Pre Market Thoughts - 18 Aug 26 Yields are higher across the curve with new highs in the 30Y at 5.3%. Across the index, we see Consumer staples suffering while Energy is up (See sector performance breakdown on http://terminal.gambit.zone under RADAR tab > SECTORS). Factor wise momentum and high beta has led a very strong rebound with a 7-9% MTD bounce (RADAR tab > ROTATION) In overnight US markets we had strong performance led by the memory sector while neoclouds were generally held down. We also saw a resumption of the semis up, hyperscalers down performance. The most consequential news was Anthropic releasing that its July ARR was at 65B+. For context at the end of May this was 47B, so a 40% increase in 2 months. Shortly after we see OAI announcing a 50% price cut for GPT 5.6 Sol on OpenRouter and Vercel. Semianalysis has rightfully noted that this is a "clever marketing ploy". Because "Openrouter and Vercel are disproportionately impactful because they are two of the main datasources everyone uses to estimate AI lab/model market share". I have been saying that Openrouter and Vercel ARE NOT indicative of the overall market at all. People use them because it is convenient. However, if you dropped your keys, do you only look for it near the lamp where there is light? Isnt it pretty stupid? Anyway, we can see that OAI sees the pressure and is gearing up all tricks to fight on perception. Meanwhile, users of Claude would realise that Anthropic is severely short on compute, with tasks not being completed or being swapped to a worse model mid way. The picks and shovels in this case is compute. Neoclouds. NEOCLOUD SUMMER. Asia markets followed the weakness in US indices with NKY dropping 2.5% and KOSPI dropping 1.55%. The more discerning reader would be surprised by the KOSPI number, however this is an optical illusion because the Korean markets were closed yesterday and hence the actual drop would have been somewhat closer to 4.5%. Memory took a hit with 285A giving back some gains and Hynix hovering at the 1.6m KRW support. The HK model companies were also not spared with $2513 down 12% and $100 down 5%. Is there real cause for worry? My opinion is no. Anthropic's growth has been phenomenal. While some people are disappointed and think the number should be 70B or 75B or 80B. At the end of the day, its all splitting hairs. Exponential growth will slow, the crux is at what ending ARR does Anthropic land at by the end of next year. Also new tool - Grok Bot has dropped - Gavin Baker thinks this is another "Claude Code" moment for AI. I will try it out and let you know. On the terminal now you can track how the money flows from the Hyperscaler Capex (DATA tab > SUPPLY CHAIN), you can also see it visualised where the bottlenecks lay and what part of the process is currently strained. Good luck!(degentrading)