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JP Morgan has teams to support you at every stage of your growth. As former founders who have worked in local markets themselves, the bankers at JP Morgan bring deep sector knowledge and lived experience to their clients. JP Morgan can help you navigate complexity with confidence backed by real world insights and an entrepreneurial perspective. Get what your startup needs now@jpmorgan.com growwithoutlimits JP Morgan is the bank of the innovation economy. SpaceX joining the NASDAQ 100 under the index's new fast track rules, we break down what it means for investors in famous ETFs like the Q. Q. Q. It's merger Monday. We have the latest corporate moves sweeping Comcast, nbcu, Versant and even Tiger Woods. And SK Hynix, the South Korean chip giant is turning heads as it hits Wall Street. We take a look inside its multi multi billion dollar listing. We welcome back from the long weekend. We're thrilled to be back in the seat. It's Monday, July six, and it's Blue Markets Daily. I'm Ann Barry. More market details to come. But first, it's one of the biggest capital markets stories of the year. And by the way, it's already been a big 2026 on that front. And that's because South Korean memory chip giant SK Hynix LE launched its long awaited U S Nasdaq listing today, set to raise roughly 43 trillion won, or about $28 billion through American Depository Receipts, or ADRs. Well, this isn't an IPO in the traditional sense because SK Hynix already trades in Seoul with a market cap as of Friday of about $1.1 trillion. But by listing adrs in the United States, the company does get to open the door to a much broader base of global investors. So just to take a moment for the technicals, ADRs are issued by US depository banks to represent shares of a foreign company. So instead of navigating foreign stock markets or dealing with currency conversions, an American investor can simply purchase an adr, while the US bank buys the underlying shares in the foreign company's home market and holds those shares in custody. The sheer size of the offering is turning heads because at about $28 billion, it ranks as the second largest equity share sale on record, behind only SpaceX's offering and ahead of landmark deals like Saudi Aramco's 2019 IPO. And it's the latest sign that investors remain willing to write enormous checks for companies at the center of the artificial intelligence boom. SK Hynix is the world's leading supplier of high bandwidth memory chips, the specialized memory that powers AI systems built by customers that include Nvidia. While SK Hynix says the proceeds will help fund new semiconductor fabrication plants in South Korea and with the purchase of advanced manufacturing equipment, including cutting edge lithography tools, well beyond banking the cash. The company also seems to hope that the US Listing could help to close SK Hynix's valuation gap as compared with some of its American semiconductor peers. Because while SK Hynix has been recently trading at a forward PE that's price to earnings ratio of somewhere between six and eight times, US Peers like Micron have been up at multiples on the same basis as high as 14 times strong expected forward earnings. By making the stock easier for U.S. institutional investors and index funds to own, broader investor access could ultimately translate into a higher market valuation. Lots going on here. We're going to keep on watching. Well, later in the show we have spin offs and tie ups and a rapidly changing TV landscape. We connect the dots and bring it all back to Comcast. But first, let's take a spin through some of the headlines from the day's trading session. Kicking it off with a merger Monday story out of defense giant Lockheed Martin. The company announced it will acquire naval defense group ultramaritime in a $3.5 billion deal. Or just for context, Ultramaritime produces undersea and anti submarine warfare tech and it's being bought from private equity firm Advent International. Right.
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Lockheed is one of the world's largest defense firms producing planes like the F35 Lightning II fighter jet and Patriot air defense missiles. So this deal marks a major push into undersea warfare technology. We've been covering undersea on the show lately with attacks and mines and the Strait of Hormuz putting a spotlight on maritime security as of late. And in today's press release, Lockheed leadership said, quote, undersea superiority belongs to those who move fastest and work together best. Shares of Lockheed Ticker LMT are down nearly 1.5% today, but remain up over 10% since the beginning of this year. And from underwater to outer space, SpaceX is joining the NASDAQ 100 tomorrow. That index tracks 100 of the biggest non financial companies on the Nasdaq with which in turn is tracked by hundreds of mutual funds and ETFs. When SpaceX joins the index, those funds like the QQQ will automatically buy shares of the space stock, boosting liquidity and broadening the company's shareholder base almost immediately.
