The Rundown - Trump Says China Violated Preliminary Trade Deal, Meta Teams Up with Anduril on Military Tech

Episode Date: May 30, 2025

Stock market update for May 30, 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 Zadadmani, and today is Friday, May 30th. And today's episode will tell you why tariffs are back and why the taco trade might be starting to backfire. We'll also tell you about meta's plans to become a military contractor and Amazon's plans to build the next generation of AI devices. Then stick around to the end of the show to find out how a breakfast,

meeting in Denny's in San Jose led to the creation of NVIDIA. We got a great show for you today. Let's go. Yesterday was a weird one for the stock market. Things started off pretty hot. Stocks were rallying on the news that a trade court struck down Trump's tariffs. But just like the Minnesota Timberwolves playoff run, that rally didn't last. The S&P and NASDAQ still closed up 0.4%, but that was a big drop from the morning highs.

Now, it probably didn't help that just 17 hours after a federal trade court blocked Trump's tariffs, that an appeals court hit the undo button and reinstated them while the case plays out. So tariffs are now back again. Hopefully some of you guys took advantage of the 17-hour window to import all the things you needed. But like I said on yesterday's show, this legal fight isn't going to end anytime soon. Most legal experts think this one's headed to the Supreme Court where the nine justices will weigh in on whether Trump can actually use the Emergency Powers Act to impose terrorism. tariffs like he has. But what all of this is doing is adding more uncertainty to the markets for

investors to deal with. To add to the trade uncertainty, Treasury Secretary Scott Besson said yesterday that trade talks with China are a bit stalled. And what about China? Specifically China and that obviously started in a different place. How can you characterize those talks now? I would say that they are a bit stalled. And to make matters worse this morning, President Trump hopped on truth social to accuse China of violating their preliminary trade deal. So things aren't going so well right now when it comes to trade. You know, just as the trade tensions were starting to cool off, it looks like things are heating back up again.

I mean, I said it on yesterday's show that I think Trump might have taken the taco trade thing personally, and he might just double down on tariffs now. I mean, in his post on truth social, Trump hinted at not being Mr. Nice Guy anymore. So I'm prepared for some unpredictability over the next few weeks. Now, speaking to President Trump, he also met with Fed chair Jerome Powell yesterday at the White House. This was their first sit-down meeting in Trump's second term. And no surprise here, Trump told Jerome Powell that he's making a mistake by not cutting interest rates. You know, Trump has been talking about that for weeks now, and he told Powell to his face.

Now, Jerome Powell seems to have played it cool. He said the Fed will make interest rate decisions based solely on careful, objective, and non-political analysis. Now, the Fed did get some fresh inflation data this morning. the PC inflation report, which is the Fed's preferred inflation gauge, it showed prices were up by 2.1% in April year over year, which is right in line with expectations and pretty close to the Fed's 2% target. But still, despite this report, the markets aren't expecting the Fed to cut rates anytime soon. According to the CME Fed Watch tool, there is a 95% chance the Fed keeps interest rates unchanged

at the next Fed meeting, which is on June 18th. But that's like three weeks from now. And in this market, a lot can happen in like three hours, let alone three weeks. Let's run through some headlines. Starting with Meta. Meta is teaming up with weapons maker and a role to build a military-grade VR-A-R headset for the U.S. Army. The project is called Eagle Eye, and this thing is wild, all right? It's going to be a high-tech helmet which will use built-in sensors to detect threats like incoming drones

and help soldiers operate AI-powered weapons on the battlefield. It's going to be a mixed reality system, kind of like Iron Man's heads-up display. The helmet is going to integrate with Enderl's lattice platform, which is their AI command and control software that gives real-time battlefield intel. So maybe this is just the first step in building an actual Iron Man. Now, this project builds on meta's investments in reality labs,

their AR and VR headsets, which hasn't really been a consumer hit, so they're hoping that it's going to be a big hit for the military. This deal is also meant to speed up adoption of meta's open source llama models for national security work. And beyond just that, this partnership has a bit of Silicon Valley soap opera to it, because this partnership is the reunion of Palmer Lucky and Mark Zuckerberg. Anderl founder Palmer Lucky was also the founder of Oculus, the virtual reality company that Facebook bought back in 2014 for $2 billion.

