Trading Day for Thursday, June 25, 2026

Key Concepts

• Global Infrastructure: Essential services (water, power, internet, transport) acting as the backbone of the economy, currently trading at attractive valuations.
• Hyperscaler CapEx: Massive capital expenditure by tech giants (Microsoft, Amazon, Google, Meta) on data centers, projected to reach $700 billion in 2026 and over $1 trillion in 2027.
• Physical AI: The transition of AI from cloud-based processing to "the edge"—embedding intelligence into cars, robotics, and industrial automation.
• Memory Cycle: The shift from spot-price-driven cyclicality in semiconductor memory to long-term strategic customer agreements.
• Silver Tsunami: The demographic trend of 10,000 Baby Boomers turning 65 daily in the U.S., driving demand for senior housing.

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1. Global Infrastructure and AI Beneficiaries

Dennis Mitchell (Starlight Capital) highlights that global infrastructure is outperforming with lower volatility than broader equities.

• Valuation: Infrastructure stocks traded at a 20% discount to global equities earlier this year, compared to a historical 6% premium.
• Data Centers: Digital Realty and Equinix are identified as primary beneficiaries of hyperscaler growth. They are securing 20–25 year leases with minimal credit risk from major tech firms.
• Power/Energy: Data centers require massive power, leading to "captive power" solutions. NextEra Energy (renewable/nuclear) and Cheniere (LNG) are key players benefiting from the need for stable, long-term energy sources amidst geopolitical instability.

2. BlackBerry: Transformation and Market Positioning

BlackBerry reported a "beat and raise" quarter with 26% revenue growth, driven by QNX and cybersecurity.

• Market Misconception: Analysts argue the market still views BlackBerry as a legacy phone company rather than an embedded software leader.
• Competitive Moat: BlackBerry’s dominance in automotive software is being leveraged into robotics and industrial automation. Their software is preferred in high-value use cases requiring stringent safety and security.
• Growth Metrics: The company reported its highest level of new developer seats in eight quarters, signaling strong momentum in the automotive and embedded software segments.

3. TSX Outlook and Canadian Market Strength

Stephanie Hughes (Bloomberg) notes that the TSX is expected to outperform due to its focus on energy, materials, and financials.

• Earnings Growth: TSX earnings are projected to grow 30.6% in Q2 and 40% in Q3.
• Sector Performance: Energy is expected to expand by 104% and mining by 75%.
• Strategic Perspective: Strategists compare the current TSX performance to emerging markets, noting that the gains are broad-based, unlike the tech-concentrated S&P 500.

4. Micron Technology and the Memory Boom

Ivana Delevska (Spear Invest) discusses the shift in the memory chip industry.

• Supply/Demand: Demand is expected to exceed supply through 2027–2028.
• Strategic Agreements: Micron has secured 16 strategic customer agreements (averaging 3 years), which helps reduce the historical cyclicality of the memory market.
• Investment Strategy: Rather than betting solely on memory suppliers, investors are looking at capital equipment providers who benefit from the 2x–3x capacity expansion in the industry.

5. Ford: Cultural Reset and Quality Focus

CEO Jim Farley attributes Ford’s turnaround to a "culture of quality" over short-term profits.

• Methodology: Ford uses AI-driven vision systems and data-heavy control centers in plants to measure fastener torque and assembly precision.
• Ford Pro: This segment is a major growth driver, with 30–40% quarterly subscription growth and 80%+ gross margins. It provides productivity software and predictive maintenance for commercial fleets.
• Energy Storage: Ford is scaling its battery business, targeting both vehicle production and energy storage for hyperscalers, with a commitment of 5 gigawatt hours from EDF.

6. Market Movers and Notable Failures

• Jefferies: Shares fell 10% due to an EPS miss, though investment banking revenue rose 57%, potentially signaling a recovery for other Wall Street banks.
• Hertz: Experienced a 48% two-day decline following a profit warning and a complex share sale, resulting in significant gains for short sellers.
• Cerebras: Shares plummeted below their IPO price, illustrating the high-risk nature of AI-linked stocks that fail to meet "Nvidia-sized" market expectations.

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Synthesis

The market is currently navigating a transition from "shiny object" AI hype to the "second-order" beneficiaries of the AI build-out. The core themes are infrastructure resilience (power, data centers, senior housing), embedded software dominance (BlackBerry), and industrial transformation (Ford). While tech-heavy indices face volatility, the Canadian market is finding strength in traditional commodity and financial sectors, and the semiconductor industry is attempting to move away from boom-bust cycles through long-term, locked-in supply agreements.