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Well, here's one interesting nugget. Even though SpaceX does have a $2 trillion market cap, it won't actually enter the index as one of its largest holdings. So here's the reason why. It's because the NASDAQ 100 doesn't just consider a company's total market value. It also looks at how many shares actually available for the public to trade, known as the company's free float. Well, in that blockbuster IPO we saw recently SpaceX sold under 5% of its shares in that offering. So the index will effectively treat it more like a 300 billion dollar company than the 2 trillion dollar giant that it actually is. And that smaller weighting also limits just how much exposure index funds will have to SpaceX for as long as most of the company's shares remain held by insiders.
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So we'll see if SpaceX gets a boost from its inclusion. Shares are down 3% today and down around 19% from all time highs recently last month. And finally over to Microsoft, this year's worst performing member of the Magnificent Seven. It announced today that it's pressing reset on its Xbox division. Xbox will cut around 20% of its workforce and divest 4 of its game studios.
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But the overhaul comes after years of challenges. Xbox has struggled to consistently release blockbuster games. Hardware sales have also been in decline with the the goal is to simplify the business, focusing resources on fewer, higher priority projects that include Minecraft and Candy Crush instead of competing across every part of the gaming market. Well, shares of Microsoft ticker MSFT down around 1% today on the news. Well, coming up, we've got Comcast, one of its pending spin offs, is already making acquisitions. We break down the latest moves from the cable OG and its evolving family tree.
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Well, today it's a media merger Monday with multiple spinoffs and tie ups reshaping the TV landscape both here and abroad. And the player at the center of all of this activity, at least in the last 24 hours, is Comcast. Well, last week Comcast had announced it would spin off two assets, NBCUniversal and Sky, into a separate media and entertainment company. Name still to be disclosed. Meanwhile, the Comcast left behind will focus on its OG cable and Internet connectivity services. Essentially, it's separating the NBCU and Sky content from the Comcast pipes or plumbing. But while breaking up on the one hand, sky is scaling up on the other announcing it's acquiring ITV in the United Kingdom. So there are so many acronyms. But John, let's discuss this deal which was clearly biased in its inclusion. I'm just, literally just off the plane back from London, so start with itv. I did watch it while I was in the UK last week, so we're speaking my language here.
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Yes, great. Well, it makes sense that I should kick off ITV having not recently been in London, but I'll give you some British context here. Itv, it stands for Independent television. It's considered the oldest and largest commercial TV network in the UK and it's funded by advertising. So as opposed to the BBC, similar to the broadcast networks in the U.S. like NBC or CBS, it trades on the London Stock Exchange, has a market cap of about $3 billion. So similar to the networks here in the United States, ITV has struggled with tough ad markets and declining viewership. And shares in the company are down 36% over the last five years. So here comes a possible lifeline. Comcast. Sky has agreed to buy itv, the broadcast channels and the streaming service it has for £1.6 billion or about $2.1 billion.
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So this is an argument that we've heard before, right? We've got these broadcast companies arguing that they have to scale up to compete in the attention economy with the massive streamer like Netflix and also with YouTube, we must never forget YouTube, the sheer scale of that in terms of the share of eyeball time it gets. Well, ITV CEO Carolyn McCall said, quote, a time of really rapid change in viewer behavior and growing competition from U. S streamers for both audiences and advertisers, this deal strengthens British content investment. So there are sort of two parts to the statement, right? Number one is, let's just talk about that. This is a. It's not just news, they do have some news, ITV news. But this is a place that has really been a home for British created content for a long time, basically acknowledging that it is in direct competition with U.S. content for attention of its viewers. Which is a pretty extraordinary statement to make, right?
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Netflix has this reach across the world. That's what Netflix has that the other streamers don't.
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Exactly.
