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Public.com presents the rundown, your daily market update in under 10 minutes. My name is Zaidadmani and today is Tuesday, December 9th. In today's episode, we'll tell you why Nvidia is about to re enter the Chinese market. We'll also tell you about Google's plans to release smart glasses. Then stick around to the end of the show to find out how you can win $15,000 by watching Netflix. We got a great show for you today. Let's go.
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Well, stocks were off to a slow start this week, snapping a four day win streak on Monday as the S&P 500 fell 0.3% while the Nasdaq did a bit better, dropping only 0.1%. The tech sector was the only one to finish in the green yesterday. Along with small cap stocks, the Russell 2000 also squeezed out a small gain on Monday. Small caps have been cooking lately because investors expect the Fed to cut interest rates at the Fed meeting tomorrow. And when borrowing costs cheaper, smaller companies tend to benefit the most. Now what's interesting though is that despite the markets pricing in a 90 chance of a rate cut tomorrow, the 10 year treasury yield continues to drift higher. It's currently sitting around 4.17%. That's the highest level since September. Now I know we don't talk a lot about US treasuries on this show, but the 10 year yield is pretty important because things like mortgage rates follow the 10 year yield and not the Fed rate. So even if the Fed keeps cutting interest rates but the 10 year yield rises, we're not going to get cheaper mortgage rates, which I think a lot of people were hoping for. Historically, the 10 year yield tends to move together with the Fed funds rate, but not always. The 10 year yield is ultimately market driven and the fact that it's moving higher right now despite rate cuts projected could be a sign that markets are concerned that the Fed won't cut rates in 2026 because of inflation. Or the markets could be concerned about other long term uncertainties like geopolitical risk or the US national debt. So I'm definitely keeping my eye on the 10 year yield right now. Now, now going back to the Fed, we are going to get the famous Fed dot plot at the Fed meeting tomorrow which shows where each Fed official expects interest rates to be over the next three years. Now markets love to overreact to this charge, so buckle up. But we'll break it all down on Thursday's episode, so make sure you guys are subscribed to the podcast and tuning in Every day. To stay in the loop, let's run through some headlines, starting with Nvidia. President Trump just approved a plan that will allow Nvidia to sell their H200AI chips to approved customers in China. And in exchange, the US government will take a 25% cut of all those sales. Now, the H200 chip is not Nvidia's most powerful AI chip. It's actually a step below the new Blackwell and Rubin chips. But according To Bloomberg, the H200 chips are still roughly a full generation ahead of anything that China can make domestically right now. Now, there's been a lot of drama involving chips in China. The US government allowed Nvidia to sell their watered down H20 chips to China, but then China banned those chips earlier this year. Security reasons. Now, the main reason for that ban was to become self sufficient and force domestic chip makers like Huawei to innovate. And Even though the US has unbanned these H200 chips, the Chinese government still needs to approve the imports of these chips. President Trump did say on Truth Social that Chinese President Xi responded positively to the H200 chips being unbanned. But according to the Financial Times, the Chinese government will limit access to these chips to further push their domestic chip makers. Still, this does open the door for Nvidia to start making money in China again. Back in 2024, China accounted for 14% of Nvidia's revenue, and now it's basically zero. So this new development could mean billions of dollars in additional revenue for Nvidia. Now, Chinese tech companies are pushing out innovative open source AI models. So there's a huge demand for Nvidia's powerful chips. Now, critics argue that sending powerful AI chips to China could accelerate China's AI capabilities. That could ultimately hurt the US Tech companies. But the counterargument from Nvidia is that if we don't sell chips to China, then Chinese tech companies will just buy them from Huawei, which could result in Huawei catching up to Nvidia one day. Honestly, I see both sides of this argument. I think I'm leaning towards allowing the export of these chips to China. But then again, I might be biased because I do own some Nvidia stock. Let me know in the comments on what you guys think. I do find it funny though, how the US government will get a 25% cut of the revenue. It's like you have to pay a fee to the US Government to do business in China. Now let's shift gears from one AI giant to another and talk About Google. According to a