Good Morning! Stocks soared on news that President-elect Trump is scaling back his tariff plans, only targeting specific goods and services rather than going broad. Nvidia CEO delivered a keynote to a packed crowd at Michelob Ultra Stadium, unveiling new products and stating that the 'ChatGPT moment for robotics is just around the corner.'

Fubo saw its stock soar 250% after announcing a merger with Disney’s Hulu + Live TV. UFC’s Dana White joined Meta’s board, and alcohol stocks tanked after the Surgeon General wants the U.S. to put cancer warning labels on alcoholic beverages.

Plus, Justin Trudeau resigned as Canada PM, Citadel will make top talent sign a 21-month non-compete, and Bridgewater will lay off 7% of its staff.

Your ultimate earnings playbook is here—explore Earnings Hub today.

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Boutiques Bet Big on 2025

It’s already looking like 2025 is going to be a make-or-break year for investment bankers. And so far? The Street is betting big on a robust deal-making rebound to justify sky-high valuations and aggressive hiring sprees.

Boutique firms like Evercore, Lazard, and Moelis have been strategically poaching top-tier talent from bulge bracket rivals like JPMorgan and even the late Credit Suisse. Evercore has increased its managing directors count by 27% since 2021, Moelis has grown by 26%, and Jefferies has grown by a massive 46%. And some guarantees for new managing director hires are north of $9 million a year.

But this hiring spree comes with significant risks. These big-ticket hires often require 12 to 18 months to ramp up and start generating meaningful deal flow. In the meantime, compensation ratios (the percentage of revenue allocated to employee pay) have ballooned—Lazard’s hit 66% in 2024, well above its target of 60%, underscoring the pressure on 2025 revenues to close the gap.

Investors are keeping the faith, for now. 2024 was a great year for banks, for boutiques and bulge-brackets alike e.g., Perella Weinberg was up 2x, and Goldman was up over 50%. But with forward price-to-earnings ratios for boutiques now at 30x–40x—nearly double the historical range, the pressure to deliver results in 2025 is on.

While some analysts are cautiously optimistic, one veteran CEO warned, "It’s a limited pie of deals. There’s going to be a reckoning."

Takeaway: 2025 is shaping up to be the year M&A makes its long-awaited comeback. For those poached away from bulge brackets, the honeymoon is over… and it’s time to prove their worth. As the clock runs out on guaranteed pay, the pressure is on to deliver that sweet dealmaking revenue and justify those hefty price tags. Because on Wall Street, the scoreboard doesn’t lie: you’re only as good as your last deal.

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• Real-Time Earnings Calendar: Never miss a report.

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Best of all? It’s free. Make smarter moves this season with the ultimate earnings resource.

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Top Reads

• Dollar falls most in two months on report Trump to limit tariffs (YF)

• Canadian Prime Minister Trudeau resigns as Liberal Party leader (AP)

• Bridgewater cuts 7% of its staff in effort to remain nimble (YF)

• Travel nightmare ensues as snowstorm slams millions of Americans (Fox)

• Fubo and Disney to merge live TV streaming businesses (Axios)

• Citadel extends non-compete to 21 months to retain talent (YF)

• Alcohol stocks sink after cancer alarm bell (Axios)

• Plane passengers will soon be navigating the internet courtesy of Elon Musk (Fox)

• Bill Ackman gets back into activism (Axios)

• Wall Street banks just quit a once-popular alliance (YF)

• Company spends 7-figures on single Tuna believed to bring 'good fortune' (Fox)

• The quagmire that is Fannie Mae and Freddie Mac (Axios)

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Markets Rundown

Stocks Rise to Begin the Week

Major equity markets started the week higher on Monday, led by growth sectors such as technology and communication services. Defensive sectors, including utilities and consumer staples, underperformed, along with real estate, which is sensitive to interest rate changes.

Overseas, Asian markets declined, while European markets rose on reports that President-elect Trump's universal tariff proposal might be limited to critical industries like steel and aluminum.

The U.S. dollar index weakened by 0.6% following the tariff news, though Trump disputed the reports. Bond yields ticked higher, with the 10-year Treasury yield climbing back above 4.6% and the 2-year yield closing near 4.27%.

