Streaming Wars Go Hostile Just as Wall Street Braces for the Fed

Stocks slipped from record levels on Monday as investors shifted into “wait-and-see” mode ahead of Wednesday’s Fed decision. At the same time, Hollywood turned into a live-fire M&A battlefield, with Paramount Skydance crashing Netflix’s party for Warner Bros. Discovery and IBM writing a big AI-data check for Confluent.

A Soft Pullback Before Powell Takes the Stage

If you were hoping for a quiet Monday before the Fed, no such luck.

All three major U.S. indices closed lower as traders locked in some profits and tried to front-run what a “dovish but not too dovish” Jerome Powell might say on Wednesday.

The pullback is modest in points, but the context matters: we’re coming off a strong multi-week run, with the S&P flirting with record closes and tech still carrying a big chunk of the market’s hopes.

Under the surface, the market is sending a pretty clear message: “Yes, we want rate cuts… but not the kind that scream ‘something’s wrong.’”

The 10-year Treasury yield pushed up to around 4.17%, its highest level in about a month, even as futures price in a very high probability—roughly 85–90%—of another 25 bps cut this week.

That combination (higher long rates and more cuts) is exactly what makes equity investors a bit jumpy: it hints at a bond market that’s no longer fully buying the “soft landing forever” narrative.

Streaming Wars: Paramount Crashes Netflix’s Deal for Warner

The real drama wasn’t on Wall Street but in Hollywood’s boardrooms.

Netflix (NFLX | -3.44%) took a punch after Paramount Skydance (PSKY | +9.02%) lobbed a hostile bid of roughly $108.4 billion at Warner Bros. Discovery (WBD | +4.41%), aiming to derail Warner’s recently announced tie-up.

A few key points I’m watching here:

• Warner Bros. Discovery jumped as investors started to price in the possibility of a bidding war or, at minimum, improved terms.

• Paramount Skydance was rewarded for swinging big, markets clearly like the strategic logic of bulking up against the streaming giants.

• Netflix sold off on fears it could lose a transformational content and distribution deal that would have further cemented its dominance.

• To spice things up, President Donald Trump publicly criticized the Netflix–Warner deal over the weekend, arguing it would give Netflix too large a market share and hinting that U.S. regulators shouldn’t rubber-stamp it.

With Trump back in the White House and already taking a muscular stance on several industries, investors are right to add a regulatory risk premium to any mega-deal in media and tech.

From a portfolio perspective, I’d frame it like this:

• For WBD, there’s now optionality: competing bidders, better pricing, or a stronger negotiating position.

• For NFLX, the story shifts from “relentless strategic momentum” to “execution and regulatory risk”, at least in the near term.

• For the sector as a whole, big consolidation attempts are a sign that content scale and IP ownership still matter more than ever in a world of slowing subscriber growth and rising content costs.

If you hold media stocks, this is one of those moments to check not just your direct exposure to these names, but also your second-order plays, content suppliers, cable distributors, ad-tech, and smaller streamers that could become “next in line” targets.

IBM Buys Confluent: AI Still Needs Plumbing

Away from the red carpets, we got another reminder that AI isn’t just GPUs and flashy demos, it’s also plumbing.

IBM (IBM | +0.4%) agreed to buy Confluent (CFLT | +29.08%) for about $11 billion, or $31 per share, a hefty premium to Friday’s close.

Confluent is all about real-time data streaming, think Kafka-based infrastructure that moves data between apps and services in milliseconds.

That’s increasingly essential for:

• AI copilots that need up-to-the-second information

• Real-time personalization and recommendations

• Fraud detection, monitoring, and analytics

In plain English: if AI is the “brain,” Confluent builds some of the nervous system.

For IBM, which has been trying to reposition itself as an AI and hybrid-cloud powerhouse, the deal:

• Deepens its data + AI stack (Watsonx, consulting, cloud)

• Adds a fast-growing, high-margin software business

• Helps keep it relevant in a market dominated by the hyperscalers

The market clearly liked the logic: CFLT ripped higher on the bid, while IBM managed a modest gain, which is not bad for a large acquirer in this tape.

