← The Rundown
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Public.com presents the rundown. Your daily market update in 10 minutes. My name is Zaydadmani and today is Monday, June 29th. In today's episode, we'll break down last week's tech sell off and why investors are suddenly worried about the AI trade. We'll also tell you why Comcast is breaking itself apart and why SpaceX wants to become your next phone carrier. Then stick around to the end of the show to find out why Michael Burry is betting on microso. We got a great show for you today. Let's go. Markets are coming off a tough week. The S, P 500 and Nasdaq fell every single day last week, with the s P closing down 2% while the Nasdaq fell 4.6%. On the week, tech and chip stocks took the worst of it. The semiconductor index fell nearly 8%, its worst week in more than a year. Now, there seems to be growing concern now about the negative impacts of the A, especially to consumers. There was a shock to the market last week when Apple and Microsoft both announced pretty significant price hikes to their products because of higher memory prices caused by the AI boom. We actually did a whole deep dive on this topic over the weekend, so go check that out. If you missed it, we'll put a link in the description. Now, the other concerning thing to keep an eye on is the amount of leverage in the market right now. Market debt hit a record $1.4 trillion in May, which means that people are borrowing more and more money than ever to invest in the stock market. Here's a crazy stat. Leverage ETFs have nearly doubled to $220 billion. So you've got people out there stacking leverage on top of leverage. And while that might be helping the markets move higher, it can unwind pretty fast and things can get pretty ugly. You see this happen all the time in the crypto markets where there's historically been a lot of leverage. And crypto prices can drop in an instant. By the way, speaking of crypto and prices dropping, Bitcoin has now fallen below $60,000 for the first time since October of 2024. But look zooming out though. Despite the sell off in tech, the rest of the market is actually holding up fine. Now, longtime listeners know I'm not a big fan of the Dow, but it did gain 0.6% last week. And looking at the equal weight S&P 500, it was up 0.4% and outperformed the regular S and P by the widest margin since 2020. So there seems to be a clear rotation happening out of tech and AI, everything else. Now we'll have to see if that rotation continues this week or will investors buy the tech dip. By the way, this week is a short week. The market will be closed on Friday for the 4th of July, but the June jobs report drops on Thursday. So that should tell us more about how the overall economy is holding up. We'll cover all of that and everything else happening in the market. So definitely get subscribed to the podcast if you're new here, and tune in every day. To stay in the loop, let's run through some headlines, starting with Comcast. Comcast is breaking itself up again and the market absolutely loves it. See, right now, Comcast is a major conglomerate. They own a ton of stuff like broadband Internet, cable tv, wireless phone service, the Universal theme parks. They also own a movie studio, NBC, the Peacock streaming service, and a bunch of other networks. Well, the plan for Comcast is now to split itself up into two separate companies. On one side, you'll have the new NBC Universal Company, which will include the theme parks, the movie studio, the TV studio, the NBC channel, Telemundo, Peacock, Bravo and Sky. And then on the other side, you'll have the remaining Comcast, which will be the broadband, Internet, wireless and cable TV business. So essentially, Comcast is separating the broadband and cable TV business from the media business and the market. Love this news. With Comcast shares surging more than 20% at the time of this recording. You know, investors have been begging Comcast to do this for a while now. Comcast stock has been a disaster recently, down 30% over the past 12 months. The problem for the company is that the cable TV business is dying as more and more people cut the cord and move to streaming. And that dying side of the business has been dragging down the entire stock, including the parts of the business that are actually growing, like their theme parks. So by separating them, each company can now focus on what they do best and investors can choose which side they want to own. Current Comcast shareholders will get shares in both companies once the spinoff is complete. The this deal is expected to take about a year and still needs board and regulatory approval. By the way, this is the second spinoff that Comcast has done recently. Remember, earlier this year they spun off their cable networks like CNBC into a separate company called Versant Media. And honestly, my take is that this probably should have happened years ago. The conglomerate model just doesn't work anymore, especially when one side of your business is growing and the Other side is shrinking. The shrinking, struggling side just weighs the entire company down. So by splitting it up, it unlocks value. To use some Wall street jargon there. Let's shift gears and talk about SpaceX. According to the Financial Times, SpaceX is reportedly in talks with Charter Communications about a potential mobile phone partnership in the US this is part of SpaceX's plan to turn Starlink from a satellite Internet company into a full on phone carrier and take on the big wireless carriers like AT&T, Verizon and T Mobile. Now the problem for SpaceX is that satellites alone aren't enough to run a nationwide phone need things like Spectrum and billing and customer support and a lot of ground based