Apollo and Blackstone’s $35bn AI bet is a buy signal.

Transcript

Tom Markets are throwing around thirty-five billion dollars for AI chips — and that's just one deal. If you're not paying attention to private credit and semiconductors, you're missing the real AI trade.

Marie Good morning and welcome to Investment Flash, London Edition for June ninth, twenty twenty-six. I'm Marie, with Tom and Gerald. Today, Apollo and Blackstone have put a price tag on AI infrastructure — and it's massive.

Tom The FT reports Apollo and Blackstone co-led a thirty-five billion dollar financing for Anthropic's chip needs. That is the biggest private credit fundraise of its kind. Buddy, that's a fee-income jackpot for Apollo and Blackstone — and it's a screaming buy signal for the semiconductor ETF SOXX.

Gerald Tom, SOXX is already up eighty-two percent year to date and flirting with all-time highs. This isn't some undiscovered gem — it's a crowded trade. But I'll give you this: Apollo and Blackstone themselves are beaten down, Apollo down nineteen from its high, Blackstone down forty. If this deal kicks off more, there's genuine recovery potential.

Marie And it's not just fee income — it's structural validation. Private credit is stepping into a gap that banks can't fill for AI infrastructure. That's a long-term trend I like. So yeah, I'm with Tom on the buy signal for Apollo and Blackstone.

Tom See? Gerald, you can't deny the flow. Blackstone at a forty percent discount — that's not just recovery, that's a re-rating if they pull this off.

Gerald Alright, alright — I'm not fighting the fee stream.

Marie Exactly.

Tom One hundred percent.

Tom And it's not just chips — the FT also says OpenAI filed for an I P O that could value the company north of one trillion dollars. That's the biggest tech listing in years, and it's a direct benefit to Microsoft and Nvidia.

Gerald Microsoft sitting twenty-six percent below its fifty-two week high with a twenty-one times forward price-to-earnings ratio — for a company that owns a big chunk of the most important AI company on the planet. That's actually a value entry, which is weird to say about Microsoft.

Marie Hold on — the I P O process takes months, and lockups will exist. But you don't need the shares to pop on day one; the mere filing signals the whole AI space is monetizing. Nvidia at sixteen times forward earnings still looks cheap relative to the trend.

Tom Right, and remember, Microsoft isn't just an investor — they integrate OpenAI into every product. This I P O could be a catalyst for the entire AI ecosystem. I'm buying Microsoft here without hesitation.

Gerald Tom, you'd buy a GPU-shaped potato if it had an AI sticker.

Tom Only because you'd be selling it as a value play — 'peeled potato at a fifty percent discount'.

Marie Okay, okay — but genuinely, the Microsoft multiple is compelling. That's not hype, that's math.

Marie But let's get to the pushback. BofA warns the S&P 500 is an overconcentrated Big Tech bet that's run its course, and they say rotate into defensives like utilities.

Tom They say that every quarter. Look, the S&P 500 ETF is three percent off its high, the Nasdaq 100 four percent — that's not a top, that's a slight pullback in a bull trend. And tech isn't expensive — Microsoft at twenty-one times, Nvidia at sixteen times.

Gerald Yeah, but the concentration risk is real. Five stocks driving the entire index. If money flows out, the whole thing drains. And defensives like the utilities ETF XLU are down nine percent from their highs, up less than one percent year to date — unloved, but suddenly interesting if the rotation hits.

Marie I'm going to push back on both of you, actually. The rotation call is premature without a macro catalyst. A dovish Fed after C P I on Wednesday could break tech's hold, or it could keep the party going. Until then, the crowded trade stays crowded.

Tom Exactly — and that catalyst hasn't arrived. So I'm holding my tech longs. But Gerald, I see you eyeing XLU.

Gerald It's a hedge, Tom. Some of us like to sleep at night.

Gerald And speaking of things that keep me up — MarketWatch highlights a looming Pacific climate shock that could drive up global commodity prices and stoke inflation.

Tom So buy gold. The gold ETF GLD is flat year to date and twenty-two percent below its high. That's a laggard inflation hedge that hasn't woken up yet. I love that setup.

Marie Wait — oil is already up ninety-six percent year to date and near highs. That's a crowded bull trap if the supply disruption story fizzles. But gold? That's the underappreciated insurance policy here.

Gerald Exactly. Broad commodities DBC up thirty-two percent year to date, but gold hasn't moved. If the inflation scare intensifies, gold has a lot more catching up to do. And it's not like it's a novel thesis — it's just delayed.

Tom So we're all on the same page? Buy gold, fade the oil hype.

Gerald Yep.

Marie Yep.

Marie But here's a structural risk I'm worried about — and it's my most original take today. Nikkei Asia reports Japanese entertainment stocks face AI disruption. Nintendo down twenty-seven percent year to date, fifty-one below its high; Sanrio has crashed eighty-three percent year to date.

Tom Nintendo at fifty-one percent off its high? That's not a dip, that's a crack in the business model. AI-generated content could really devalue their character-driven IP.

Gerald Sanrio down eighty-three percent? At that point you're not catching a falling knife, you're picking up the handle after the blade broke off.

Marie Calling a bottom there isn't contrarian, it's gravitational defiance.

Tom Ha — fair enough. But look, the clear trade is short the most vulnerable, and Nintendo and Sanrio are broken stories. Hold Sony though; its diversified businesses might cushion the blow.

Gerald Agreed. Short them, but Sony's not a clear short.

Gerald And another bearish setup: Nikkei Asia reports global airline profits projected to drop by half as jet fuel costs soar. The airline ETF JETS is only down two percent year to date — way too sanguine.

