Ark Innovation ETF cuts 26 holdings

In today’s top stories, Cathie Wood’s Ark Innovation ETF slims down its holdings, the Pentagon announces the winners of a cloud computing contract bid, and Elon Musk’s bankers try to figure out what to do about their Twitter debt. Pharma stocks bounce on news that a law suit has been thrown out, and retail investors are surveyed on their moves for 2023.

Cathie Wood condenses ARKK holdings

Cathie Wood’s Ark Innovation ETF [ARKK] has concentrated its portfolio, which now stands at 32 companies from a previous 58, with Wood telling the Finimize Modern Investor Summit on Tuesday that she no longer feels China is supportive of innovation. Wood also compared current macro conditions to the 1910s, and said she expects year-over-year inflation to turn negative.

Pentagon cloud contract in four-way split

A $9bn cloud computing contract with the Pentagon has been split between Google [GOOGL], Oracle [ORCL], Microsoft [MSFT] and Amazon [AMZN]. A previous version was scrapped last year following accusations that former president Donald Trump’s administration had interfered in the award. The Joint Warfighting Cloud Capability offers the Department of Defense direct access to commercial cloud services “at the speed of mission”, the Pentagon said.

Musk’s bankers discuss Twitter debt alternatives

Anonymous insiders have told Bloomberg that Elon Musk’s bankers are discussing replacing part of the $13bn debt layered on Twitter during its acquisition with margin loans backed by Tesla [TSLA] stock. The existing debt structure would cost Twitter more than $1.2bn in annual interest payments. Twitter made a $221m net loss in 2021.

GSK, Haleon and Sanofi boosted by Zantac decision

2,500 lawsuits alleging that heartburn drug Zantac causes cancer were thrown out by US district judge Robin Rosenberg on Tuesday. The news caused a jump in shares of GSK [GSK] and Haleon [HLN.L], which rose 7.54% and 3.56% respectively on Wednesday. Sanofi [SNY], meanwhile, rose 1.35% in intra-day trading, before closing down 1.26% on the previous day. The companies had feared tens of billions of dollars in compensation could result from the suits, which Rosenberg said were based on flawed research.

Retail investors expect rout reversal in six months

A Finimize survey reveals that retail investors expect the market to bottom next year, with 29% planning to add to their portfolios and only 1% planning to sell their investments. The survey quizzed 2,000 retail investors in Europe, Asia and the US, with 80% expecting the stock market rout significantly recover in the next 6 months. The majority of traders said they plan to pick individual stocks to back, with tech names like Apple [AAPL], Microsoft [MSFT], Google [GOOGL] and Meta [META] being among stocks named.