Welcome to this week’s Market Pulse, your 5-minute update on key market news and events, with takeaways and insights from the Sidekick Investment Team.

Today, we’re looking at Trump’s push for semi-annual earnings, Microsoft’s investment in the UK, and Oracle’s share price rally. 

But first, our number of the week…

50 basis points

That’s how much Fed governor Stephen Miran, recently appointed by Donald Trump, voted to cut US interest rates by this week. The Fed ultimately agreed on a smaller, 25-basis-point cut.

Sidekick Takeaway: While Miran was the only member of the Fed board to push for a larger cut, his vote indicates a potential fractious future for the central bank. If Trump succeeds in nominating other governors to the board, rates could fall far faster than markets anticipate.

Only have a minute to read? Here’s the TL;DR:

• Donald Trump proposed moving US corporate earnings reports from a quarterly basis to a semi-annual one. While supporters argue that this could encourage long-term planning, critics warn of reduced transparency and less timely corporate guidance.
• Microsoft announced plans to deploy over 23,000 GPUs in Northeast London as part of a $42 billion 'Tech Prosperity Deal' during Trump's UK visit. The partnership could help drive increased employment, though some view the deal as leverage to pressure the UK into dropping its digital services tax.
• Oracle's share price surged following guidance projecting 700% revenue growth, briefly making co-founder Larry Ellison the world's richest person. While the firm’s valuation raises bubble concerns, Oracle's price reflects not just AI hype but also Ellison's proximity to Trump's dealmaking.

It’s important to note that the content of this Market Pulse is based on current public information which we consider to be reliable and accurate. It represents Sidekick’s view only and does not represent investment advice - investors should not take decisions to trade based on this information.

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The Corporate Calendar: Trump Pushes for Semi-Annual Earnings 

Across the world, public firms are required to file regular reports for shareholders disclosing their financial performance. 

In the US, this has historically taken place on a quarterly basis – four times per year. 

But if Donald Trump has his way, this pace could be cut in half. 

This week, the US President proposed that American firms disclose their performance just once every six months. The SEC, America’s chief financial regulator, is reportedly prioritising the push.

Supporters note that the move could help firms save on compliance costs and focus on long-term plans.

Others, however, have criticised what they see as a push for reduced corporate transparency. 

Semi-annual reporting: A new standard?

Trump’s push for reduced reporting might be less radical than it first seems. Many developed countries already require that companies release earnings just twice per year:

• The UK, Australia, and many EU countries use semi-annual reporting. The UK briefly introduced quarterly reporting in 2007, but switched back in 2014.
• Critics of quarterly reporting, like Trump, argue that they force managers to focus on short-term profits over long-term growth.
• These criticisms have grown louder as regulatory requirements have increased in recent years, making quarterly reporting more expensive.

According to academic evidence, however, semi-annual reporting may not make a meaningful difference in pushing CEOs toward long-term investment. 

As such, this new standard could lead to reduced corporate transparency for little appreciable benefit. 

Sidekick Takeaway: One under-appreciated consequence of losing quarterly reporting would be less timely information on the path of the US economy. Corporate guidance during earnings reports has historically been a source of valuable information on the world’s largest economy.

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GPU-K: Microsoft Unveils Record British AI Investment

This week, US President Donald Trump wrapped up an official state visit to the UK.

Trump’s time in the UK featured bilateral meetings with PM Keir Starmer and a reception with the Royal Family.

Perhaps most consequentially, however, was a massive joint technology deal featuring up to $42 billion in investments.

The so-called ‘Tech Prosperity Deal’ covered areas including AI, quantum computing, and nuclear energy.

While several US firms will make significant investments in the UK, the deal was headlined by Microsoft’s pledge to create one of Britain’s largest supercomputers.

Microsoft to deploy over 23,000 GPUs in the UK

In conjunction with Nvidia and Nscale, Microsoft plans to deploy roughly 23,000 GPUs in the UK over the coming years. 

The chips will go toward creating a massive supercomputer in Northeast London.

