Squawk on the Street SOTS 2nd Hour: Recession Odds Latest, Jefferies’ Volatility Playbook, and Applied Digital CEO Talks AI Demand 6/3/25
Jun 3, 2025
David Zervos, Chief Market Strategist at Jefferies, shares his insights on the stock market's shifting dynamics. He discusses UBS raising recession odds and the OECD's downgraded growth estimates in the U.S. Zervos emphasizes that despite cautionary warnings about inflation and deficits, bullish sentiments are emerging. The talk also highlights Applied Digital's significant $15B deal for AI datacenters and Meta's partnership for sustainable energy, showcasing the booming demand for AI capabilities and innovative energy solutions.
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Trade Tactics Analogous to Plaza Accord
- Trade negotiations are a tactical reset resembling the 1980s Plaza Accord currency deals.
- A cooperative, more balanced trading environment could arise, benefiting economic forecasts and equities.
Dollar Competitiveness and Equity Gains
- A more competitive dollar, rather than a weaker one, likely lies ahead as part of trade recalibration.
- Dollar hedging strategies may benefit investors while U.S. equities stand to gain from enhanced competitiveness.
Applied Digital's AI Data Center Journey
- Applied Digital built a purpose-designed AI data center campus in North Dakota for hyperscalers like CoreWeave.
- The CEO shared milestones and strategic shifts from Bitcoin hosting to AI high-performance computing.