Oracle Wins Big In New TikTok Deal

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Getty Images Seeking Alpha News Quiz Up for a challenge? Test your knowledge on the biggest events in the investing world over the past week. Take the latest Seeking Alpha News Quiz and see how you stack up against the competition. Good morning! Here is the latest in trending:Financial lifeline: The EU has committed €90B to Ukraine, but the bloc failed to agree on a plan to use frozen Russian assets for the loan.Pot stocks: Marijuana players sold off after President Trump signed a rescheduling order. See how SA Quant ranks cannabis shares.Market watch: While the November CPI was precisely what investors wanted, there might have been some issues with data collection. Wild trading is also expected on Wall Street today. Trusted partner Following years of drama, an agreement has finally been signed for TikTok to divest its U.S. entity to a joint venture that would be controlled by American investors, according to an internal memo sent out by CEO Shou Chew. Tech-focused investment firm Silver Lake is involved, as well as Larry Ellison-led Oracle (ORCL), with the latter's shares climbing 6% premarket on the news. The deal, likely to be valued at $14B, is expected to close in January and will help assuage U.S. government concerns about national security, foreign surveillance and algorithmic propaganda manipulation.The arrangement: It's a big development given that TikTok is regularly used by more than 170M Americans. The new venture will have a seven-member majority-American board of directors, while U.S. user data will be stored locally in a system run by Oracle. In that role, the company would serve as the "trusted security partner" for auditing and validating compliance, including "safeguarding sensitive U.S. user data, which will be stored in a trusted and secure cloud environment in the United States."Oracle would also be responsible for "retraining the content recommendation algorithm on U.S. user data to ensure the content feed is free from outside manipulation." Earlier reports suggested that a copy of the algorithm would be leased from ByteDance (Chinese law prohibits a sale or transfer), which Oracle would then scan for backdoors or unauthorized access. The company would also use its cloud infrastructure to continuously monitor the new algorithm’s inference and build secure gateways to allow for global content.Needed boost: Oracle's (ORCL) stock experienced a rough patch recently, losing nearly half of its market value since the end of September. However, the bearish turn is coming to an end, according to Investing Group Leader Ahan Vashi. "Enough froth has been wiped out for patient, long-term investors to justify fresh capital allocation," he writes in a new Seeking Alpha article, recommending staggered accumulation given cloud growth, cash flow and remaining performance obligations. Here's the latest Seeking Alpha analysis Best Defensive Stocks To Balance Tech Sector VolatilityThe Biggest Market Risk Nobody Is Talking About Right NowServiceNow: This Selloff Is A GiftBroadcom Vs Celestica: Unwarranted Selloff Makes Both Strong Buys My Highest-Conviction Monthly Income Plays Right Now - 3 Picks Averaging 8% What else is happening... Bank of Japan raises benchmark rate to highest level in 30 years.Trump Media (DJT) merger brings nuclear fusion into public markets.Chevron (CVX) keeps working in Venezuela amid tensions with U.S.Earnings: FedEx (FDX) efforts pay off, but there's trouble at Nike (NKE).Coinbase (COIN) sues three states over prediction market oversight.SpaceX (SPACE) may be one of the biggest buyers of Cybertrucks.GM (GM) is eyeing an ex-Tesla (TSLA) executive to be its next CEO.ECB says it is ready for digital Euro, pending lawmakers' approval. OpenAI (OPENAI) valuation could hit $830B with new funding round.Sony (SONY) is set to take over Snoopy and the Peanuts franchise. Today's Markets In Asia, Japan +1%. Hong Kong +0.8%. China +0.4%. India +0.5%.In Europe, at midday, London flat. Paris -0.2%. Frankfurt -0.1%.Futures at 7:00, Dow flat. S&P +0.2%. Nasdaq +0.3%. Crude +0.4% to $56.23. Gold -0.2% to $4,357.20. Bitcoin +0.7% to $87,921.Ten-year Treasury Yield +2 bps to 4.15%.

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