infrastructure. So that's where a partnership with Charter could come in. Charter is a company behind Spectrum. It's one of the largest home Internet providers in the US and they also have a mobile business called Spectrum Mobile. So In a potential SpaceX charter partnership, SpaceX could bring the satellite connectivity and the Starlink brand, while Charter could bring the ground Internet infrastructure along with the customer relationship. And that could be enough to compete with with the big three phone carriers. Now, to be clear, no deal between the two companies has been announced yet. They're still just talking. And even if SpaceX doesn't fully become the fourth major wireless carrier, this is still a warning shot to the telecom industry. The market seems to be taking this potential partnership seriously. Shares of charter are up 15% this morning at the time of this recording and SpaceX is up around 1%. It's possible that SpaceX is just using this as leverage to potentially get a partnership with one of the big three phone carriers. So definitely something to keep an eye on. I mean, SpaceX has told investors that they see the mobile space to be a much bigger opportunity than just the home Internet space. Let's talk about some stocks making moves today. Rocket Lab shares are soaring this morning on the news that they are buying the satellite communications company Iridium in a cash in stock transaction valued at about $8 billion. This acquisition would create a vertically integrated space company and help Rocket Lab expand beyond just launch services and spacecraft manufacturing. Iridium would give Rocket Lab access its constellation of low orbit satellites and a communications customer base of more than 2.5 million people. On top of that, Rocket Lab would also get Iridium Spectrum. So this acquisition is essentially Rocket Lab trying to compete with SpaceX's Starlink. And with this deal, Rocket Lab would also lock in a steady dose of stable reoccurring cash flow. Iridium brought in $872 million in 2025, which is actually 45% more than what Rocket Lab generated. Despite that, though, Rocket Lab's market cap is more than 12 times larger than Iridium. And the reason for that is Iridium is not a growth company. Their quarterly sales haven't grown more than 10% since June of 2023. On the flip side, Rocket Labs revenue grew 64% last quarter and crossed $200 million for the first time. So it's possible merging with Rocket Lab could reignite the growth at Iridium. The market seemed to like this deal. Rocket Lab shares are up around 8% this morning, while iridium is up around 20% now. On the flip side, shares of Verizon are sliding this morning after the telecom company announced a deal to merge as international operations with the UK's BT Group in a new joint venture. The combined business would generate about $4 billion in annual revenue. Now, Verizon says it expects to book an accounting loss of between 700 million and $800 million in connection with this deal, essentially writing down the value of these international assets. But Verizon can now focus more on their home US market. The market did not like this deal though. Verizon stock is down more than 7% this morning at the time of this recording. Let's wrap the show with a fun fact. Microsoft stock is on pace to have its worst month since the dot com crash. Microsoft stock is down around 17% so far for the month of June, which would be the worst month since December of 2000. This sell off in the stock has wiped out more than $570 billion in market cap. And Microsoft stock is trading near its 52 week lows. You know, it's kind of crazy to think back to 2024 and 2025 where a lot of people thought that Microsoft would be the big winner of the AI boom because of their early investment in OpenAI and being an exclusive provider of OpenAI's models on their cloud. But now the vibe is totally shifted. For one, the relationship with OpenAI has soured and Microsoft's own AI tools like Copilot are just a complete joke. And then on top of that, the market seems to be worried now that all the CapEx spending from Microsoft won't lead to meaningful revenue down the line. Now, Microsoft doesn't have a leading AI like Google does and they don't have their own custom AI chips like Amazon does. So that's why Microsoft stock is getting beaten up right now. And I've seen some people call out CEO Satya Nadella and say that maybe he should be on the hot seat now. This could all just be an overreaction by the market and be a good dip buying opportunity. You know, Microsoft is still one of the most profitable companies on the planet and their stock now trades at just 19 times forward earnings. That's actually the cheapest the stock has been in a decade and it's actually trading at a discount compared to the overall S P 500 which trades at 20 times forward earnings. In fact, Michael Burry is now buying the dip on Microsoft. He wrote in his substack last week that he bought long dated call options with strike prices in the low 700s that expire in 2028. The stock closed at around $373 on Friday. So Michael Burry is essentially betting that Microsoft will nearly double within the next two years. And by the way, Michael Burry still clearly has a lot of influence because Microsoft stock jumped nearly 6.6percent on Friday. Following his substack posts. Let me know in the comments of what you guys think. Why do you think that Microsoft is getting beat up so bad by the market? And should Satya Nadella be on the hot seat? Well all right guys, that's the rundown for today. Hope you guys enjoyed today's episode. Thank you guys so much for listening, watching and commenting. Shout out to Mike for all the work behind the scenes and we'll see you guys back here tomorrow.