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Even when we talk about the Paramount deal or things over at NBC or at Disney, Netflix has that global reach. And I think that's what's in competition here.
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And you sort of ask yourself, who is the ITV CEO talking to in this statement? Right? On the one hand, is it to satisfy the shareholders of ITV saying, look, this is a deal that should make sense. So clearly those of you who are going to vote on this, you should understand the rationale. But is the subtext here also, frankly, for the UK regulators, there's been a lot of activity in UK media, not only, by the way, in television, but also in print. So a little bit of inside baseball here. Morning Brews owner Axel Springer recently bought the Telegram, which is a British newspaper. So, you know, there's been a lot of activity, there's been lots of UK regulatory activity in the space. The sale of the Telegraph, by the way, was not straightforward by any stretch of the imagination. At one point it looked like it was going to be purchased by entities based in the United Arab Emirates. So it feels as though from the statement, ITB CEO saying, look, international tie ups are going to be necessary here for the survival of this distribution, right?
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Wouldn't you be surprised five years ago if ITV and Sky got together, if regulators would be okay with that overnight? I mean, because that would have been such a massive tie up, right?
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You know, it's interesting, sky in particular, if you'd asked the question and invoked someone other than Sky, I may have had a slightly different answer. Sky News has been present in the UK for a long time. Sky Sports has been really present in the UK for a long time. And so it's one of those that I think has had a longer, a longer foothold in the US media landscape. But your point is, your underlying point is the right one, which is, do I think that regulators would perhaps have had as much appetite to allow a deal like this to go through five years ago versus today? And I think the answer is no. One thing I do think has come to the fore is frankly, it's the tech giants, right, who've been talking about the share of social media. They've made the argument so cogently that the competition for attention and eyeballs is really, really stiff. And it's the same argument, in my mind that's carrying over right now to when you're talking about television as it is, for, you know, matter arguing that Facebook and Instagram are at odds with the likes of Netflix and YouTube as well.
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So let's talk about that content, because what you're saying, content used to be king and now they're saying that maybe the platform is king in this competition.
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Yes.
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So it's worth noting the broadcast and streaming elements. The platform is being acquired by sky, but the content arm of itv, that's the studio that makes Coronation street and Love Island.
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Do you know what Coronation street is? Because you said that so confidently.
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I only know it from looking it up today. And that is a long running soap opera. Yes.
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I'm trying to think what the equivalent is. It's like Days of Our Lives, except very different in Vibe, trust me. Yes.
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If there were coronations at a general hospital, perhaps. So this seems like a paradox to me because just last week Comcast announced it's going to split itself in two. NBCUniversal, that's of course, NBC, Peacock, sky and now ITV are going to become one public company. Then Comcast is keeping the old broadband and mobile business. That'll be the other company. So Comcast is essentially saying in that it's spinning off its content so it can focus on the platform, which is what Comcast originally was. Then sky turns around and buys ITV's platform, but not its content. So I know there's a lot of different moving parts here, but for a while, until these deals are settled, it's one big corporate family still under Comcast. One seems to be betting on content and one seems to be betting on distribution.
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Yeah, well, it just goes to show perhaps that the appetite for US specific content over in the United Kingdom is perhaps different in terms of the competitive landscape than it is here domestically within the US for US content.
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Yes.
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So I can see a little bit of logic there, but your point's the right one is what's the ultimate strategy? Do you want to be pure play content? Do you want to be pure play distribution? Or as the answer is, it's just very difficult to try to figure it out in this evolving landscape. The other question here too is how much of this is really evaluation arbitrage, specifically focusing on the U.S. equity markets. Right. Playing to the biases or the interests or the, the anal. The analytical conclusions of US equity investors. Very different perhaps from what the UK or the UK investors might be thinking about those who invested in the London Stock Exchange. I don't see a lot of United States investors buying itv. Right. Or frankly a lot of stocks, given what's going on over there at the moment. I was just joking, John, that I tried so hard when I was out on vacation. Thank you, by the way. You and the team were just brilliant while I was out on vacation.
