets acquired over the next 12 months.

Just putting it out there. Let's talk about some stocks making moves today. eBay stock is jumping this morning after the e-commerce company announced a deal with meta to plug their listings on Facebook market. I'm not happy to hear that news. Meta will advertise eBay deals within Facebook Marketplace and will direct you to eBay site for final purchase. Now, this partnership will be tested in the U.S., Germany, and France before a wider rollout. Again, I personally don't like this.

I just want my Facebook Marketplace to be local area items. But eBay investors like this news, shares of eBay are up more than 6% this morning. On the flip side, shares of Flutter Entertainment, which is Fanduels parent company, are down after the sports book lowered their U.S. revenue guidance and their blitzers. claiming the NFL. The company said that too many favorites won in this past NFL season, and that hurt the company's bottom line. See, fans tend to bet on favorites, so when they win, it means less money for fan duel. The company did point to good results in the English Premier League, and they raised their revenue guidance there, but that wasn't enough for investors, and the stock is down around 2% this morning. For all my footy fans out there, what's going

on with Man City? All right? Because I've been out of the loop this season, and I'm looking at the table and Man City's just not doing great. What's going on? By the way, quantum stocks are Also tanking this morning after an NVIDIA CEO Jensen Huang said that practical use for quantum technology is likely two decades away. This comment was so brutal that I sent shares of high-flying quantum stocks like Raghetti and D-Wave down more than 25% this morning. But to be fair, all those quantum computing stocks had more than tripled in 2024. So if you got an early, you're probably still doing fine.

Let's wrap the show with a fun fact. Chick-fil-A has a lemon-squeezing robot factory that saves 10. 10,000 hours of work a day. Chick-fil-A is known for their chicken sandwiches, but to me, their lemonade is probably the best thing they have. Well, apparently, those lemons are being squeezed by robots in L.A. Back in 2020, Chick-fil-A. Opened a fully autonomous factory in L.A.

With driverless forklifts and lemons-squeezing robots that squeezes 2,000 lemons a day, and they ship that juice to Chick-fil-A locations across the country. See, before, lemons used to be squeezed on location, and that caused many injuries to fingers. But now the robots do it, which prevents those injuries, and it also saves 10,000 hours a day of work across all those locations. So those employees can focus on other stuff. So yeah, fast food companies continue

to embrace automation. You know, Chipotle has a robot that slices avocados. McDonald's and Wendy's working on AI drive-thrus. It's happening. Robots are coming for fast food. But hey, at least Chick-fil-A's lemonade is still goaded, even if the robot makes it. Well, all right, guys, that's the rundown for today. Hope you guys enjoyed today's episode. Remember, the stock market will be closed tomorrow, so no show for us. We'll be back on Friday to recap, the week. If you guys enjoyed today's episode, consider giving us a five-star rating on Apple, on Spotify, vote in today's Spotify poll, leave us a comment on Spotify, follow our Instagram account for clips and bonus content. All that engagement really does help us out, and it helps other people

find the show. Thank you guys so much for listening. Shout out to Mike and Connor for all the help behind the scenes, and we'll see you guys back here on Friday. This is the rundown, your real-time resource for news events and trends in the markets. All views presented in the show reflect the opinions of the guests. You should not take any mention of a publicly traded security as a recommendation to buy, sell or hold that security. Run down guests are not financial advisors and are not affiliated with public holdings or its subsidiaries. You should make your own financial and investment decisions or consult.

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