Daily Commentary

MarketMinder’s View: Please note, as this piece mentions some specific firms, MarketMinder doesn’t make individual security recommendations, and any names cited here are coincident to the broader theme we wish to comment on. With the financial industry—and legislative initiatives—pushing wider adoption of private equity (PE), we think this is something for investors to be aware of: “Roughly a fifth of all PE sales this year involved groups raising money from new investors to acquire businesses from their older funds, up from 12-13 per cent the previous year, said Sunaina Sinha Haldea, global head of private capital advisory at Raymond James. Such transactions sell assets already owned by a PE group to so-called continuation vehicles—newer funds also managed by the firm. The tactic enables PE firms to return cash to investors in older funds, but has prompted concerns about potential conflicts of interest.” While we have nothing against PE per se, such practices deserve close scrutiny and underscore the extra due diligence those considering PE stakes must undertake to understand their investment—and potential returns. Like the article notes, “some backers of PE funds such as pension funds are concerned that in such transactions the same buyout firm is on both the sell and buy sides of a deal. Some investors fear firms could underplay the value of the assets being transferred, to the detriment of the original fund backers being offered an exit.” That is a potential blind spot worth being aware of, especially if investors rely on their managers to do the analyzing for them. As with any investment, it is critical to look past the hype and dig into the details to ensure you know exactly what you are buying.

MarketMinder’s View: Is AI the only pillar holding up the US economy and markets? “By one measure, more than 90 percent of economic growth in the first half of 2025 came from investments in computer equipment and software, which economists chalk up to projects linked to the rush to build data centers and remain in the A.I. race. Seven of the top 10 stocks in the S&P 500 this year were lifted by the bet on artificial intelligence. ... But those companies, despite their meteoric rise, didn’t have the biggest impact on the index. That honor went to ... the Magnificent Seven, that has driven the market higher in recent years.” (Since the article lists specific examples, please note MarketMinder doesn’t make individual security recommendations; they are incidental to the broader theme under discussion.) While we don’t dismiss Tech’s continued run, we think this overstates some things, and it is premature to call AI a bubble. For one, the article neglects to mention five of those seven have lagged the S&P 500 this year, undercutting the notion they are a collective Atlas shouldering the world. Then consider how America is also lagging non-US stocks this year, which further undermines the conventional wisdom AI is solely responsible for global market gains. A fuller picture shows a much broader and more diverse bull market than widely believed. Note, too, that fundamentally, Big Tech’s earnings and growth can support their valuations. Thinking AI alone is driving growth implies the rest of the global economy and markets are weak—a false fear and a brick in the wall of worry. For more, see our November commentary, “What to Make of AI Bubble Talk.”

MarketMinder’s View: “South Korea’s annual exports surpassed $700 billion for the first time on Monday, reaching the milestone seven years after the country first topped $600 billion in 2018, according to the Ministry of Trade, Industry and Energy and the Korea Customs Service. ... The government described the milestone as ‘qualitative growth’ achieved despite a tougher trade environment that included U.S. tariffs and wider protectionist policies. It said steady exports also helped support domestic growth and jobs during a period of weak local demand.” Record-high South Korean exports highlight a few points about global trade in 2025. One, 15% US tariffs (with semiconductors exempted) haven’t dented commerce overall, though bilateral trade with America is down year over year. Two, non-US trade is more than making up for the US’s “protectionist policies.” And three, as a major hub in the global tech-supply chain, demand remains robust. But that isn’t all: “... with automobiles and ships also among the main drivers. The government also pointed to growing shipments of consumer-facing products such as food and beauty items as additional sources of momentum.” This isn’t just about computer chips, as global trade is more resilient than many imagine.