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In today’s edition,
- AI disrupts search
- Manufacturing over listing
- Middle East expansion
- Revenue up, profit down
Market Snapshot
U.S. stocks ended the week mixed but largely stable, with trade optimism helping offset early losses. The Nasdaq rose 0.63% to 17,928.92, the S&P 500 edged up 0.08% to 5,659.91, and the Dow gained 0.18% to 41,249.38. Small- and mid-caps continued their outperformance for a fifth straight week.
Markets started soft, snapping the S&P’s nine-day winning streak, but recovered midweek on reports of U.S.-China trade talks and a new U.S.-UK deal, boosting hopes of tariff relief.
The Fed held rates steady at 4.25%–4.50%, with Chair Powell signaling a “wait and see” stance amid growing economic uncertainty. While services activity expanded (ISM Services PMI at 51.6%), rising prices (index at 65.1%) and weak manufacturing kept inflation and growth concerns alive.
Overall, investors balanced cautious Fed signals with trade optimism and patchy data to end the week with modest gains.
Stock market closing data for the week of May 5th to May 9th, 2025
News Summaries
Alphabet shed $138 billion in market value this week as shares dropped 6.2%, bringing the year-to-date decline to 19%, after Apple disclosed plans to integrate AI tools like ChatGPT and Claude into Safari, directly challenging Google’s dominance in search. Apple’s Eddy Cue revealed that Safari search queries fell for the first time in April, raising fresh concerns that Google’s $20 billion annual deal to remain the iPhone’s default search engine could be at risk. While Alphabet still commands 89.7% of global search share as of March (down from 92.9% in Jan 2023), investor confidence is shaking, especially with the stock now trading at just 15x forward earnings, well below Microsoft’s 30x. Analysts remain largely optimistic, but as AI-driven habits shift and paid clicks potentially weaken, Alphabet’s core engine is being tested. This isn’t a collapse, but it’s the clearest signal yet that the moat around Google search is narrowing.
LG Electronics is investing $600 million in a new factory in Andhra Pradesh over the next four years. This will be its third plant in India, even as it has paused its $1.5 billion IPO due to market volatility. The factory will start making air conditioners in 2025. It will also produce washing machines, fridges, and compressors by 2029. This move highlights India’s role as a growth market and a manufacturing hub for LG’s global strategy. Domestic demand for white goods is rising, with air conditioner units expected to reach 240 million by 2030, up from 93 million in 2023, according to IEA estimates. While the IPO is on hold, LG is focusing on long-term capacity. Rising temperatures and incomes are changing household consumption patterns. In the end, investing in a factory may provide more certainty than relying on market trends.
Disney is building its seventh global theme park in Abu Dhabi. This marks a key shift as the Middle East grows as a tourism and entertainment hub. The UAE aims to attract 39 million visitors by 2030, up from 24 million in 2023. A government push to diversify beyond oil supports this goal. Yas Island already hosts SeaWorld, Ferrari World, and Warner Bros., making it a tested location. For Disney, the Middle East offers close access to untapped markets like India. Flights to Abu Dhabi take under four hours, which helps reduce the risk of competing with existing parks. The new park will combine indoor and outdoor attractions to handle heat and dust. It will also use technology to cater to regional preferences. While past efforts in Dubai have struggled, Yas Island’s model appears more robust. Disney’s investment here focuses not just on visitor numbers, but on becoming the main brand in a region changing its tourism story from the ground up.
From the World of Crypto
Coinbase pulled in $2 billion in revenue this past quarter, a solid 24% jump over last year. But here’s the catch: profit dropped off a cliff.
Net income came in at just $66 million, down 94%, largely because Coinbase had to mark down the value of its crypto holdings as prices swung wildly. The market didn’t love that and shares fell 2% after hours and are already down 20% for the year.
So, what’s working? User engagement.
The platform clocked its second-highest monthly active user count. And these aren’t just one-click traders as more are using Coinbase’s full suite, from staking to subscriptions. Revenue from its cut of USDC stablecoin earnings rose 32% to $298 million, even though falling interest rates kept the upside in check.
Coinbase isn’t just depending on sentiment anymore. It’s shifting gears. The big move: acquiring Deribit for $2.9 billion, the largest crypto M&A deal to date.
With $1.2 trillion in trading volume last year, Deribit gives Coinbase a real shot at dominating the crypto derivatives space, not just spot trading. And that’s not all as Coinbase is piloting a program that allows businesses to send and receive payments in stablecoins, trying to make digital assets more useful in the real world.
All this is happening while Bitcoin flirts with $100,000 again, rebounding from a dip triggered by global tariffs and macro uncertainty. Regulatory winds are shifting too. Trump-era crypto friendliness has brought some relief, but attempts to push through stablecoin laws just hit a wall in the Senate.
Coinbase is clearly trying to grow up as a business and less about the hype, more about building steady revenue lines. But it’s still tied to a market that can move 20% in a week. The Deribit deal and stablecoin utility push are big plays. If they work, Coinbase might start looking a little less like a momentum trade and a bit more like a long-term infrastructure bet in crypto.
