👀 The next cryptos to watch

What’s going on here?

Apple made plans to integrate Google’s Gemini AI engine into its smartphones, a deal that could make iPhones sharper than ever before.

What does this mean?

Apple’s investors have been hoping for an AI breakthrough worthy of the company’s signature launch events. So far, though, the firm hasn’t revealed anything worth lining up for – and now, it’s considering fitting out iPhones with Gemini. Apple will be hoping investors respect the innovation, no matter whose name is on the patent: the stock’s down over 6% this year, its worst performance against the Nasdaq 100 index at this time of year in over a decade. Google’s investors won’t mind the collaboration, of course. The deal would be Gemini’s highest-profile partnership to date – so long as Apple doesn’t sidle up to another competitor like OpenAI before signing the dotted line.

Why should I care?

For markets: Stick to the status quo.

David Ricardo’s “comparative advantage” theory argues that firms should focus on what they do best and delegate the rest. If you buy that, Apple’s move is more shrewd than sluggish. So sure, Apple has problems: iPhone sales are losing their pace, electric vehicle blueprints are essentially in the trash, and regulators are donning their reading glasses. But with a spotless record of keeping profit in check and innovating when it’s least expected, it’ll probably take a lot more bad news for top investors to ditch their Apple a day.

The bigger picture: Forget the headlines.

AI-obsessed investors have sent Magnificent Seven stocks to the front of the pack. So now that the obvious picks have quite the price tags, Goldman Sachs’ best advice is to check out companies that are expected to use AI to better their books, rather than the ones churning out new high-tech products. That means pulling your eyes away from the likes of Nvidia and Meta, and taking a look at less flashy options like Walmart, Kohl’s, or Accenture.

What’s going on here?

Global investors’ plans to revitalize Samsung C&T fizzled out, suggesting that South Korea’s aim to install some new habits across the country’s boardrooms hasn’t quite kicked in.

What does this mean?

Activist investors buy enough shares in a company to earn them sway in the boardroom. Case in point: a Norwegian oil fund and Canadian pension powerhouse have been trying to push Samsung C&T – the construction and engineering company that owns the smartphone firm of the same moniker – to bump up dividends by 75% and buy back around $375 million worth of shares. But at the general meeting last Friday, shareholders backed the board of directors’ existing plan, despite both local and global experts advising them to vote with the activists. No surprise, really, when the Samsung Electronics chairman indirectly lays claim to 50% of the votes. That didn’t go down well with investors: Samsung C&T’s stock fell by 10% after the news.

Why should I care?

Zooming out: So much for a makeover.

South Korea might be home to world-famous conglomerates like Samsung and Hyundai, but the country has still been held back by the so-called “Korea discount”. On paper, even the biggest South Korean companies are worth some 20% less than their international rivals, so the government launched the "corporate value-up program". That should get shareholders more bang for their buck – but the Samsung vote hardly signals the start of a stock market makeover.

The bigger picture: Japan 2.0.

South Korea’s playbook is essentially a redraft of Japan’s, which saw the country’s formerly lagging stock market become one of the world’s biggest. So theoretically, savvy investors could buy South Korean companies for cheap today and wait for the reforms to touch up their returns. That said, it took Japan a decade to scrub up its stocks, and with South Korea’s plan already under scrutiny for its lack of detail, investors could be waiting a while.