For investors, this is another tick in the “AI infrastructure consolidation” column. If you own small or mid-cap data infrastructure names, this should sharpen your thinking about who might be next and at what kind of premium.

Stock Stories of the Day: Marvell, Kymera, Strategy

Marvell: When Not Making an Index Hurts

Marvell Technology (MRVL | -6.99%) was one of the day’s notable losers. Despite being a key AI-chip player, the stock was dumped after Carvana (CVNA | +12.06%), not Marvell, won the slot in the S&P 500.

Index inclusion trades are brutal in both directions:

• The winner (here, Carvana) gets forced buying from passive funds.

• The runner-up often gets hit with disappointment selling from active managers who were front-running an inclusion that never materialized.

Longer-term, nothing fundamental changed for Marvell’s AI positioning in one session, but the move is a reminder: flows can dominate fundamentals in the short term. Position sizing around these kinds of events matters a lot more than the story you tell yourself.

Kymera: Biotech Euphoria on Phase 1b Data

Kymera Therapeutics (KYMR | +41.55%) exploded higher after reporting strong Phase 1b results for KT-621, its oral STAT6 degrader for atopic dermatitis and related Type 2 inflammatory diseases. Data showed deep STAT6 degradation and encouraging biomarker improvements, with a clean safety profile so far.

That’s all very promising, but I’ll be blunt, a 40%+ one-day move in a small-cap biotech on early-stage data is exactly the kind of chart you should respect and treat with skepticism.

If you trade this space, great, just know you’re playing the “clinical trial and capital markets” game, not a stable cash-flow compounder.

Strategy (ex-MicroStrategy): Still the Giant Bitcoin Proxy

Finally, Strategy Inc.(MSTR | +2.63%) - the company formerly known as MicroStrategy - announced that it bought 10,624 additional bitcoin between December 1 and 7 for about $962.7 million, at an average of around $90,615 per BTC. That brings total holdings to roughly 660,000 bitcoin, with an aggregate purchase cost north of $49 billion.

Meanwhile, Bitcoin continues to trade well below its October peak above $126,000, but still at nosebleed levels historically.

If you own MSTR, you’re effectively long levered Bitcoin with equity dilution on the side. That can work spectacularly in bull phases, but it’s not exactly a sleep-at-night position.

Macro & Commodities: Oil and Gold Blink Ahead of the Fed

The macro backdrop is doing its best to keep everyone slightly uncomfortable:

• 10-year Treasury yield: around 4.17%, at a one-month high as investors start to worry about how slowly the Fed might cut in 2026, even if it delivers the widely expected 25 bps cut this week.

• Oil: WTI around $58 after a roughly 2% drop Monday, pressured by restored Iraqi supply and hopes for progress in Ukraine peace talks. More supply + less geopolitical risk = lower crude, at least for now.

• Gold: still hovering near the $4,200/oz area but slipped on the day as traders braced for a potentially hawkish tone from Powell despite the cut.

Big picture, the “rate cut + sticky yields + high gold + lower oil” cocktail tells me the market is trying to price:

• Slower growth and some disinflation (hence the oil softness),

• Ongoing policy and geopolitical risk (hence gold still elevated), and

• A Fed that may not deliver the pace of easing equity markets had been hoping for in 2026.

How I’d Think About Portfolio Positioning After This Session

If I boil down Monday’s tape into actionable thoughts:

• Don’t overreact to the index pullback. This looks like a positioning adjustment before the Fed, not a sudden macro shock.

• In media/streaming, widen your lens. The Paramount–Warner–Netflix triangle is about more than one deal; it’s about who will own global content and distribution five years from now, in a world where the U.S. administration is openly weighing in.

• In AI, follow the data plumbing, not just the chips. Deals like IBM–Confluent show that real-time data infrastructure is strategic. If you’re only holding GPU names, you’re missing an important part of the stack.

• In high-beta stories (Kymera, MSTR, etc.), be honest about your time frame. These are momentum and narrative trades, not buy-and-forget holdings.

Tomorrow the market will still obsess over the same thing: what exactly Powell signals about 2026. Today was just the dress rehearsal.

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Kristoff - ChartMill

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