Tom But Gerald, Delta Air Lines is up thirteen percent year to date and trades at just nine point seven times forward earnings. A lot of that pain might already be factored in.

Marie Maybe, but profit warnings have a way of crushing multiples further. However, I'm cautious on the long oil side of this trade — USO up ninety-six percent already. So the cleanest expression might not be short airlines and long oil. I'd rather pair it with something like Prologis.

Tom Oh, good lead — let's get to the REITs. But first, Nippon Steel.

Tom Nippon Steel plans to invest up to two and a half billion dollars in US Steel's Pennsylvania complex. That's a huge vote of confidence in US industrial demand.

Gerald And the stock, ticker NPSCY, is down fifteen percent year to date near fifty-two week lows. Could be a value play if this expansion works. The steel ETF SLX is up twenty-three percent year to date too.

Marie Wait — Nippon Steel investing in US Steel after all that political noise last year? That's a statement. It might even signal resolution to some trade frictions.

Tom Exactly, and US Steel directly benefits. This is a solid industrial uptrend play.

Tom Meanwhile, China's solar panel giants are bleeding red ink on oversupply. JinkoSolar down thirty percent year to date, Daqo down forty-eight percent.

Marie That's a structural overcapacity crisis. Short the direct names — JinkoSolar and Daqo. The solar ETF TAN is up twenty-three percent, but that's probably because it's heavy on non-China names. Eventually the glut drags the whole sector.

Gerald Right, so short JinkoSolar and Daqo, and maybe even lighten up on the solar ETF before the contagion spreads.

Tom Agreed. No place to hide in that glut.

Tom Gerald, yesterday you were already watching Blackstone. Now they're selling a two billion dollar bond deal backed by private fund stakes — that's exactly the catalyst or coffin we were waiting for.

Gerald Yeah, I said watch Blackstone. It's forty percent off its high. If this deal flies, it signals liquidity and confidence in private equity; if it struggles, it could trigger a much broader credit spread warning. So still watching.

Marie No one is talking about credit spreads, but this deal tests the exact plumbing of private equity liquidity. If it fails, financials could catch a cold.

Tom Alright, so no buy yet — just watch. But if it works, that's a massive buy signal for Blackstone. Noted.

Tom Now, Marie teased it — Prologis, the data center REIT, and Simon Property, the mall owner, are bucking real estate headwinds according to Josh Brown on CNBC. Both near fifty-two week highs.

Gerald Prologis is up eleven percent year to date, just four percent off its high — and it's a direct AI beneficiary through data centers. That's your infrastructure play without buying chips. Simon Property is up thirteen percent — consumer resilience, but I'm a bit more skeptical on malls long term.

Marie That's exactly my thinking. Prologis is the clean AI REIT play — I'd pair it as a long against something like jet fuel costs. Short the airline ETF JETS, long Prologis. That's the pair trade that captures the AI infrastructure boom while hedging the inflation scare.

Tom I love that pair. It's not just a hedge, it's two trades that make sense independently.

Gerald Alright, that's clever. Long Prologis, short JETS. I'll drink to that.

Tom Quick one — a Korean leveraged ETF, ticker KORU, jumped fifty percent even as its underlying SK Hynix slumped. It's up two hundred forty percent year to date on these erratic moves. That's not an ETF, it's a slot machine with a Seoul backdrop.

Marie Retail investors are going to get wrecked when the music stops. If regulators step in, that product could implode. Short if you can stomach the volatility.

Gerald Two hundred forty percent year to date? That's a regulatory target waiting to happen. Short.

Gerald And finally, the RBI ramped rupee defense to a record before government measures. The rupee is under severe pressure — short the pair, INR versus USD.

Marie The India ETF INDA is down fourteen percent year to date, but with government support it might stabilize. Hold until direction clears. But the rupee trade is straightforward.

Tom Yep. Intervention just delays the inevitable. Short rupee.

Marie So our most original take today: AI is coming for Japan's entertainment icons, and the market has largely ignored the structural risk while those stocks cratered. That's the Nikkei piece.

Tom And yet, the day's biggest theme is that Apollo and Blackstone are doubling down on AI chips, OpenAI is going for a trillion-dollar I P O — AI infrastructure is not a bubble, it's a buildout.

Gerald But BofA waves red flags. This market can't decide if AI is a secular growth story or a crowded trade rolling over. Our view is that the AI trade is no longer monolithic — winners are being chosen, not bought wholesale. Microsoft at twenty-one times earnings is cheap, Nvidia at sixteen times is cheap, but the semiconductor ETF at eighty-two percent year to date? That's priced for perfection.

Marie Exactly. The clean expression isn't one ticker — it's the pair trade I mentioned: long Prologis, short the airline ETF JETS. That captures infrastructure without buying the top of semiconductors, and it hedges the inflation scare from commodities.

Tom Or if you think the commodity story is overcooked, short USO. It's up ninety-six percent year to date — that's a crowded bull trap waiting to spring.

Gerald And watch that Blackstone bond deal closely. If credit spreads wobble, the whole risk appetite shifts.

Marie Right — credit spreads are the missing piece in the narrative. But overall, the AI infrastructure buildout is real, and private credit is fueling it. That's our buy signal.

Tom As always, none of this is investment advice — it's just our daily digest of what's moving markets. Do your own homework.

Marie That's it for the London Edition. We're back with the New York Edition later today at nine a.m. New York time. If you're just finding us, hit follow on Spotify or check investmentflash.com for the full digest with charts and sources. I'm Marie.

Tom Tom.

Gerald And Gerald. See you in New York.