The Rundown - Apple Spooks Google with AI Search Claims, Nvidia Scores Big Win from Trump Administration

Episode Date: May 8, 2025

Stock market update for May 8, 2025.This video is for informational purposes only and reflects the views of the host and guest, not Public Holdings or its subsidiaries. Mentions of assets are not recommendations. Investing involves risk, including loss. Past performance does not guarantee future results. For full disclosures, visit ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Public.com/disclosures⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠.

Public.com presents the rundown. Your daily market update in under 10 minutes. My name is Zad Admani, and today is Thursday, May 8th. In today's episode, we recap yesterday's Fed meeting and why it was kind of boring. We also discussed why comments from an Apple executive tanked Google stock that we break down Trump's latest AI chip policy that has Nvidia breathing a sigh of relief. Then stick around to the end of the show to find out about the latest AI funeral. app being launched by NBA player Russell Westbrook.

We got a great show for you today. Let's go. There was so much going on yesterday that the markets were having a hard time figuring out what to do. Ultimately, stocks did finish Wednesday in the green with the S&P 500 up 0.4% and the NASDAQ adding 0.3%. The big headline yesterday was, of course, the Fed meeting. We've been hyping it up all week. And as expected, the Fed did not cut interest rates.

They are keeping the Fed funds rate between 4.25 and 4.5%. And look, I know that I was hyping up Jerome Powell's press conference, but honestly, it was kind of a snooze fest. He was pretty much saying the same thing for every question, that the Fed is in a wait-and-see mode right now, and he didn't give any indication or hints or winks of when the Fed's next rate cut was going to come. He had a pretty hawkish tone. Jerome Powell pointed to the hard data, which is showing the economy is still in pretty solid shape, despite everyone freaking out about tariffs. The data is showing no signs of major layoffs

or a slowdown in consumer spending. In fact, we got consumer spending data this morning and it was up 0.7% for the month of April. So yeah, the Fed seems to be no rush to cut interest rates. No surprise here, but President Trump, not a fan of Jerome Powell's decision. You know, he's been pushing Jerome Powell to cut interest rates for weeks now. This morning, Trump posted on truth social calling Jerome Powell a fool,

which might be a slight upgrade from being called a loser, she did last month. Maybe Trump was in an overall good mood because he's planning to hold a press conference at the Oval Office this morning with the UK to unveil a trade deal. So we might finally have an official trade deal signed today. We're going to keep an eye on that press conference for you guys and break it down on tomorrow's show. By the way, I thought this podcast was going to hit 5,000 5 star ratings before any major trade deals were announced. But it looks like we're going to fall just a little bit short. We have around 4,800 five star ratings on Spotify. So we just missed it. But Maybe we can get to 5,000 before a major trade deal with China as announced.

Honestly, I'd be good with either one, but it would be kind of nice to hit the 5,000 mark. I mean, Treasury Secretary Scott Besson is going to Switzerland this weekend to negotiate with Chinese trade officials. So we might not have a lot of time, but we need like 200 people to tap that five-star rating on Spotify to put us over the top. Let's run through some headlines. Starting with Google. Google stock got rocked yesterday after a bomb-shunded. revelation from an Apple executive. Apple services executive Eddie Q was testifying in the DOJ's

anti-trust trial against Google yesterday, and he said that search volumes on the Safari web browser dropped for the first time ever in the month of April. Now, if that wasn't bad enough, Apple also hinted at potentially replacing Google with an AI-powered search engine on Safari. He specifically named-dropped OpenAI, Perplexity, and Anthropic as potential replacements. And this sent a shot wave across the markets because Google has been the default search engine on the iPhone since the very beginning going all the way back to 2007. And it's been a pretty great deal for Apple too since Google pays them around $20 billion a year to be the default search engine, which is kind of wild.

