Wall Street Breakfast Podcast: FTC To Probe Qualcomm Deal

Sign on Doorway for the Federal Trade Commission in Washington D.C.


Listen below or on the go on Apple Podcasts and Spotify

Deep FTC probe of Qualcomm (QCOM) auto-chip deal reportedly on deck for Wednesday. (00:32) VinFast (VFS) has the 3rd highest auto market cap – SA analysts say Sell while Wall Street is quiet. (01:35) Goldman Sachs (GS) said to urge staff to work from office five days a week. (03:09)

This is an abridged transcript of the podcast.

Qualcomm (NASDAQ:QCOM) is reportedly headed for a comprehensive investigation of its planned purchase of Autotalks.

Autotalks is an Israeli chipmaker focused on automotive safety.

Politico reported that the Federal Trade Commission has weighed a more advanced probe and it’s set to open that investigation on Wednesday.

The Autotalks deal is intended to shore up Qualcomm’s business focused on “V2X” or vehicle-to-everything communications

According to the Autotalks website, V2X enables vehicles to communicate with one another and their environment.

Such a probe would follow the announcement of a thorough review of the deal at the European Commission, which is concerned about combining two key suppliers of V2X chips to Europe.

According to the report, while Qualcomm and Autotalks had highlighted support from automakers and parts makers in announcing the deal, it faced anonymous complainants — one of which is MediaTek.

A lengthy probe could set Qualcomm’s deal back by months or even longer.

VinFast Auto Ltd. (NASDAQ: (VFS) closed on Tuesday with a monster 109% gain that pushed the market cap to over $90B. The closing price of $36.72 was still short of the high of $46.98.

Volume on VFS topped 18K shares for the session. Notably, the market cap on VinFast (VFS) trails only Tesla (TSLA) and Toyota (TM) in the auto sector.

The sizzling rally has defied expectations and is seemingly not tied to any fundamental analysis. While Wall Street analysts have yet to post any ratings on VinFast (VinFast Auto Ltd. (VFS) Stock Price Today, Quote & News), Seeking Alpha authors have warned on the frothy valuation.

On August 18, Seeking Alpha analyst The Asian Investor advised readers to sell the hype due to the unsustainable market cap. Seeking Alpha analyst Bill Maurer has also been a VinFast skeptic from the start. In an update on Tuesday, Maurer said the rally is a result of a low-float stock with high volatility, and the near $100 billion market cap does not justify the company’s growth prospects for the coming years.

VinFast (VFS) manufactures and exports a portfolio of e-SUVs, e-scooters and e-buses across Vietnam, North America, and, soon, Europe.

On July 28, VinFast broke ground for the construction of its electric vehicle manufacturing site in North Carolina, marking a significant step in its global expansion and the company’s supply chain development in North America.

Goldman Sachs (NYSE:GS) is ramping up its crackdown on employees who have yet to return to the office five days a week.

Bloomberg reported that Goldman’s head of human resources, Jacqueline Arthur said in a statement, “While there is flexibility when needed, we are simply reminding our employees of our existing policy. We have continued to encourage employees to work in the office five days a week.”

Megabank peers such as JPMorgan Chase (JPM) and Citigroup (C) have been urging staff to comply with their three-days-a-week guidelines.

Other headlines to look out for on Seeking Alpha:

Retail’s true crime story: Top execs say rise in theft is cutting into earnings

Manchester United jumps on report sale may be announced next month

U.S. lifts restrictions on 27 Chinese companies ahead of Commerce Secretary trip

On our catalyst watch for the day,

  • Twilio (TWLO) will hold its highly-anticipated customer and developer conference. Along with Twilio execs, OpenAI CEO Sam Altman will be one of the notable speakers. Twilio (TWLO) has been called out recently by some analysts as an AI play.

  • The annual Gamescom videogame fair will begin in Germany. Gamescom has featured notable software and hardware announcements in the past.

Wall Street’s major averages on Tuesday ended mixed.

The Nasdaq (COMP.IND) closed marginally higher by 0.06%. The S&P 500 (SP500) retreated 0.28%, while the Dow (DJI) slipped 0.51%.

Of the 11 S&P sectors, seven ended in negative territory. Real Estate, Utilities, Communication Services and Consumer Discretionary were the only gainers.

Financials was the top loser.

Market participants are looking ahead to NVIDIA’s (NVDA) results today.

For an NVIDIA preview, check out Tuesday’s Wall Street Lunch with Kim Khan.

Treasury yields continued to be in focus, with the recent bond sell-off easing slightly. The 10-year yield (US10Y) was down 1 basis point to 4.33%, while the 2-year yield (US2Y) was up 5 basis points to 5.04%.

Tuesday’s economic calendar was fairly light. July existing home sales fell more than anticipated. At the same time, Richmond Fed’s manufacturing survey for August was in-line with consensus.

Now let’s take a look at the markets as of 6 am. Ahead of the opening bell today, Dow, S&P and Nasdaq futures are in the green. The Dow is up 0.4%, the S&P 500 is up 0.5% and the Nasdaq is up 0.7%. Crude oil is down 1.4% at less than $79 a barrel. Bitcoin is down 0.1% at less than 26,000.

In the world markets, the FTSE 100 is up 0.9% and the DAX is up 0.5%.

The biggest stock movers for the day premarket: Apellis Pharmaceuticals (NASDAQ:APLS) is up 30% after the company stated that there is no proof of a link between the 19-gauge needle and rare incidences of retinal vasculitis, a kind of eye inflammation.

AMC Entertainment Holdings’ (NYSE:AMC) is down more than 10% on the threshold of a significant share conversion announced by the theater chain to generate more capital.

On today’s economic calendar, at 10am new home sales.

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