Core Viewpoint - The AI capital expenditure (capex) is experiencing significant growth, presenting substantial investment opportunities, particularly in companies that provide the infrastructure for AI rather than the hyperscalers themselves [1][4]. Group 1: AI Capex Growth - AI capex spending is accelerating, indicating that the infrastructure build-out for AI has not yet peaked [1]. - The hyperscalers are engaged in a "winner-takes-all" competition, leading to unprecedented capital expenditures on infrastructure [3]. Group 2: Investment Strategy - The "picks and shovels" investment strategy focuses on companies that supply the necessary infrastructure for AI, rather than investing directly in the hyperscalers [2][4]. - Companies involved in the AI infrastructure are expected to benefit from a sustained flow of cash due to the hyperscalers' spending [3]. Group 3: Beneficiary Sectors - Chipmakers, such as NVIDIA and Broadcom, are key beneficiaries by providing AI processing power [6]. - Energy producers, including NextEra Energy and Constellation Energy, are essential for powering AI data centers [6]. - Commodities and materials suppliers, particularly those providing copper and wiring, are critical for connecting data centers [6]. - Infrastructure builders, like Vertiv Holdings and EMCOR Group, are vital for constructing data centers and cooling systems [6].

Core Insights - Oaktree Capital Management's latest 13F filing reveals a focus on deep-value cyclicals, energy companies with strong free cash flow, and special-situation equities with asymmetric payoff potential [1][2] Group 1: Top Holdings - TORM PLC (TRMD) is Oaktree's largest holding with 40,581,120 shares valued at $834.6 million, indicating strong conviction in the tanker cycle and a favorable supply/demand imbalance in the product tanker market [3] - Expand Energy Corp (CHK) holds 5,062,363 shares worth $537.8 million, reflecting Oaktree's long-term confidence in energy, particularly natural gas, despite minimal activity this quarter [4] - Garrett Motion (GTX) has 31,894,816 shares valued at $434.4 million, representing a classic special situation investment as the company continues to reduce leverage and grow cash flow post-restructuring [5] - AngloGold Ashanti (AU) consists of 4,185,261 shares worth $294.3 million, fitting Oaktree's strategy with improving margins and optionality in an inflationary environment [6] - Viper Energy (VNOM) has 6,285,062 shares valued at $240.2 million, showcasing a strong thematic bet on energy with predictable royalty cash flows [7] Group 2: Investment Strategy - Oaktree's portfolio heavily emphasizes deep-value cyclicals, particularly in tankers, energy producers, and commodity-linked businesses, all characterized by significant cash flow yield and depressed valuations [8] - The firm maintains a consistent philosophy of embracing dislocation, favoring investments in situations where pessimism is already priced in, such as restructuring plays and underfollowed foreign cyclicals [9] - Energy remains the highest-conviction theme for Oaktree, with multiple top holdings indicating an underestimation of cash generation durability across the sector [10] - Position changes reflect a blend of patience and opportunism, with Oaktree trimming stocks that rallied while increasing positions in VNOM and selected common stocks, aligning with a strategy of controlled aggression [11]

The S&P 500 Index ($SPX) (SPY) on Friday closed up by +0.54%, the Dow Jones Industrials Index ($DOWI) (DIA) closed up by +0.61%, and the Nasdaq 100 Index ($IUXX) (QQQ) closed up by +0.78%.  December E-mini S&P futures (ESZ25) rose +0.50%, and December E-mini Nasdaq futures (NQZ25) rose +0.76%. Stock indexes settled higher on Friday, with the S&P 500, the Dow Jones Industrials, and the Nasdaq 100 posting 2-week highs.  Strength in semiconductor stocks on Friday helped lift the overall market.  Also, energy ...

The S&P 500 Index ($SPX) (SPY) today is up by +0.39%, the Dow Jones Industrials Index ($DOWI) (DIA) is up by +0.61%, and the Nasdaq 100 Index ($IUXX) (QQQ) is up by +0.46%.  December E-mini S&P futures (ESZ25) are up +0.35%, and December E-mini Nasdaq futures (NQZ25) are up +0.43%. Stock indexes are moving higher today, with the S&P 500, the Dow Jones Industrials, and the Nasdaq 100 posting 2-week highs.  Strength in semiconductor stocks today is supporting gains in the overall market.  Also, energy produ ...

On Sunday, a group of eight Senate Democrats broke with their party to vote with Republicans to advance a bill to reopen the government. The bill would provide full-year funding for some departments, fund other agencies through January 30, and provide pay for furloughed government workers. The bill will also resume withheld federal payments to states and localities and recall agency employees who were laid off during the shutdown.US MBA mortgage applications rose +0.6% in the week ended November 7, with the ...

Market Performance - The S&P 500 Index closed down -0.28%, the Dow Jones Industrials Index down -0.37%, and the Nasdaq 100 Index down -0.31% on Wednesday [1] - December E-mini S&P futures fell -0.27%, and December E-mini Nasdaq futures fell -0.34% [1] Economic Indicators - The 10-year T-note yield rose +4 basis points to a 2.5-week high of 4.15% due to hawkish Fed comments and a significant increase in US August new home sales [2] - US MBA mortgage applications rose +0.6% in the week ended September 19, with the purchase mortgage sub-index up +0.3% and the refinancing mortgage sub-index up +0.8% [4] - US August new home sales unexpectedly jumped +20.5% month-over-month to a 3.5-year high of 800,000, surpassing expectations of a decline [4] Corporate Earnings and Market Sentiment - Rising corporate earnings expectations are seen as a bullish backdrop for stocks, with over 22% of S&P 500 companies providing guidance for Q3 earnings that are expected to beat analysts' expectations, the highest in a year [5] - S&P companies are expected to post +6.9% earnings growth in Q3, an increase from +6.7% as of the end of May [5] Sector Performance - Chip makers showed strength, supporting the stock market, while a +2% increase in WTI crude oil helped push energy producers higher [3] - AI optimism was bolstered by Alibaba's announcement to increase its AI spending beyond an initial $50 billion target, positively impacting AI-infrastructure stocks [3] Upcoming Economic Data - Weekly initial unemployment claims are expected to increase by +2,000 to 233,000 [6] - August core capital goods new orders are expected to slip -0.1% month-over-month [6] - August existing home sales are expected to fall -1.3% month-over-month to 3.96 million [6] - August personal spending is expected to rise by +0.5% month-over-month, and personal income by +0.3% month-over-month [6] - The August core PCE price index is expected to rise by +0.2% month-over-month and +2.9% year-over-year [6]

Core Insights - Iridium Risk Services / Navacord is sponsoring the Schachter Catch the Energy Conference to connect investors with opportunities in Canada's energy sector [2][4] - The conference will feature direct interactions between investors and executives from 45 participating companies, covering various segments of the energy industry [4][5] - The event is positioned as a significant opportunity for investors to gain insights during the early stages of a new bull market in the energy sector [5] Company Overview - Iridium Risk Services / Navacord aims to provide better service to the energy industry by focusing on risk management rather than just insurance advice [3] - The company has expanded its expertise beyond the energy sector while maintaining a strong focus on risk management [3] - The firm emphasizes high standards and client satisfaction as core values, positioning itself as a disruptor in the insurance brokerage community [3] Conference Details - The Schachter Catch the Energy Conference will take place on October 18th at Mount Royal University in Calgary [1] - The conference will allow investors to meet company executives and ask questions in a moderated format [4] - Major sponsors include the TMX group, highlighting the conference's significance in the energy investment landscape [4]