🤖 Is The Tide Turning For AI?

Good morning. US stock futures ticked lower in Wednesday morning trading as investors brace for more volatility in September, historically a weak month for equities.

🤖 US DOJ sets sights on AI industry players

📝 Our report: The U.S. Justice Department has subpoenaed Nvidia and others, ramping up its probe into whether the chip giant broke antitrust laws in its AI dominance. The DOJ, which had previously delivered questionnaires to companies, is now sending legally binding requests that oblige recipients to provide information, according to people familiar with the investigation. That takes the government a step closer to launching a formal complaint.

 🔑 Key points:

• Antitrust officials are concerned that Nvidia is making it harder to switch to other suppliers and penalizes buyers that don’t exclusively use its artificial intelligence chips, according to the people, who asked not to be identified because the discussions are private.

• As part of the probe, which Bloomberg previously reported in June, investigators have been contacting other technology companies to gather information.

• Nvidia has drawn regulatory scrutiny since becoming the world’s most valuable chipmaker and a key beneficiary of the AI spending boom. Sales have been more than doubling each quarter, and it’s eclipsed onetime chip leaders such as Intel Corp.

💡 So what: The U.S. Justice Department's decision to send subpoenas to Nvidia and other companies regarding their dominance in the AI space has significant implications. If the investigation uncovers antitrust violations, it could lead to stricter regulations, fines, or even forced changes in how these companies operate. This action signals increased scrutiny on major tech players in the AI industry, potentially affecting the broader tech market and sparking concerns over competition and innovation. Additionally, it may lead to legal battles that could impact Nvidia's market position and influence how AI technologies are developed and deployed across various sectors.

Wednesday - U.S Trade Deficit, Fed Beige Book

Thursday - U.S Productivity

Friday - U.S Unemployment Rate, New York Fed President Williams Speaks

📈 George Soros shares his top investing tips!

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🛍️ Chinese retail brands under scrutiny over safety concerns

WHAT: Two U.S. Consumer Product Safety Commission (CPSC) leaders are urging an investigation into Shein and Temu after "dangerous baby and toddler products" were found on their sites, according to a letter on the CPSC website. Shein and PDD Group's Temu, which both ship cheap merchandise into the U.S. from China, are raising "specific concerns" for the Commission for their use of de minimis, a rule exempting packages valued at $800 or less from tariffs if they are sent directly to shoppers.

WHY: Critics of Shein and Temu attribute low prices and de minimis to Shein and Temu's success in the U.S. Both companies have also come under scrutiny for the quality of their products.

🔨 SEC goes after credit ratings agencies

WHAT: The US Securities and Exchange Commission (SEC) has slapped six credit rating agencies with charges for "serious recordkeeping slip-ups." The agencies are Moody's Investors Service, S&P Global Ratings, Fitch Ratings, HR Ratings de Mexico, A.M. Best Rating Services and Demotech.

WHY: The SEC said the agencies acknowledged that their conduct violated recordkeeping provisions of federal securities laws and agreed to pay combined civil penalties of more than $49 million.

🏠 Airbnb lobbies NYC on short-term rentals

WHAT: Airbnb is urging New York City to rethink its September 2023 short-term rental regulations, arguing they hike prices for travelers and do nothing to improve the housing market. In a blog post, Airbnb said Local Law LL18, which states hosts must be permanent occupants of the units being rented and must register with the city before posting rentals, has "failed to combat the housing crisis".

WHY: Airbnb, citing data from Apartment List, said vacancy rates for apartments in New York City have remained virtually unchanged at 3.4% since the law took effect. Last year, a New York judge dismissed the company's lawsuit against New York City over the local law.

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