So Palmer Lucky used to work at Facebook building out their VR tech. I mean, he basically laid the foundation for meta's VR ambitions. But then he got fired back in 2017 after making a $10,000 donation to a anti-Hillary Clinton pro-Donald Trump campaign. At least that's what Palmer says is the reason he got pushed out. But he doesn't seem to have any beef with Zuck. In fact, he clarified recently that Zuck didn't fire him personally and that most of the meta executives who did want him out have left the company. So yeah, now Palmer Lucky and Mark Zuckerberg are back to working together. only this time they're building out an Ironman headset instead of Beat Saber.

Beat Saber was a great game, though. Now, speaking of games, Amazon might be cooking something up when it comes to games. According to CNBC, Amazon has assembled a team called Zero One, and it's being led by Jay Allard, the co-creator of Xbox. And people are really curious to know what they're working on. Amazon hasn't given us any hints at all. But according to their job postings, the group seems to be working on both software and hardware projects. Amazon does have a gaming division, so maybe they're working on some sort of new gaming console.

But just last week, CNBC reported that Amazon was also exploring building a foldable smartphone. So maybe Jay Allard is working on the potential iPhone killer. I don't know. Whatever it is, Amazon doesn't really have a great track record of building successful consumer tech outside of the Kindle. And no, I'm not going to count the Amazon Alexa puck, okay? So I don't know what the 0-1 team is building at Amazon, but I'm definitely going to be paying attention. And I'm sure investors will as well. Let's talk about some stocks making moves today.

Dell's stock is up this morning after the company posted mixed earnings, but they dropped a monster forecast that had Wall Street fired up. Let's start with the not-so-great-stuff. Dell made less profit than expected in Q1, but the revenues did come in slightly above expectations growing at 5% year-over-year. But here's where investors got excited. Dell raised their full-year earnings outlook, and the company expects to sell $7 billion worth of AI servers in this quarter alone.

That's more than double the previously quarterly record. Management said the demand for its Nvidia-powered systems have been unprecedented. In fact, the company now says they have over $14 billion in backlog for their AI system. So you can see why Wall Street was getting pretty excited, and Dell stock is up more than 2% today in reaction to these earnings. Never mind. Five minutes after I recorded that section, Dell stock is now down like 1%. So maybe investors aren't so excited about the earnings forecast after all.

Gap stock is gaping down this morning despite the retailer posting solid Q1 numbers. Both revenue and earnings beat estimates for Q1, but the company is expecting lower sales and profits moving forward thanks to the impact of tariffs. The company warned that tariffs could cost them between $100 to $150 million this year if they remain in effect. Now, the company is trying to pivot by diversifying their supply chains and slashing their exposure to China. The company said that less than 3% of their products will come from China by the end of the year.

They're also planning to buy more cotton from the U.S. to soften the impact of tariffs. But investors are still freaking out and Gap stock is down more than 14% this morning in reaction to the earnings. You know, up until this earnings report, the company was having a great year. Their stock was up nearly 20%. Let's wrap the show with a fun fact. InVitya was literally founded at a Denny's. Back in 1993, Jensen Huang and his co-founder sat down at a Denny's in San Jose. They ordered some pancakes and they sketched out their vision for a new kind of chip company on a napkin.

It's like straight out of a movie. Their goal was to make chips so powerful that they'd make their competitors jealous, which is why they called the company Nvidia. It's a Latin word that means envy. You fast forward 30 years and Nvidia might be the most important company on the planet right now. If you guys want to learn more about Nvidia and how a Denny's napkin sketch turned into a multi-trillion dollar company and the backbone of the AI economy, then keep an eye out for our deep dive episode coming out this weekend.

In fact, just turn on the notification so you're notified as soon as the episode goes up. I'm just going to put this out there. I think if enough people listen to this episode, maybe we can get Jensen on for part two. Well, that might be a little ambitious, but shoot my shot, you know? Well, all right, guys, that's the rundown for today. That's the rundown for this week. I know this week only had four trading days, but it felt like it had eight. I mean, there was so much going on with the Taco Trade and the Nvidia earnings and the tariffs being paused and now Trump's playing hardball with China again.

We might be in for a wild ride over the next few weeks. By the way, if you guys enjoy listening to our show and have like 12 extra seconds, consider giving us a five-star rating on Apple or Spotify. And if you're listening on Spotify, don't forget to vote in today's Spotify poll. Leave us a comment on Spotify. All that engagement. 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 this weekend for the deep dive.