Stocks tumble as record-setting rally cools

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• Fri, June 14, 2024 at 12:45 PM MDT

  Why Apple’s OpenAI deal is bad for Google

  Now that Cupertino has unveiled its AI plans, the relationship between frenemies Apple and Google just got more complicated.

  That’s because the sometimes-gadget rivals work as partners when it comes to search and online advertising. But the tie-up, which has featured heavily in a landmark antitrust lawsuit against Google’s dominance in the search engine market, will come under new strain as AI changes how people seek out information online.

  For more than two decades, Apple has fixed Google as the default search engine in its Safari browser. Apple steers the traffic of its huge user base into Google’s search business. And in exchange for the default privilege, Google pays the iPhone maker around $18 billion a year.

  But Apple, to the delight of investors, has another deal going.

  Apple is partnering with OpenAI to bring ChatGPT to the iPhone. It’s part of a bold effort to catch up to Big Tech rivals that have gone all-in on AI. Later this year, iPhone users will get free access to the chatbot, which will mesh with Siri and other apps, giving people access to a repository of knowledge and granting OpenAI a ticket to mainstreaming AI technology.

  Apple’s iPhones infused with increasingly capable versions of ChatGPT would lessen the need to use Google search. If users in significant numbers start interacting with the web primarily through Siri instead of a search bar, even the heavy influence of default status might mean very little for the future of search traffic.

  If chatbots and other software powered by large language models (LLMs) are as transformational as tech executives claim they are, the business of search is poised for major disruption.

• Fri, June 14, 2024 at 12:00 PM MDT

  Price pessimism continues despite positive inflation data

  The disconnect between positive inflation data and negative public sentiment continues to reveal itself, based on a new reading of consumer perceptions.

  The latest University of Michigan consumer sentiment survey released Friday showed sentiment hit its lowest level in seven months during June. The index reading for the month came in at 65.6, down from 69.1 in May and lower than the 72 economists had expected.

  Broadly speaking, the decline in the index represents a continued trend among consumers who are fed up with higher prices regardless of whether inflation is cooling and the labor market remains on solid footing, reports Yahoo Finance’s Josh Schafer.

  Experts have argued that the incongruence stems in part from how people perceive their own financial circumstances versus how they see the health of the national economy.

  The degree of negativity that isn’t always connected to a person’s own circumstances reflects the disorienting period of the pandemic and its aftermath, market observers have argued. And the rapid changes that followed — high inflation and high interest rates — can amplified those negative perceptions.

• Fri, June 14, 2024 at 11:18 AM MDT