Weekly Research Briefing: Fireworks

Oracle Corp. said it has signed a single cloud deal worth $30 billion in annual revenue — more than the current size of its entire cloud infrastructure business.

That revenue is expected to start flowing in the fiscal year 2028, Oracle disclosed in a regulatory filing Monday, without naming the customer.

“Oracle is off to a strong start” in its fiscal year 2026, Chief Executive Officer Safra Catz said in the filing. The company has signed “multiple large cloud services agreements,” she said, adding that revenue from Oracle’s namesake database that runs on other clouds continues to grow more than 100%.

The $30-billion deal ranks among the largest cloud contracts on record. That revenue alone would represent nearly three times the size of Oracle’s current infrastructure business, which totaled $10.3 billion over the past four quarters.

@TheTranscript_: $NVDA CEO at the AGM this week: "Blackwell's rollout has been extraordinary. It debuted with $11 billion in sales in the fourth quarter. and went on to more than double the contribution in our first quarter this year, easily the fastest ramp in our history."

Meta is looking to raise $29bn to fund its all-in push into artificial intelligence, turning to private capital firms to finance its build out of data centres in the US.

Talks between the Instagram-owner and private credit investors have advanced, with several large players including Apollo Global Management, KKR, Brookfield, Carlyle and Pimco involved in the discussions, according to people familiar with the matter.

Meta is hoping to raise $3bn of equity from them and then a further $26bn of debt. But it is debating how to structure the massive debt raising, as it considers options for what will be one of the largest private fundraisings of its kind. The company could also look to raise more capital, one person added.

In partnering with big money managers, Meta and its biggest rivals are splitting the risks and costs of massive investments as they compete to secure computing capacity to power their AI models.

Meta was working with its advisers at Morgan Stanley to arrange the financing, and it was considering ways that could make the debt more easily tradeable once it was issued, the people added. That is one factor potential investors who have studied the transaction have raised, given its sheer size.

As for Caterpillar, it’s also in a good position to benefit from this trend, despite not being well-known for natural-gas turbines. It has an opening because the biggest players in the natural-gas turbine industry— GE Vernova, Siemens Energy, and Mitsubishi Heavy Industries —are struggling to keep up with all the demand for new natural-gas power plants, given increasing demand from data centers and other electricity users. Within four years, new data centers are cumulatively expected to consume more than 10 times as much power as a big city such as Philadelphia.

For tech companies that want turbines now, Caterpillar—which tends to sell smaller turbines than the big players—is one option. Bank of America analyst Michael Fenigar wrote this month that power generation is now the fastest-growing business at Caterpillar, and one of the “least understood.” Data-center power is a big part of that. Fenigar rates Caterpillar stock at Buy with a $385 price target.

Meta’s Ohio project will sit on a 740-acre campus in a city called New Albany. The data center is already under construction, according to state regulatory documents. The power plant next to it will provide 200 megawatts of capacity, or enough for around 100,000 households if it was connected to the larger grid. There will be three Siemens turbines on site, 12 turbines developed by a Caterpillar subsidiary, and 15 Caterpillar reciprocating engines, according to the regulatory documents.

If companies are forced to swallow the cost of tariffs, it would represent downside risk to margins. Our economists assume consumers will absorb 70% of the direct cost of tariffs. However, some recent business surveys have indicated lower pass-through, and the May inflation report showed limited tariff imprint. Analyst revisions to margin estimates have been more negative for companies most exposed to tariffs compared with the typical stock. Early earnings results offer conflicting messages on the margin outlook.‬‬

European stocks outperformed their US peers by the biggest margin on record in dollar terms during the first half, the most dramatic sign of how the region’s markets are staging a comeback after more than a decade in the doldrums.

The rebound isn’t confined to stocks: the euro is up 13% against the dollar in the six months through June. Meanwhile, the chaotic rollout of US tariffs wiped some of the shine off Treasuries. German bunds have outperformed them since April even as the government braces to issue more debt. Assets in emerging European markets like Poland and Hungary are also rallying sharply.

Investors globally are slowing their purchases of US assets and shifting more money to Europe amid concern that President Donald Trump’s program of tariffs and tax cuts will impact earnings, stoke inflation and widen the budget deficit. Europe has become the big beneficiary as governments there boost spending while its central bank slashes interest rates.

"Even so, increases in tariffs this year are likely to push up prices and weigh on economic activity. The effects on inflation could be short-lived, reflecting a one-time shift in the price level. It is also possible that the inflationary effects could instead be more persistent."

"For the time being, we are well-positioned to wait to learn more about the likely course of the economy before considering any adjustments to our policy stance." - Federal Reserve Chair Jerome Powell

@TheTranscript: $NKE CFO: "With the new tariff rates in place today, we estimate a gross incremental cost increase to NIKE of ~$1B...For fiscal '26, we expect this financial impact, net of the actions described earlier to be ~75 bps to gross margin, with a greater impact in the first half"

@wallstengine: Japan Tariff Negotiator Akazawa: Continuation Of 25% Tariffs On Autos Would Cause Significant Damage

Ford Motor Co. temporarily idled factories in the US over the last three weeks due to a shortage of magnets containing rare earth minerals, key components embroiled in US trade tensions with China.