Busy Week of Labor-Market Data Ahead

Key labor-market reports are expected this week, beginning today with JOLTS job openings for November, projected to remain around 7.7 million. This figure, while below the peak of 12 million in March 2022, still exceeds pre-pandemic levels.

The ADP Employment Survey for December, due Wednesday, is forecast to show private-sector job gains of 140,000. On Friday, the highly anticipated nonfarm payrolls report is expected to reveal a gain of 160,000 jobs for December, with unemployment steady at 4.2%.

Strong labor-market conditions have supported the U.S. economy over the past two years, and we believe they will continue to bolster growth in 2025.

European Economic Data Points to Ongoing Weakness

December's Markit PMI data suggest the eurozone economy is entering 2025 on shaky ground. The eurozone composite PMI came in at 49.6, signaling contraction for the second consecutive month and the seventh month below its 20-year average of 52.

Higher interest rates and elevated energy costs have weighed heavily on manufacturing activity in the region. Although energy costs have eased, the eurozone producer price index remains 40% higher than in December 2020. We expect Europe's economic momentum to trail that of the U.S. in 2025.

Movers & Shakers

• (+) Fubotv ($FUBO) +251% after announcing a merger with Disney’s Hulu TV.

• (+) Solaredge ($SEDG) +6% because the solar company will cut 600 jobs.

• (–) Tencent Holdings ($TCEHY) -8% after the US adds the company to the Chinese military blacklist.

Private Dealmaking

• Digital Edge, a data center company, raised $640 million

• Disney will merge with FuboTV for $220 million in cash

• H.I.G. Capital bought Quisitive, a Microsoft solutions provider, for $118 million

• Orbis Medicines, an oral macrocycle drug developer, raised $96 million

• Buk, an HR tech startup, raised $50 million

• General Proximity, a proximity medicines developer, raised $16 million

For more PE, VC & M&A deals, subscribe to our Buysiders newsletter.

_{BOOK OF THE DAY}

Default

Unlike individuals or corporations that become insolvent, nations do not have access to bankruptcy protection from their creditors. When a country defaults on its debt, the international financial system is ill equipped to manage the crisis.

Decisions by key individuals―from national leaders to those at the International Monetary Fund, from holdout creditors to judges―determine the fate of an entire national economy. A prime example is Argentina's 2001 default on $100 billion in bonds, which stands out for its messy outcomes and outsized impact on sovereign debt markets, sovereign debt law, and IMF policy.

Default is the riveting story of Argentina's sovereign debt drama, which reveals the obscure inner workings of sovereign debt restructuring. This detailed case study describes the intense fight over the role of the IMF in Argentina's 2005 debt restructuring and the ensuing bitter decade of litigation with holdout creditors, demonstrating that outcomes for sovereign debt are determined by a complex interplay between financial markets, governments, the IMF, the press, and the courts. 

This cautionary tale lays bare the institutional, political, and legal pressures that come into play when a country cannot repay its debts. It offers a deeper understanding of how global financial capitalism functions for those who work in or study debt markets, international finance, international relations, and international law.

“The dramatic inside story of the most important case in the history of sovereign debt law.”

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Hottest Year

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Relationships

Our romantic relationships are deeply influenced by how we perceive ourselves. Low self-esteem often leads to a fear of rejection or a tendency to settle for less. When we don’t see our own value, it’s hard to believe others, even our partners, see it either.

This fear can manifest in reluctance to pursue relationships or constant worry that a partner will leave. On the flip side, relationships where both partners see and affirm each other’s value tend to thrive. Believing in your partner—and letting them know it—creates a foundation of trust and commitment, strengthening the bond.

Oxytocin, often called the "love hormone," plays a role in enhancing connection, but its release doesn’t require grand gestures. Small, consistent acts of kindness, appreciation, and validation can deepen bonds and remind your partner of their worth. This applies not just to romantic relationships but to all human connections.

The key to stronger relationships starts with believing in your own value. When you do, you can freely give love and receive it, building a safe, supportive "home" with your partner and extending positivity to everyone you meet. Remember, reminding others of their value increases your own.

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Short Squeez Picks

• 7 strategies for breaking habits that trigger relapse

• Tricks to help you stop losing stuff

• The most powerful productivity tool ever invented

• 8 tips for sticking to your New Years resolutions

• How to become and stay happy 

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Memes of the Day