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We missed you.
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Well, I missed you all too, but I was hoping not to miss you because I wanted to not pay any attention to the news and take a break. And of course the UK's Prime Minister decided to resign while I was just. He announced he was stepping down while I was over there. So I'm actually quite glad just to be back in the thick of it. But a lot of activity going on here and, and you and I were talking about how normal is it for so much M and A activity to happen in one go?
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Like right at the same time you've got different things happening. Comcast currently owns itv but they're spinning it off. But they're going to. Sky is going to require. It's. There's so much going on at once.
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You know, a simultaneous spin off an acquisition has happened before. We've seen it in some of these food businesses, you know where we've seen some of these food companies about to break up and you know that there's perhaps going to be an acquisition on the other side of it and it basically is to try and get a proof point out of the gate to the investors of the spun off company that this thing still has legs that can survive on its own. But there's a lot of complexity around this and it just goes to show that particularly in these industries where there's a lot of regulation, you do have some time to figure these things out. These kinds of deals tend not to just happen and get greenlit overnight. Greenlit. You see, I'm trying to use the lingo even as we talk about these media assets. Well, look, Comcast just take a big step back, has had this insanely busy 12 months. So let's take a look at Comcast previous spin off earlier this year, but was set in motion last year and that's a spinoff of Versant. Now Comcast had decided that its collection of linear cable networks was weighing down NBC and Peacock. And so Comcast decided to carve out and bundle together cable properties including Ms. Now, what's called msnbc. You remember this now called Ms. Now, cnbc, the E Network, the Golf Channel, and created one big company called Versant which is now a standalone publicly traded business.
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And the headlines which made sense at the time were that Comcast is jettisoning its cable networks. It's all about this bundle of melting ice cube of cord cutting cable properties. But it also retained in that deal which got less publicity at the time, digital assets like Fandango, Rotten Tomatoes, Golf now and Golf Pass, those are all part of Versant. And so Versant executives have been saying over the past couple months that they want those platforms and digital assets to eventually be 50% of Versant's revenue stream. The other 50% coming from those cable
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channels you mentioned, which, you know what's so interesting to me when you talk about some of these digital assets, I have slight echoes of Yahoo right in my mind, right? And we had Jim Lanzone, who's the CEO of Yahoo, come on the show, do you remember earlier this year, and it turned out, at least under his leadership, that he was able to take some other digital assets and either sell them and realize some Money for them, TechCrunch is one example. Or to really embrace them, things like sports, fantasy sports, fantasy sports on Yahoo. And say, actually I'm not going to treat these like sort of orphan assets. I'm going to embrace them, put real management teams behind them and nurture them and help them grow. So the idea that there is some juice still left in these digital assets, even if perhaps it wasn't top of mind, that that might be so at the time that Versant was created, isn't completely stunning to me. I actually salute Versant for trying to lean in and make something of these. And here's the specific announcement that came out today, that's part of that overall sort of thesis. Vers announced today that it paid $530 million in cash. Cash is queen for something called Full Swing, which is a Tiger woods backed golf simulator and sports technology company. Now the seller is Brewing Capital, a private investment firm that bought full swing about five years ago for only $160 million. They're walking away with a three times triple in five years. And the way this seems to come together is Versant has the Golf Channel, it's now adding tee time, booking golf simulators along with having the benefit of the analytics software. That's the tech behind tgl, which is the indoor golf league backed by Tiger woods and Rory McElroy. And so it seems as though Versant is saying, look, if you've got these golf assets, whether it's the Golf Channel or Golf now or Golf Pass, let's own golf. Yes, right, let's own it. And that's what their strategy is, which is not crazy to me.
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It makes so much sense. And golf is evolving. The live tour is changing.
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And then.
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And you look this up that people Golf used to be seasonal, now it's year round. And especially through the use of these simulators.