Chief Executive Officer Jim Farley said the situation demonstrates the need to develop a domestic supply chain for critical auto components. China has instituted a new approval process for exports of rare earths that has slowed supply lines.

“We cannot get any high powered magnets without China,” Farley said Friday at the Aspen Ideas Festival. “We shut down plants for the last three weeks because we cannot get high powered magnets.”

Farley said those magnets are critical to seats, windshield wipers, doors and audio systems. “We can’t make that stuff,” he said of the magnets.

Trade policy isn’t usually top of mind for new parents like Brinich. But with higher prices following President Donald Trump’s sweeping tariffs announced in April, the impact is front and center for families trying to save. Baby gear is a category of spending that’s almost impossible to skip, and the surge in demand for secondhand goods is one of the clearest signs of how tariffs have showed up in everyday life.

With most baby products manufactured in China — which is at the center of Trump’s trade war — a number of brands have raised prices in the past two months. The cost of UPPAbaby’s Vista V3 stroller and bassinet combo is roughly 35% higher at $1,480; Nuna’s RAVA Convertible Car Seat is up 24% at $680; and the Stokke Tripp Trapp high chair is 17% more expensive at $349.

GoodBuy Gear, a popular “pre-loved” baby gear site, has seen search sessions for strollers and car seats jump more than 30% since tariffs were announced. OfferUp, an online marketplace, said searches for UPPAbaby, in particular, more than doubled from a baseline. And Stork Exchange, an overstock company, said it experienced a 30% sales spike in May compared to April.

@RenMacLLC: Nominal durable goods consumption has contracted this year, down 2.9% SAAR over the last five months. Consumers are resistant to tariff induced price increases.

Spending growth by Chase customers is slowing down, according to JPMorgan analyst Richard Shane.

“Total spending growth decreased to ~2.0% as of June 20, below the May figure of ~2.3%. The June MTD growth rate has decelerated throughout the month as more data has become available,” Shane said in a note to clients.

Spending growth rises to 2.7% when excluding gas stations, driven by lower oil prices, Shane said, but is still below the 3.1% growth rate in the same metric from May.

Among Gen X and baby boomer Chase customers, spending is down year over year in June.

BoA card spending in the week through Jun 21st continues to deteriorate now -0.5% y/y (after +0.1% the prior week) with former laggards remaining weak but a core YTD leader, online electronics, continuing to see more softening which started mid-May.

Every month, thousands of randomly selected Americans get a letter in the mail from the University of Michigan asking how they’re feeling. This year their answers have been pretty unambiguous: bad.

They’ve been feeling bad about prices, bad about business conditions. Bad about their incomes and job security, the housing and stock markets. They’ve felt so bad, in fact, that Michigan’s Index of Consumer Sentiment was stuck at one of its worst readings on record for two months this spring after plunging 29% in the first four months of 2025. Over the 79 years of the survey, a drop this large this fast has almost always predicted a recession. Sentiment readings improved slightly at the start of June but still indicate Americans expect much higher prices and a much slower economy in the coming year.

“When all the signals are pointing the same way, I think we need to take the consumer seriously,” says Joanne Hsu, the director of the University of Michigan’s Surveys of Consumers. “It’s just really dangerous to overlook.”…

It’s clear to Hsu—who in 2022 became the survey’s first new director in 46 years—that many investors and analysts don’t really understand the data they’re dismissing. Critics are “missing the point,” Hsu, 43, says during an early June walk across the university’s leafy Ann Arbor campus. Rather than only basing their outlooks on news or government data, consumers absorb a gut sense of the economy while going about their days—shopping for groceries, gossiping at work, paying bills. Other factors like age, health and political views can sway their feelings, but that’s a feature not a bug, because those attributes also affect their future spending. And the survey is rarely wrong. In 1974, for instance, it spotted the worst recession since World War II, while ever-rising sales of TVs, cars and other consumer goods were tricking economists into thinking things were fine. Even if you discount the accuracy of regular people’s predictions, she maintains, they’re still telling you something important.

Cheerios maker General Mills Inc. offered an outlook for the fiscal year ahead that fell below investors’ expectations, projecting a lower adjusted profit as cautious consumers continue limiting their grocery expenses.

The Minneapolis-based company, which makes Progresso soup, Lucky Charms cereal and Blue Buffalo pet food, anticipates that the operating environment will continue to be volatile as value-seeking consumers feel pressured by tariffs, conflicts around the world and shifting regulations, said Chief Executive Officer Jeff Harmening in a statement.

“We’re not counting on a significant rebound in categories as we work our way through the year,” he added during a Wednesday call with analysts.

In a tough economic environment, the company sees the snacking category as “a bit more of a discretionary spend,” said Dana McNabb, group president for North America retail, on the call. “So our categories and our businesses have had a tougher time this year.”…

The company said fiscal year adjusted earnings per share will be down as much as 15%, and that organic sales will fall between a 1% decline and a 1% increase. The company sees a 1% to 2% hit on its cost of goods sold from tariffs, but is substituting ingredients and reformulating products to limit the impact, Chief Financial Officer Kofi Bruce said in prepared remarks.

