Stock markets are buoyant right now, but for those getting swept up in the risk-on mood it’s worth noting the gamblers’ mantra: “No crying in the casino.”
The phrase, used by Chamath Palihapitya late Monday as the Silicon Valley investor
launched a new special purpose acquisition company (SPAC), is a warning to investors going all-in on high-risk assets.
Now the Federal Reserve looks set to start cutting rates, the signs of market exuberance are everywhere. The meme-stock frenzy first seen in 2021 has reappeared, IPOs are flourishing, cryptos are in vogue, and SPACs—blank-check investment vehicles that thrived
during the Covid-19 pandemic—seem to be back.
Investors seeking to buy into optimism around the positive meetings between President Donald Trump and Ukraine leader Volodymyr Zelensky channeled their energies into a newly formed SPAC rather than the broader market, which didn’t react.
Ukraine’s largest mobile operator, Kyivstar Group, went public on Friday via a blank-check merger. Its shares, which trade under the ticker KYIV, surged 17% on Monday.
Lessons from history suggest this is a time to be cautious. The same speculative assets boomed straight after the pandemic—marking the top of the so-called everything bubble, which burst as soon as the Fed started hiking rates in early 2022.
The casino reference should be a stark warning. Those who continue to roll the market dice must be prepared to take the
consequences.
—George Glover
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CONTENT FROM: Columbia Threadneedle Investments
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Strategic scenarios for bond investors
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For fixed-income investors, the primary driver of returns in the first half of the year was policy uncertainty. Our head of fixed income discusses why a research-based approach is needed to position portfolios for the second half of the year.
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Trump’s Possible Next Move: Host U.S., Russia, Ukraine Talks
There was an upbeat tone to the White House meeting among European
leaders, Ukraine President Volodymyr Zelensky, and President Donald Trump, who left the group late in the afternoon to call Russia’s President Vladimir Putin as he tried to hammer out the outlines of a peace deal to end the war in Ukraine.
- At the top of the agenda was deciding who will do what in terms of security guarantees for Ukraine. European Commission President Ursula von der Leyen referred to terms that were “Article 5 like,” a nod to the North Atlantic Treaty Organization’s provision that an attack against one member is an attack against all.
- That doesn’t mean that Ukraine would be offered membership in the alliance, something Trump said Sunday is off the table but that Ukraine has sought. Instead it involves a “credible Ukrainian army,” France’s President Emmanuel Macron said. Backing from Europe and the U.S. was under discussion at the meeting.
- Several leaders in attendance, including Macron and German Chancellor Friedrich Merz also made an appeal for a cease-fire or truce before a formal peace agreement was put in place. Trump has played down the likelihood of that since meeting with Putin in Alaska on Friday.
- The talks have given an unexpected lift to the stock of Kyivstar Group, Ukraine’s largest mobile operator that went public on the Nasdaq Friday through a blank-check company merger. Rising
17% on Monday, the stock emerged as a trendy play for retail investors looking to bet on a peace deal.
What’s Next: Zelensky said he is ready for a trilateral meeting between the U.S., Russia, and Ukraine, which
would be the next step in ending the war in Ukraine. Trump said he favored the idea, but the Kremlin didn’t commit to leadership attending one after Trump spoke with Putin.
—Anita Hamilton, Nate
Wolf, and Liz Moyer
Winklevoss Twins Jump Into Hot IPO Market With Gemini Filing
Gemini Space Station, a crypto exchange and
custodian bank founded by Bitcoin billionaire twins Cameron and Tyler Winklevoss, is the latest crypto firm to file plans for an initial public offering, hoping to ride the financial world’s two very hot waves for Bitcoin and IPOs.
- Gemini plans to list on the Nasdaq Global Select Market as “GEMI,” but its filing didn’t say how many shares it plans to sell or the price range targeted for the stock. It follows last week’s trading debut by crypto exchange Bullish and the June IPO of Circle Internet.
- Investors are flocking to crypto and IPOs in a bet on lower interest rates, which tends to make riskier assets more attractive relative to bonds. Bitcoin surged to a new high above $124,000 last week amid this optimism, though it has drifted back to $116,000 as of Monday.
- According to its latest financials, Gemini’s revenue dropped 7.6% in the first six months of this year, and it had net losses of about $282.5
million. But Gemini ended the first half with 523,000 monthly transacting users, up 5.7% from a year ago. Trading volume skyrocketed nearly 50%.
- The IPO market emerged from hibernation this year, with recent listings by design-software developer Figma, medical-imaging company Heartflow, space-exploration firm Firefly Aerospace, and drone maker AIRO.
What’s Next: It isn’t clear when Gemini will begin trading. But crypto firms Grayscale and BitGo have filed
confidentially for IPOs with the Securities and Exchange Commission, and Kraken, Fireblocks, and Chainalysis could file later this year or in 2026.
—Paul R. La Monica and Janet H. Cho
Palo Alto Networks Issues Rosy Guidance
Cybersecurity software maker
