Frontier Investment Management
May 15, 2025
Third Week of May 2025
THE WELL-TH NOTES
Weekly data-driven insights on the markets and economy
1. Perplexity partners with PayPal
Perplexity announced on Wednesday that it is partnering with PayPal to enable U.S. customers to make purchases directly in its chat interface, allowing people to book travel, buy products, and secure concert tickets without leaving the platform. Payments will be completed with PayPal or Venmo, with PayPal handling processing, shipping, tracking, and invoicing. This move aims to distinguish Perplexity in the competitive generative AI market against OpenAI, Anthropic, and Google.[i]
2. Robinhood acquires WonderFi
Robinhood announced on Tuesday that it will acquire Canadian crypto firm WonderFi for $178.98 million in an all-cash deal, valuing WonderFi at a 41% premium to its previous close. This acquisition is part of Robinhood’s strategy to expand its international footprint and deepen its push into the crypto market. WonderFi’s brands, including Bitbuy and Coinsquare, processed more than $2.56 billion in crypto trading volumes in fiscal year 2024.[ii]
3. UnitedHealth CEO change
UnitedHealth Group announced the unexpected departure of CEO Andrew Witty on Tuesday, citing “personal reasons” for his immediate resignation. Stephen Hemsley, who previously served as CEO from 2006 to 2017, will take over. The company also suspended its 2025 forecast due to higher medical costs, causing shares to drop more than 10% yesterday.[iii]
4. April inflation slows
Inflation was slightly lower than expected in April as President Trump’s tariffs began impacting the slowing U.S. economy, according to a Labor Department report on Tuesday. The consumer price index rose 0.2% for the month, putting the 12-month inflation rate at 2.3%, its lowest since February 2021. Excluding food and energy, the core CPI also increased 0.2% for the month, while the year-over-year level was 2.8%.[iv]
5. Trump targets drug prices
President Trump signed an executive order on Monday to revive the “most favored nation” policy, aiming to slash drug costs by tying U.S. medicine prices to significantly lower ones abroad. The policy targets developed countries and impacts both the commercial market and Medicare and Medicaid. However, its effectiveness is uncertain and faces potential legal challenges.[v]
6. Trade tensions ease
On Monday, the U.S. and China agreed to temporarily suspend most tariffs on each other’s goods, significantly reducing reciprocal tariffs from 125% to 10%. This breakthrough follows high-stakes talks in Switzerland and marks a major thawing of trade tensions between the two largest economies. Stocks surged on the news, with Nasdaq futures up 3.7%, S&P 500 futures higher by 2.7%, and the Dow gaining over 840 points.[vi]
[i] Sigalos, MacKenzie. “Perplexity partners with PayPal for in-chat shopping as AI race heats up.” CNBC, 14 May 2025, https://www.cnbc.com/2025/05/14/perplexity-partners-with-paypal-for-in-chat-ai-shopping.html. Accessed May 14, 2025.
[ii] Reuters. “Robinhood woos Canadian crypto users with nearly $180 million WonderFi purchase.” CNBC, 13 May 2025, https://www.cnbc.com/2025/05/13/robinhood-to-buy-canadian-crypto-firm-wonderfi-for-nearly-180-million.html. Accessed May 13, 2025.
[iii] Constantino, Annika Kim. “UnitedHealth Group CEO Andrew Witty steps down, company suspends annual forecast.” CNBC, 13 May 2025, https://www.cnbc.com/2025/05/13/unitedhealth-group-ceo-andrew-witty-steps-down.html. Accessed May 14, 2025.
[iv] Cox, Jeff. “Annual inflation rate hit 2.3% in April, less than expected and lowest since 2021.” CNBC, 13 May 2025, https://www.cnbc.com/2025/05/13/cpi-inflation-april-2025.html. Accessed May 13, 2025.
[v] Constantino, Annika Kim. “Trump signs order aiming to cut some U.S. drug prices to match lower ones abroad.” CNBC, 12 May 2025, https://www.cnbc.com/2025/05/12/trump-drug-pricing-order-most-favored-nation.html. Accessed May 13, 2025.
[vi] Meredith, Sam. “U.S. and China agree to slash tariffs for 90 days in major trade breakthrough.” CNBC, 12 May 2025, https://www.cnbc.com/2025/05/12/us-and-china-agree-to-slash-tariffs-for-90-days.html. Accessed May 13, 2025.
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