Nvidia CEO Jensen Huang walks through the Hart Senate Office Building at the Capitol on July 28, 2026 in Washington, DC, USA.
Kylie Cooper | Reuters
Hello, my name is Hui Jie from Singapore. Welcome to another edition of CNBC’s Daily Open.
Nvidia’s partnership with an all-star cast of Wall Street companies hopes to raise more than $500 billion to build AI infrastructure. But experts say the venture is not without risks.
In the Middle East, the growing threat has been brought back into focus after a ship was rammed by US forces in the Strait of Hormuz, while a Houthi attack claimed six lives in the Red Sea, the first fatality recorded in the region in more than a year.
What you need to know today
Nvidia, which sold the chips powering the artificial intelligence boom to investors, is hoping Wall Street will fund its construction itself.
Nvidia has partnered with six financial giants to disrupt the AI industry. Is it a goal? Assemble a $500 billion pipeline to finance the construction of data centers and GPU clusters for companies that lack credit ratings or the funds to buy millions of dollars of silicon.
But this plan rests on an important premise. That means Nvidia’s graphics processing units retain their value over time and behave more like traditional hard assets than fast-depreciating consumer electronics.
“The primary risk here is depreciation,” said Ben Emmons, founder of FedWatch Advisors, adding that the single biggest threat to Nvidia’s funding model comes from China. China is rapidly increasing its domestic computing capacity and may choose to flood the market with low-cost silicon in a price war.
As Warren Buffett said in 2001, “You only know who’s swimming naked when the tide goes out.”
Elsewhere in the tech world, Google’s DeepMind has appointed Koray Kavukcuoglu as head of AI. Kavukcuoglu, who previously served as CTO of AI and chief AI architect for the parent company, faces a race to catch up with the likes of Anthropic and OpenAI on the frontier of building the industry’s most advanced models.
DeepMind hasn’t released a Frontier model since 2026, but Anthropic and OpenAI have released new systems in recent months.
red sea tension
A Houthi attack in the Bab el-Mandeb strait on Tuesday killed six crew members on a cargo ship, the first fatality reported from an attack targeting ships in the Red Sea in more than a year.
Separately, the Yemeni Coast Guard announced that two members of the National Resistance Army, allied with the Yemeni government, were also killed in additional attacks during the rescue operation.
The attack came after US forces in the Strait of Hormuz fired missiles at a container ship that was said to be trying to break through Washington’s blockade of Iranian ports in the Gulf of Oman.
U.S. Central Command said late Tuesday that a Navy helicopter fired two missiles at the Panamanian-flagged Bellanova, disabling it from maneuvering and propulsion after the crew ignored warnings as it sailed through the Gulf of Oman.
Crude oil prices rose on Tuesday, with U.S. West Texas Intermediate futures up 0.63% to $83.71 per barrel, and Brent crude at one point above the $90 mark.
circular slippery slide
In Asia, Japan’s yen is nearing the crucial 160 yen level against the dollar, reversing gains from intervention efforts when Japan and the United States coordinated to prevent currency depreciation.
But why didn’t the intervention help stop the currency devaluation?
Jesper Cole, specialist director at Monex Group, said: “The intervention has scared the market, but it hasn’t stopped the law of finance that money flows in the direction that gives the greatest returns…As long as the cost of money in Japan is lower than the returns overseas, the carry trade will be active again.”
And finally…
AI agents’ ‘amazing’ hacking skills create rush to spend on cybersecurity
A series of recent AI hacking incidents has pushed cybersecurity to the forefront of conversation as labs race to develop agent AI from frontier models.
OpenAI and Anthropic announced last week that a model had been compromised from their own testing environment and hacked by another company. Meta then announced that one of its AI models was hacked by another company during a cybersecurity assessment.
These episodes are unfolding against a broader cyber arms race fueled by the inherent risks posed by cutting-edge AI models and rapidly changing technological capabilities.
AI-powered phishing has been found to be approximately five times more effective than human phishing. So while chips and data centers have dominated the first wave of AI capital spending, cybersecurity could be the next spending boom.
— Mavis Mook