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Yeah, the simulators is great. So I did nerd out on this. I needed to nerd out. I'm just back from holiday. I've got this nerd out energy waiting to jump out. I found an article from 2023 from the National Golf foundation saying that in that year an estimated 6.2 million Americans hit golf balls with a club in a golf simulator in the last 12 months, which was up significantly versus the pandemic. And I couldn't help but think I had a bit of deja vu on this. Do you remember when Peloton was struggling? I mean, it's still struggling. Everyone was saying, you know, what could Peloton be when it grows up? One idea was maybe it should be treated like a media distribution platform. And that in fact, those screens and when people are on their bikes, you know, they're streaming music, they're streaming video, they're streaming entertainment. And we should think of it as an entertainment medium.
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Yeah. You've got millions of people there looking at a screen, captive audience.
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And I, there was sort of echoes of this.
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Absolutely.
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As I, as I thought about the golf simulator. So again, I think it's a very interesting play on experience. Yeah.
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Because Versant folks were making fun of Versant at the time when they spun out. Oh, you know, what's the future of E Television or something like that. But it seems to be having a plan. Even though shares are down 3% today and down 33% since beginning as a standalone company.
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Which is all the reason I think they need to make some bold moves. And this at least to me is evidence that they're giving it a good college try. It is a bold move. It, it's something that, you know, they're really trying to get creative here. So we'll see how it goes. Well, look, shares in Comcast trading down about half a percent today. It is down 16% so far this year. So we're going to keep watching this one to see how the one time media conglomerate continues to spawn all of these smaller, smaller media companies going to keep on watching. Well, it's 4pm on the east Coast. The market's wrapping up for today. There it was, the closing bell and why we don't have a ticker tape. We'll throw it over to our human ticker, our producer, John. That's right.
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The S&P 500 finished up 7.10 of a percent for the day. The NASDAQ was up over 1% and the Dow finished over 53,000 for the first time, finishing the day up 3.10 of a percent.
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Really extraordinary when you think about everything that's going on and all of that volatility. Volatility, by the way, is our word of the day. And remember it because we have a fantastic interview coming up tomorrow. We break down exactly what volatility right now could represent. Well, just one final thought and that is as we just heard the closing bell, I hearken back to this morning's opening bell because for the first time ever, the NASDAQ and the New York Stock Exchange jointly ran the opening bell and they did that from the Oval Office to mark the first day of trading for Trump accounts. Well, in the tax code, the official legal name for these federally sponsored children's investment and retirement accounts is a section 530A account. But it became known as Trump Accounts from their starring role in the one big beautiful Bill act. Well, the Trump accounts include a one time thousand dollar contribution from the U.S. treasury Department for babies born from 2025 through 2028. Now, lots of companies like Morgan Stanley and Chipotle, intel and Comcast one that came up today have said that they will match the government's thousand dollar contribution for their employees children. But here's another reason this caught our eye, because it all goes back to the overriding theme of today, which is SpaceX. SpaceX's president Gwynne Shotwell today announcing that she would donate to the program with a gift that includes part of Shotwell's and her husband's SpaceX stock. The shares will go to around 2 million Trump accounts with a quote, bit more emphasis on children who live close to their home. Thought we'd just end the show with a little bit of philanthropy even as we continue to look at the markets. That's it for today's Brew Markets Daily.
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Brew Markets Daily is hosted by Anne Barry and produced by John Crow. Tarka Delatif Avenue, La Roya and Emily Miller. Our technical director is Lonnie Fiskas. Brittany Dottocco is our audio engineer. And the president of Morning Brew Inc. Is Devin Emery.
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Wake up tomorrow with the Morning Brew newsletter and tune in to Neil and Toby on Morning Brew daily. See you back here tomorrow, same time, same place.
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Hey, it's Ryan Reynolds here for Mint Mobile. Now, I was looking for fun ways to tell you that Mint's offer of unlimited premium wireless for $15 a month month is back. So I thought it would be fun if we made $15 bills, but it turns out that's very illegal. So there goes my big idea for the commercial. Give it a try@mintmobile.com switch upfront payment
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