report from Bloomberg, Google is planning to launch smart glasses in 2026 with two versions, one with a virtual AR display and one that's audio only. Google's hardware partner on this includes Samsung Warby Parker and Gentle Monster. And Google has already built some prototypes with eyewear maker X Wheel, codename Project Aura. These glasses will be powered by the Android XR operating system, which actually powers the Samsung smart glasses. And of course it's going to have a heav dose of AI with Google's Gemini being integrated throughout. Now, I think Google saw the success that Meta had with their smart Ray Ban glasses. There's also rumors that Apple is working on smart glasses as well. So Google is ready to compete and they might have a leg up since their AI tech is considered to be the best. So smart glasses are expected to be a growing category. I think they have a much higher upside than the VR headsets because again, nobody wants to put a thing on their face. Let's just hope that Google has learned their lesson from the Google glasses flop they had over a decade ago because those glasses were terrible and, and absolutely hideous. I think the key for these glasses to be a success is they have to actually look like glasses. Now, investors are reacting to this news by buying up Warby Parker stock, which is up more than 5% this morning. Let's talk about some stocks making moves today. Shares of the private credit company Aries Management is rising this morning on the news that they will be added to the S&P 500 on December 11. Aries is replacing Kello Nova, which is about to be acquired by the snack company Mars. You know, the private credit space has, has exploded over the last few years. It's become a popular way for companies to borrow money instead of going through traditional banks. And Aries has really capitalized on this. No. Companies like Aries pull together money from investors and lend it out. Their stock has jumped nearly 200% over the last five years and their stock is up another 8% this morning as S&P 500 index funds will now have to buy their stock. Now on the flip side, shares of the luxury home builder Toll Brothers are falling after reporting mixed earnings and warning that demand remains soft across many markets. You know, high housing costs continue to keep a lot of buyers in the sideline. Now builders have been cutting prices and offering incentives to move inventory, but that's put a squeeze on their margins industry wide. Toll Brothers, whose average home price is around a million dollars, reported that their gross margins fell by 1% this year to 25.6%. Now. The one bright spot for the company was that the homes under contract totaled 9943, which is slightly ahead of estimates. Still, I think investors are more focused on the margin pressure and the overall slowness in the housing market, which is why Toll Brothers stock is down nearly 5% this morning at recording let's wrap the show with a fun fact. Netflix is launching a live interactive mobile game show called Best Guest Live, and it's basically a modern reboot of HQ Trivia. And I mean that in the most flattering way possible. This game show will stream Monday through Friday at 8pm Eastern exclusively on the Netflix mobile app. And according to Netflix, the games will be a fast paced guessing game with multiple clues and the earlier you figure out the answer, the bigger your share the prize pool will be. Netflix plans to give away $15,000 per episode, split across two puzzles per night. And honestly, I think this is a smart move by Netflix. They've been leaning more into live programing and casual gaming and this hits both lanes at once. Plus, if you're already in the Netflix app at 8pm to play, Netflix is probably hoping you'll stick around and watch a show after, so this could help their watch time numbers as well. And let's be honest, Netflix is probably going to use this game show to cross promote all of their upcoming shows and movies as well. So yeah, really smart move by Netflix. And I wonder how many people are going to tune in every night. I bet this thing does pretty big numbers, at least in the beginning. My only crit is that the prize money is only $15,000. Like they just dropped 80 plus billion dollars to buy Warner's. At least make the prize money like a hundred thousand dollars a night or something. Well all right guys, that's the rundown for today. Hope you guys enjoyed today's episode. If you did and you have like five extra seconds, consider giving us a five star rating on Apple, Spotify, YouTube, wherever you listen to your podcast. And if you are listening on Spotify, don't forget to vote in today's Spotify poll. Leave us a comment on Spotify. All that Eng really does help us out and it helps other people find the show. Thank you guys so much for listening, watching and commenting. Shout out to Mike and Connor for all the work behind the scenes and we'll see you guys back here tomorrow.
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