Chips, ships and a sliding yen
Nvidia CEO Jensen Huang walks through the Hart Senate Office Building on Capitol Hill in Washington, D.C., U.S., July 28, 2026.
Kylie Cooper | Reuters
Hello, this is Hui Jie writing to you from Singapore. Welcome to another edition of CNBC’s Daily Open.
Nvidia’s partnership with an all-star cast of Wall Street firms is hoping to raise more than $500 billion to build AI infrastructure. However, the venture is not without risk, experts say.
In the Middle East, escalation threats are in focus again after a ship was struck by U.S. forces in the Strait of Hormuz, while a Houthi attack in the Red Sea claimed six lives — the first time in more than a year that fatalities were recorded in the region.
What you need to know today
Having sold investors on the chips powering the artificial intelligence boom, Nvidia wants Wall Street to help bankroll the buildout itself.
Nvidia has partnered with six finance powerhouses to shake up the AI industry. It’s goal? To assemble a $500 billion pipeline to finance the construction of data centers and GPU clusters for companies that lack the credit rating or cash to buy millions of dollars of silicon outright.
However, the plan hinges on a crucial assumption: that Nvidia’s graphics processing units will hold their value over time, behaving more like traditional hard assets than fast-depreciating consumer electronics.
“Depreciation is the one key risk here,” said Ben Emons, founder of FedWatch Advisors, adding that the single biggest threat to Nvidia’s financing model comes from China, which is rapidly ramping up domestic compute capacity and could choose to flood the market with low-cost silicon in a price war.
As Warren Buffett said in 2001, “you only find out who is swimming naked when the tide goes out.”
Elsewhere in the tech world, Google’s DeepMind has appointed Koray Kavukcuoglu as head of the AI unit. Kavukcuoglu, who was previously the AI unit’s CTO and its parent company’s chief AI architect, faces a race to catch up with the likes of Anthropic and OpenAI at the frontier, building the industry’s most advanced models.
DeepMind has not released a frontier model since 2026, while Anthropic and OpenAI have released new systems in recent months.
Red Sea tensions
A Houthi attack in the Bab el-Mandeb Strait on Tuesday claimed six lives aboard a cargo ship, marking the first reported fatalities from attacks targeting Red Sea shipping in more than a year.
Separately, Yemen’s coastguard reportedly said two members of the Yemeni government-allied National Resistance Forces were also killed in a follow-up strike as they carried out a rescue.
The attacks come as U.S. forces in the Strait of Hormuz fired missiles at a container ship that allegedly attempted to breach 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 Panama-flagged Vela Nova, disabling its steering and propulsion, after the crew ignored warnings while transiting the Gulf of Oman.
Oil prices rose on Tuesday, with U.S. West Texas Intermediate futures up 0.63% to $83.71 per barrel and Brent crude briefly crossing the $90 mark.
Yen’s slippery slide
In Asia, Japan’s yen has been sliding closer to the critical 160 mark against the dollar, reversing the gains from intervention efforts when Tokyo and Washington coordinated to halt the currency’s depreciation.
But why has the intervention not helped stem the depreciation?
“Intervention has scared markets, but has not stopped the laws of finance which say money flows in the direction of maximum returns … as long as the cost of money in Japan is lower than the return overseas, carry trades will re-assert,” said Jesper Koll, expert director at Monex Group.
And finally…
AI agents’ ‘alarming’ hacking skills creates rush to spend on cybersecurity
A string of recent AI hacking incidents has pushed cybersecurity to the forefront of the conversation, as labs race to develop agentic AI from their frontier models.
Last week, OpenAI and Anthropic said models broke out of their testing environments and hacked into other companies. Following that, Meta announced that one of its AI models had hacked into another company during a cybersecurity evaluation.
These episodes are unfolding against a broader cyber arms race, accelerated by frontier AI models and the inherent risks brought by fast-moving technological capabilities.
AI-enabled phishing has been found to be around five times more effective than human attempts. So while chips and data centers have dominated the first phase of AI capex, cybersecurity could become the next spending boom.
— Mavis Mook
