Good morning investors! Things escalated over the weekend with Iran striking Israel with missiles and Israel hitting back, despite Trump requesting Israel to show restraint. The fragile ceasefire, however, persists for now.
Today we cover:
What to expect this week
SpaceX IPO
Midterm elections and stocks
📊 Economy and News
What to Expect this Week
Here’s what you need to keep an eye on this week:
Monday, June 8
Apple (AAPL) WWDC Keynote at 1:00 p.m. ET. The company is expected to unveil major AI updates, including a significantly improved Siri.
Tuesday, June 9
Cracker Barrel (CBRL) – Q3 earnings after close, conference call at 5:00 p.m. ET.
Casey’s General Stores (CASY) – Q4 earnings after close.
Wednesday, June 10
May Consumer Price Index (CPI) at 8:30 a.m. ET. April CPI rose 3.8% year-over-year (highest in nearly 3 years), driven largely by surging energy prices due to the Strait of Hormuz disruption. Core CPI was up 2.8%. This report will heavily influence Fed rate expectations.
Thursday, June 11
Adobe (ADBE) – Q2 earnings after close, conference call at 5:00 p.m. ET.
Friday, June 12
University of Michigan Consumer Sentiment at 10:00 a.m. ET. The index hit its lowest level since 1952 in May. Analysts expect continued weakness due to inflation and geopolitical concerns.
Global hits:
China’s central bank extends gold-buying streak to 19 months.
U.S. explores deploying Iranian assets to support gulf allies.
Trump is quietly rebuilding his tariff engine.
Reminder: Banco BPM invites MPS to $58 billion merger talks to form Italy’s second-biggest bank. In other news, U.S. confirms second Texas screwworm case, Canada restricts livestock imports.
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📈 Stocks
S&P 500 7,383.74 (-2.65%)
DJIA 50,866.78 (-1.35%)
NASDAQ 25,709.43 (-4.18%)
BRENT CRUDE 96.14 (+3.44%)
* Prices as of Mar 8td, 12:20 AM UTC
Morningstar Warns SpaceX IPO Is Overvalued by 55% at $1.75 Trillion
Morningstar initiated coverage of SpaceX ahead of its massive June 12, 2026 IPO and assigned a fair value of just $780 billion — roughly 55% below the company’s $1.75 trillion target valuation.
The research firm’s DCF model values the core launch business and Starlink at $611 billion, with the xAI merger adding only $170 billion. Key concerns include:
xAI’s $6.36 billion operating loss in 2025
High uncertainty around orbital data centers and Grok’s competitive position
Extremely rich valuation: 94x 2025 revenue (vs. Nvidia at ~22x)
Morningstar believes investors will get better entry points after the IPO due to a tiny public float (only 4%), staggered lockup expirations, and eventual selling pressure.
Additional risks highlighted: Elon Musk’s 85% voting control and governance issues from the xAI merger.
While ARK Invest is far more bullish (projecting up to $2.5 trillion by 2030), Morningstar advises caution and waiting for the post-hype reality to set in.
Do you expect SpaceX IPO to be a success?
Interesting: Marvell Technology and Flex to join S&P 500 index, replacing Pool and Campbell’s.
OPEC+ approves fourth oil output quota hike since Hormuz closure.
Surprising: Google to pay SpaceX $920 million a month for compute capacity at xAI data centers. Elsewhere, AstraZeneca CEO says AI is reshaping drug development — and helping boost the odds of success.
💵 Personal Finance
Midterm Elections Could Disrupt the AI Trade and Stock Market
The AI boom has driven U.S. stocks to record highs in 2026, with the S&P 500 surpassing 7,600 and the VanEck Semiconductor ETF (SMH) up 74% year-to-date. However, the upcoming November 6 midterm elections may create headwinds, particularly if Democrats flip the House, leading to a divided government.
Key risks for AI/semiconductor stocks include:
Potential Democratic push for data center moratoriums over electricity and grid concerns.
A more hawkish stance on China, further restricting semiconductor exports.
Historical context: Midterm years are volatile. The S&P 500 has averaged losses in Q2/Q3, with even weaker performance under divided government (only 4.8% average return since 2000 vs. 10-12% under single-party control).
Other impacted sectors:
Data Centers: Least favorable under a full Democratic sweep.
Financials: Democrats may impose new restrictions on prediction markets.
Defense: Skepticism toward large budget increases under Democratic control.
While some strategists believe the election's policy impact may be limited, a faltering AI trade would likely pressure the broader market. Investors are eyeing ETFs like SOXQ (semiconductors), XLF (financials), and ITA (aerospace & defense).
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