Silver banana goes to…

In this issue of the peel:

• 🌪 New quarter, same market drama—tariffs, bond yields dropping, and a not-so-fun ride for global indices.

• 📈 AI fintech and semiconductors shine, while Rocket Companies' acquisition flops and biotech stocks take a hit.

• 💰 CoreWeave’s IPO stumble—what it says about tech startups going public in today’s volatile market.

Market Snapshot

Banana Bits

• The S&P dipped to a 6-month low and ended in the green all in one day.

• The cat fight between Trump and Putin is intensifying.

• Marine Le Pen was convicted of embezzlement and banned from running for office in France.

• Richmond Fed President Barkin spoke for all of us when he said, “Consumers are tired and frustrated.” 

• Here are the 15 countries on Trump’s list that he’ll be targeting for tariffs in the short-term.

The Daily Poll

Previous Poll:

Is Google’s Wiz acquisition a genius move or just overpriced hype?

Genius—cybersecurity is king: 25.7% // Overpriced—Google overpaid: 34.8% // Regulators might kill it: 12.0% // Just another Big Tech power grab: 27.5%

Tilt the Odds in Your Favor

In the competitive world of high finance, every advantage counts. Our exclusive curriculum, designed by industry experts, sharpens your skills and knowledge, making you a top candidate.

Enjoy personalized coaching, targeted internship opportunities, and a robust network of finance professionals with WSO Academy. 

» Apply Now «

Macro Monkey Says

Whirlwind of a Quarter

April 1 marks the beginning of a new quarter, which means we can all move forward with hope and optimism that we don’t get a repeat of Q1. 

For those of you who have deleted your banking apps and are refusing to even look at your portfolio these days, I understand. But for those who are brave enough to dissect what happened last quarter, let’s get into it. 

Let’s say the obvious part out loud. Global markets are facing significant turbulence as concerns over new tariffs have led to heightened volatility. President Trump’s announcement and actual follow-through of tariffs on imports have sparked fears of a trade war. 

Most people thought that he would use tariffs as a negotiating tactic, similar to 2016. But now that people realize this guy might be serious, markets have gone into panic mode. 

Within the US, fear can be seen not only in the equity market, with the NASDAQ and S&P down 10.3% and 4.3% respectively, in just the last 3 months, but also in the treasury markets, where bond yields are being driven down.  

This signals a shift toward more conservative investments. With fears of a potential downturn, demand for US government bonds has surged, causing yields to decline, which is often a sign that investors are seeking the safety of low-risk assets. 

The yield curve inversion, where short-term yields exceed long-term ones, has also sparked worries of an impending recession, as this has historically been a reliable recession indicator. 

According to Goldman, recession odds have increased to ~35% and are continuing to go up across the street. The only safe space in the US right now seems to be Gold, which has rallied hard while the world falls apart.

The impact on global markets has been pretty rough as well. Japan’s Nikkei index was also down about 10% at the start of the year and had officially entered correction territory. 

China has also traded down a bit, though not as badly as the US. The only bright spot has been Europe, where the FTSE 100 and Euro Stoxx 50 are up 3.9% and 6.7% YTD, respectively. 

The Takeaway?

While the short-term outlook remains shaky, some analysts believe these tariffs could be part of a broader strategy to renegotiate trade deals, possibly leading to more favorable terms. 

However, in the interim, markets will likely remain volatile, with treasuries and other safe-haven assets continuing to play a central role as investors adjust to the shifting economic risks.

Career Corner

Question

Should I ever network with current/former CEOs/CIOs/etc?

Answer

Yes!

Head Mentor, WSO Academy

Check out WSO Academy

What's Ripe

Micro Algo (MLGO) 39.8%

• Micro Algo is up big after landing a big investor (WiMi Hologram), which upped its stake recently. Micro Algo is focused on AI for the fintech space. The investment is seen as a positive move because it gives WiMi control over a company with strong growth potential in the AI and fintech sectors. WiMi can integrate its technology with MLGO to enhance both companies’ product offerings.

United Microelectronics (UMC) 9.2%

• ​United Microelectronics shares are up on reports that the company is exploring a merger with GlobalFoundries, which is a massive US-based chip manufacturer. The potential merger would create a massive U.S.-based semiconductor firm with a global manufacturing footprint across Asia, the US, and Europe. Combined, the two companies would become an industry leader in the space and could become a real threat to competitors and global semiconductor players like Taiwan Semi.

What's Rotten

Rocket Companies (RKT) 7.4%

• Rocket Companies just announced a $9.4 billion acquisition of Mr. Cooper, and investors had the exact opposite reaction of what the company had hoped. For Rocket, the deal should drive higher loan volume and build long-term client relationships to increase revenue. Investors don’t seem to be bought in on that vision just yet.

Biotech stocks

• Biotech stocks got absolutely killed after a top FDA official resigned. Dr. Peter Marks was a central figure in getting key vaccines and therapies approved. Since RFK became the head of Health and Human Services, the two have had internal disagreements. In his own words, he’d rather quit than deal with RFK’s “misinformation and lies”

Thought Banana

The Cost of Doing Business

CoreWeave's IPO is a case study for tech startups on exactly what not to do when going public. The first step is not to bring an AI company public when AI stocks are getting destroyed and no investor wants anything to do with them.

The second step is to make sure it comes at a price that is attractive to investors. Seems simple enough.

The company marketed its relationship with Nvidia as much as it could, but investors didn’t care. They initially tried to go out with a price range of $47-$55, implying a valuation north of $30 billion. After a week of no takers, the company adjusted and reduced the price range. Still no takers.

Ultimately, they ended up pricing the deal at $40 and raised half of what they had originally hoped for. Even with the reduced valuation range, the market still wasn’t impressed, and the stock closed flat to end the day after trading down almost 3%.

The broader market, especially technology, was getting absolutely hammered, so the company was already being aggressive by wanting to go public in this environment. Perhaps it was the fact that the founders needed a liquidity event to sell all their shares?

Key Takeaway

For the biggest IPO of the year, Corweave’s debut ended up being a disappointment.

Leveraging its relationship with Nvidia couldn’t overcome market dynamics and the negative sentiment of tech stocks right now. After cutting the deal size and price multiple times, investors still passed on it.

The Big Question: Should tech startups reconsider IPO timing in volatile markets, or is there never a "perfect" time to go public?

Banana Brain Teaser

Previous

If y is the smallest positive integer such that 3,150 multiplied by I is the square of an integer, then y must be?

Answer: 14

Today

If [x] is the greatest integer less than or equal to x, what is the value of [-1.6] + [3.4] + [2.7]?

Send your guesses to [email protected]

How Would You Rate Today's Peel?

Happy Investing,
Chris, Vyom, Ankit & Patrick

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