And Microsoft isn’t the only firm making significant commitments. Google is also planning to build a new data centre worth some $6.8 billion.

These new tech deals could be a valuable source of job creation and investment in the UK, and help keep the ‘Special Relationship’ strong amidst trade tensions.

Nonetheless, such massive investments raise concerns about the UK’s dependence on foreign firms for tech development. 

Ideally, such deals will serve as a springboard to help spark greater domestic investment, supported by the public sector.

Sidekick Takeaway: Cynically, some have viewed the Tech Prosperity Deal as a quid pro quo to soften Starmer’s resistance to dropping the UK’s digital services tax. While Trump is leaving the UK without a formal DST reduction, negotiations over the contentious levy will doubtless resurface in the coming months. 

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Nothing in Excess: Oracle’s Valuation Sparks Bubble Fears

Oracle has long been known as a staid player within Silicon Valley. The firm is best known for its enterprise database software.

But in a surprisingly short span, that narrative has shifted. Now, Oracle is drawing attention as a potential AI winner.

This year, the company’s shares have climbed nearly 80%, one of the best performers in the S&P 500.

Following guidance indicating that revenue will climb an astounding 700% over the next three years, that rally accelerated further.

With Oracle’s shares trading near their valuation from the Dot-Com era, some investors fear a bubble. But could Oracle’s share price be justified?

Oracle: Not just an AI play

Much of Oracle’s recent investor attention is due to projected cloud computing growth.

This week, that attention briefly helped Oracle co-founder Larry Ellison become the world’s richest person.

But this AI focus overlooks some of the other drivers of Oracle’s current valuation.

Oracle has long been floated as a potential buyer for the US arm of TikTok. This week, reports indicated that Oracle would play a significant role in the looming deal, which could be a major new source of revenue.

Ellison is also known to be close to US President Donald Trump. Palantir and Tesla, two other firms associated with Trump-connected billionaires, have also drawn attention for their elevated valuations. 

Due to these factors, Oracle’s price cannot be understood simply as a result of AI hype – it also reflects Ellison’s proximity to Trump’s dealmaking.

Sidekick Takeaway: The preceding analysis shouldn’t suggest that investors are appropriately pricing AI firms across the board – the sector certainly has hints of frothy valuations. However, pointing to Oracle’s price as a sign of a bubble isn’t conclusive evidence either. 

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Notices

Sidekick Money Ltd is a company registered in England and Wales (No. 13882980). Sidekick Money Ltd is authorised and regulated by the Financial Conduct Authority (FRN 984829). Our address is 21-33 Great Eastern St, London, EC2A 3EJ.

𝘗𝘭𝘦𝘢𝘴𝘦 𝘳𝘦𝘮𝘦𝘮𝘣𝘦𝘳, 𝘪𝘯𝘷𝘦𝘴𝘵𝘪𝘯𝘨 𝘴𝘩𝘰𝘶𝘭𝘥 𝘣𝘦 𝘷𝘪𝘦𝘸𝘦𝘥 𝘢𝘴 𝘭𝘰𝘯𝘨𝘦𝘳 𝘵𝘦𝘳𝘮. 𝘠𝘰𝘶𝘳 𝘤𝘢𝘱𝘪𝘵𝘢𝘭 𝘪𝘴 𝘢𝘵 𝘳𝘪𝘴𝘬 - 𝘵𝘩𝘦 𝘷𝘢𝘭𝘶𝘦 𝘰𝘧 𝘪𝘯𝘷𝘦𝘴𝘵𝘮𝘦𝘯𝘵𝘴 𝘤𝘢𝘯 𝘨𝘰 𝘶𝘱 𝘢𝘯𝘥 𝘥𝘰𝘸𝘯, 𝘢𝘯𝘥 𝘺𝘰𝘶 𝘮𝘢𝘺 𝘨𝘦𝘵 𝘣𝘢𝘤𝘬 𝘭𝘦𝘴𝘴 𝘵𝘩𝘢𝘯 𝘺𝘰𝘶 𝘱𝘶𝘵 𝘪𝘯.

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