Stripe Wants PayPal 💸

Welcome back to the Day Trading newsletter 📈

The tape finally caught a break: a second straight day of cooling inflation data sent stocks higher Wednesday, Apple closed at a record, and the biggest fintech deal in years just landed on PayPal's doorstep.

Let’s get into it 👇️ 

🔻 IBM cratered 25% Tuesday (its worst day on record) after warning that second-quarter results fell short of expectations. The preliminary numbers: adjusted EPS of $2.93 vs. $3.01 expected, on revenue of $17.2 billion vs. $17.86 billion. CEO Arvind Krishna blamed clients abruptly shifting spending toward hardware like memory chips. Full results land July 22.

🔼 TSMC posted a record quarter Thursday morning (net profit jumped 77% to $21.99 billion) and announced an additional $100 billion investment in Arizona. Revenue rose 33.7% to $40.2 billion as AI-related demand hit 66% of sales. The world's largest chipmaker keeps proving the AI buildout is accelerating, not slowing.

⛽️ Wholesale inflation unexpectedly fell 0.3% in June, one day after the cool CPI report. Economists had expected the producer price index to be flat. A 12% plunge in gasoline prices drove about two-thirds of the drop. Back-to-back soft inflation prints strengthen the case for Fed rate cuts later this year.

🍏 Apple closed at a record $327.50 Wednesday, gaining 4% after Chinese regulators approved Apple Intelligence for the Chinese market. Alibaba confirmed its Qwen model will power the AI features on iPhones in China. Apple also captured a record 20% of global smartphone shipments in Q2 despite an industry-wide slump.

🛢️ Oil steadied Wednesday as US forces carried out another round of strikes against Tehran and Washington reinstated its naval blockade of Iranian ports near the Strait of Hormuz. WTI settled at $79.60 and Brent at $84.95, holding most of Monday's 9.4% spike even after President Trump abandoned his 20% Hormuz "reimbursement" fee.

💰️ Bitcoin topped $65,000 Wednesday, hitting a three-week high as cooling inflation revived risk appetite. Spot bitcoin ETFs pulled in over $180 million, with $139 million flowing into BlackRock's iShares Bitcoin Trust alone. The bounce follows crypto's worst month in four years, and sentiment remains in "fear" territory.

🥇 BlackRock's assets under management hit a record $15.34 trillion, up from $12.53 trillion a year ago. The world's largest asset manager earned $13.91 per share vs. $12.59 expected, hauled in $192 billion in net inflows for the quarter, and posted its best operating margin in nearly five years. Shares rose about 5%.

🏭️ ASML raised its 2026 sales forecast for the second time this year, now targeting €43–45 billion, up from €36–40 billion. The Dutch company (which makes the machines that make AI chips) posted Q2 revenue of €9.33 billion and plans to boost key chipmaking-tool capacity by 30% to meet demand.

Stripe and private equity firm Advent International have offered to buy PayPal for $60.50 per share, a bid worth more than $53 billion, backed by roughly $50 billion in committed bank financing.

PayPal shares went soaring Wednesday after Reuters broke the news, ending the day up 17% at $55.52.

The offer, made earlier this month after an initial approach in April, represents a 28% premium to Tuesday's close and would hand Stripe and Advent equal ownership of the company, with no plans to break it up.

PayPal hasn't responded yet, but its board is expected to meet as soon as July 20, and the company is working with Goldman Sachs and Evercore to weigh its options.

This is a story about how far PayPal has fallen, and how hungry Stripe has become.

PayPal was worth roughly $360 billion at its 2021 peak; this year its market cap bottomed near $36 billion as Apple Pay, Google Pay, and buy-now-pay-later apps chipped away at its checkout button.

New CEO Enrique Lores, who took over in March, is already cutting about 20% of the workforce. Stripe (privately valued at $159 billion) would instantly gain PayPal's hundreds of millions of consumer accounts, plus Venmo.

A tie-up of the two biggest independent online-payments players would also almost certainly draw an antitrust fight, since Stripe competes head-on with PayPal's Braintree unit and its Link checkout tool battles the PayPal button.

What to watch:

• The July 20 board meeting is the first real signal.

• Note that PayPal closed at $55.52 (well below the $60.50 offer) which tells you the market isn't convinced this deal gets done at this price, or at all.

• Watch for a sweetened bid, a rival suitor, or PayPal's bankers pushing alternatives like a breakup. If talks progress, expect a regulatory review measured in years, not months.

 RATE TODAY’S EDITION

⚠️ Disclaimer: Not financial advice. Do your research before making any trades.