In addition to budget-conscious consumers, the US’s largest food companies are facing a number of other challenges including the continued loss of market share to lower-cost private label brands.

“Growth for the next two quarters came in at -1.0% below the +0.5% in March and lower for the 5th straight survey since peaking in June ‘24, and below the avg expected rate since the Financial Crisis (+1.5%).”

What’s really interesting is the speed of the turnaround here. Back in March, just 11% of survey respondents said containerboard prices were more likely to fall than rise. As of June, that’s now up to 61%. Meanwhile, the percentage of respondents who expect prices to rise over the next 12 months, has shrunk from 81% in March to 11% now. That's a pretty big turnaround in the space of just a few months.

@LizAnnSonders: May new home sales -13.7% m/m vs. -6.7% est. & +9.6% prior (rev down from +10.9%) … worst drop since June 2022

@RickPalaciosJr: Home prices are falling YTD, which isn’t normal.

@RenMacLLC: As inventories climb, home prices appear to be cooling across most of the country. According to the latest Case-Shiller Home Price Index, just 30% of the cities surveyed have seen home price appreciation over the last three months.

@M_McDonough: Interest rates matter—a lot: In 2020, buying a $500K house (20% down,30Y mortgage) meant a total monthly payment of ~$1,654, with interest just $950. Today, interest alone ($2,293) is higher than your entire 2020 payment. Monthly total now ~$2,629.

Your company also has been doing work on GLP-1 drugs. What does a medication that addresses weight loss and type 2 diabetes have to do with Aon?

If you’re head of HR at a company, you’re in a really difficult spot. You’d like to [include GLP-1 drugs in healthcare plans] because it might be helpful, but the cost is massively prohibitive. The question is, is it worth it?

We pulled together a 50 million person database and took out from that database the 130,000, 140,000 people who have actually taken GLP-1 drugs for 24 months, and asked the question, did the cost of health go up or go down if you’re taking the drug? Never been done before.

And the answer was?

A greater than a 10% reduction in trend. It’s crazy, amazing. You incorporate the cost of the drug, and over time, you reach a one-point change in trend in healthcare costs. It’s massive.

And it’s not just about the trend cost. It’s also about the deferred onset of things like diabetes, osteoporosis, et cetera. The cost you spend is less about remediation and more about prevention. Over time, at a 10-plus percent trend decrease, no matter the cost of the drug, even in the current cost [and the cost of the drugs are going to come down], you cross [and save money]. I’m not trying to overstate this, but we think this is a generational opportunity to improve population health in a way we’ve never seen before. So now our goal is to how do we help our clients introduce this into their work groups, in a positive way?

The US Navy and National Oceanic and Atmospheric Administration (NOAA) will no longer accept and distribute readings from the long-running Defense Meteorological Satellite Program after June 30, according to a service notice.

One of its top applications is helping forecasters accurately predict whether a storm is going to rapidly intensify — that is, when top wind speeds increase at least 35 miles (56 kilometers) per hour over a 24-hour period. When weak storms suddenly strengthen, they can endanger coastal residents and add stress for emergency managers trying to allocate limited resources.

In recent years, many storms have undergone rapid intensification, notably last year’s Hurricane Milton. That storm spun up from a tropical storm to a Category 5 hurricane on the five-step Saffir-Simpson scale in just over a day. While Milton weakened to a Category 3 storm as it made landfall last October, other storms have intensified right up until landfall. The includes last year’s deadly Hurricane John, which dropped nearly 57 inches (145 centimeters) of rain on parts of Mexico.

Research suggests tropical systems will be far more likely to become powerful hurricanes through rapid intensification as the world continues to warm.

The Defense Meteorological Satellite Program data — which has been available to researchers and weather bureaus around the world — helps the NHC look inside storms while other satellites only look at “at cloud-top level,” said retired NOAA meteorologist Alan Gerard.

Walk into this airport terminal and gasp. It’s practically a nature bath. Skylights built into soaring timber roofs filter sunlight onto the oak floor. Live trees and massive video walls showcase stunning landscapes. Sit for a spell on the stadium-style wood benches. Linger on the real-life view of Mount Hood from Concourse E. This space is – it’s hard to believe – relaxing. And that’s despite construction set to wrap up next year.

This is an airport that has fun and wants you to do the same. See it in the swaths of fan-favorite carpet (seriously) and hear it from the live musicians. Spot it in the speakeasy. Feel it when you scritch a visiting llama. Share it from the oversize pink mailbox.

While you’re at it, enjoy the flavors from local restaurants and shops; Tillamook fried cheese curds, anyone? Airport prices aren’t inflated versions of their outside selves, which means your honey lavender treat from Blue Star Donuts or sour beer at Loyal Legion Beer Hall might just be regular-expensive instead of appalling.

It all adds up to an airport with so much to enjoy that you may wish for a delay.