Like Apple collects a $20 billion check for literally doing nothing. That money accounts for more than 20% of their overall profits in a single year. So obviously Apple doesn't want this partnership to end with Google, but they might not have a choice because the government might force it to end as a consequence of Google losing their antitrust case against the DOJ. In fact, Apple's Eddie Hughes said that losing the $20 billion check from Google keeps him up at night and I'd get it because I probably would never sleep if my $20 billion income stream was threatened. But you know, the bigger picture here is that Apple is admitting they're seeing less search volumes and it's yet another sign that AI tools like

chat GPT, perplexity and Claude might be eating into Google's dominance. And if Apple ultimately does move to an AI search engine and rolls it across their 2 billion active iPhones, it could be the beginning of the end of Google's search, which is a $200 billion a year business. So Apple is kind of freaking out about this. Google is trying to play it cool, but investors are full-on panicking. Google stock dropped more than 7% yesterday. It's the worst day they've had in over two years, and the company lost more than $130 billion in market cap in the process. I mean, this could be an overreaction because Google's latest earnings report showed the search business continues to grow double digits. But man, the markets are not optimistic about Google's future

right now. Sticking with the AI theme, let's talk about AI chip exports. The Trump administration says they're planning to scrap Biden's AI chip export restrictions, which were set to go into effect next week. These restrictions were called the AI diffusion rule. And the way it worked is that it split the world into three tiers. You had tier one, which included 17 countries like the UK and Taiwan, they would be allowed to import as many AI chips as they wanted. Then you had Tier 2, which is the majority of the world. There was 120 countries in this tier, and they were going to be subject to a cap on AI chip imports. And then you had Tier 3. These countries would be fully restricted from buying AI chips from the U.S. This includes countries like China, Russia, and North

Korea. And the goal of this rule was to keep the cutting edge AI chips out of China's hands. But the downside was it blocked other countries like rich Middle Eastern countries from buying US chips. And that's why big tech giants like Nvidia, Microsoft, and Oracle were not a fan of this rule. They said that it would ultimately hurt business and friendly countries without actually stopping China from getting their hands on the latest chips. So now the Trump administration is planning to kill this diffusion rule and instead do a one-on-one trade deal with each country's regarding AI chips. Now, it's also worth noting the Trump administration is not going soft on China. In fact, they recently banned Nvidia from selling their H-20 chips there, which is going to cause the company to

take a $5.5 billion revenue hit. And the Trump team is also planning to crack down on countries like Singapore, Malaysia, and Thailand that might be rerouting chips to China. But overall, this is a big policy shift when it comes to AI, and it's a huge win, especially for InVidia. Let's talk about some stocks making moves today. App Lovin stock is surging this morning after the ad tech slash gaming company dropped a strong earnings report. The company said their ad revenue jumped 70, 1% last quarter. Apparently, AI has been a really big boost for their ad business. In fact, the company is doubling down on being an AI company by selling off their entire mobile gaming division to Triple Dot Studios for $400 million. They're also going to get a 20% equity stake in

Triple Dot as well. But yeah, App Lovin is basically pivoting from a gaming company to an AI ad machine now. And investors are loving it. Shares of App Lovin are up nearly 15% at the time of this recording. On the flip side, Shopify not doing so good this morning. their stock is down after the company missed on Q1 earnings and gave a weak gross profit forecast for Q2. And to be fair, revenue was solid. It grew by 27%, which beat Wall Street estimates, but investors seem to be more concerned about profit margins moving forward. As a result, Shopify stock is down around 3% this morning in reaction to these earnings. Let's wrap the show with a fun fact. NBA star Russell Westbrook is launching an AI-powered funeral app. I had to do a

double take when I saw this headline, but no, this is legit. The startup is going to be called Easewell. It's basically going to be a digital concierge for end-of-life planning. It'll help people book services, negotiate with funeral homes, and handle all the admin stuff that nobody really wants to deal with. And Russ is actually co-founding this app with fellow NBA All-Star Kemba Walker. Honestly, I think it's a pretty solid idea for an app, excited to see what Russell Westbrook does with it. And maybe the Boston Celtics should consider using this app, because it looks like they might be choking right now, and their season is on the verge of death. Shout to my Knicks fans, man.

Well, all right, guys, that's the rundown for today. There is a lot going on right now. Trump is holding a press conference with UK officials to talk about a trade deal. There's more earnings coming out. We might have more trade deals announced soon. So we're staying busy out here, recapping everything for you. So make sure you guys are subscribed to the podcast if you haven't already. And again, consider giving us a five-star rating so we can get to 5,000 five-star ratings on Spotify.

And while you're there, don't forget the voting today's Spotify poll. Leave us a comment on Spotify. 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 tomorrow.