Highlights for the morning: investors fleeing the U.S., Reddit vs. AI startup, $1 billion IPO

Institutional investors are beginning to reconsider over-reliance on U.S. assets amid Donald Trump's trade wars and rising U.S. government debt. Reddit is suing artificial intelligence startup Anthropic for unauthorized use of user data, and bankrupt 23andMe is trying to resell assets, including genetic profiles, to its co-founder. These and other topics are covered in the review of key events by the morning of June 5.

Large institutional investors are beginning to reduce their investments in the U.S. market amid President Donald Trump's trade wars and rising government debt, raising doubts about the dominance of U.S. assets in global portfolios, the Financial Times reports.

For example, the Canadian pension fund Caisse de dépôt et placement du Québec (the second largest in the country) said it would reduce the share of investments in the United States (now account for 40% of the portfolio) and increase investments in the UK, France and Germany, the newspaper said.

The U.S. president's erratic trade policies have rattled global markets, causing the dollar to plummet and U.S. stocks to underperform European stocks this year. And pressure on US government bonds was intensified by the tax law that Trump proposed: according to predictions, it would increase US government debt by $2.4 trillion over ten years.

Investors should reconsider their reliance on the US market, Seth Bernstein - CEO of AllianceBernstein, which manages $780bn in assets - said in an FT s statement. «The deficit is not a new problem, but it's only getting worse. I think it's impractical for the U.S. to continue borrowing at the pace it's doing now. And combined with the unpredictability of trade policy ... It should make people pause and think: how much do you want to concentrate on one market?»,» said Bernstein.

One senior executive at a major U.S. private equity firm (the FT did not disclose his name) called Trump's imposition of duties - his so-called «release day» on April 2, when he announced «retaliatory tariff» rates - a «wake-up call» for those who have overloaded portfolios with U.S. assets.

«The U.S. has been the best place to invest for a century, but increasingly investors are questioning whether the U.S. has lost its exceptionalism,» said Howard Marks, co-founder of Oaktree Capital ($203 billion in assets).

While U.S. stocks have partially recovered since the tariffs were announced on April 2, the S&P 500 index is up only 1.5% YTD, while Europe's Stoxx Europe 600 is up 8.5%. The dollar is near a three-year low, down 9% since the start of the year, despite Trump suspending many of the originally announced duties.

While the US remains the world's largest economy with a deep financial system, investors are beginning to question whether this advantage will continue. The U.S. share of global stock market capitalization was about two-thirds at the beginning of the year, but the trend could now reverse, the FT said.

Investors are refocusing on Europe, where the stimulus effect of Germany's €1 trillion spending program is expected. «Europe is not the worst bet,» says Blackstone deputy chairman Tom Nides. - 'There are relatively stable governments here.

Circle Internet Group Inc. and its shareholders raised nearly $1.1 billion in an expanded initial public offering (IPO): the offering price was above the stated range, which had already been increased shortly before the IPO: a sign of growing acceptance of stablecoin issuers, writes Bloomberg.

The company and its shareholders, including co-founder and CEO Jeremy Allaire, sold 34 million shares at $31 apiece. That gave Circle a market capitalization of $6.9 billion based on the number of shares outstanding, and about $8.1 billion when options, RSUs and warrants are included, Bloomberg calculated.

The offering comes in anticipation of a bill to regulate steiblcoins - cryptocurrencies pegged to real (fiat) currencies - now in Congress. Major Wall Street banks are also considering issuing their own stablecoins, Bloomberg noted.

Circle issues one of the most popular dollar-oriented stablecoins - USDC. As of the end of March, it held about 29% of the market (according to CoinMarketCap), and about $61 billion of tokens are currently in circulation (as of May 29).

Of the total number of shares, Circle sold 14.8 million, while existing shareholders sold 19.2 million. According to Bloomberg's sources, demand for the securities exceeded supply 25 times by the time the order book closed. Three days before the IPO, Circle raised the IPO target from 24 million to 32 million shares and a range of $27-28 per share versus the original $24-26.

Cathie Wood's firm ARK Investment Management expressed a desire to buy up to $150 million worth of shares, and BlackRock intended to buy about 10%, Bloomberg wrote. BlackRock also manages a cash fund that holds 90% of the reserves backing the USDC, with a balance of $53.3 billion as of May 29.

Circle was valued at $7.7 billion in 2022.The IPO now comes after abandoning a previous attempt to go public through SPAC at a $9 billion valuation.The IPO is led by JPMorgan, Citigroup and Goldman Sachs. Shares will begin trading on the New York Stock Exchange on Thursday under the ticker CRCL.

Reddit has sued artificial intelligence startup Anthropic, accusing it of breach of contract and «unlawful and unconscionable conduct» for using Reddit's platform and data without permission, reports CNBC.

The lawsuit was filed Wednesday in San Francisco. Reddit claims that Anthropic is training its AI models on Reddit users' personal data without their consent, and that this damages the company because there is commercial use of its content without permission.

Amid this news, Reddit's stock jumped more than 6% on Wednesday, June 4;on Wednesday, June 4.

At the beginning of the lawsuit, Reddit calls Anthropic a «late-blooming» company that «presents itself as the white knight of the AI industry.» However, Reddit argues that this is far from the case: «Despite what Anthropic's marketing materials say, the company does not care about the rules of Reddit or its users: it believes it has the right to take whatever content it wants and use it however it wants - with impunity,» the lawsuit says.

An Anthropic spokesperson said in an email, «We disagree with Reddit's allegations and intend to vigorously defend our interests.»

Since the generative AI boom sparked by the launch of ChatGPT in late 2022, Reddit has been in the spotlight. Its platform, which has been around for 20 years, is filled with user-generated content on hundreds of thousands of topics and is actively used to train large AI models, including Anthropic's Claude.

In May, Reddit announced a partnership with OpenAI, which gave the company the right to use Reddit content for AI training. Reddit has a similar agreement with Google.

In the lawsuit, Reddit claims that «other AI giants understand and respect Reddit's rules.» Specifically, OpenAI and Google were only allowed to use Reddit's public content after agreeing to license terms that protect user privacy.

OpenAI CEO Sam Altman previously served on Reddit's board of directors and remains a major shareholder in the company - his stake is now worth more than $1 billion.

Anthropic, founded in 2021 by former OpenAI employees, was valued at $61.5 billion in March following an investment round led by Lightspeed Venture Partners with participation from Salesforce Ventures and Cisco Investments. Amazon is also a major investor in Anthropic.

Reddit, which IPOed in 2024, now has a market capitalization of about $22 billion.

Bankrupt DNA testing company 23andMe has told a U.S. bankruptcy judge it wants to reopen bidding for its assets - including customers' genetic data - after receiving a new $305 million offer from co-founder Anne Wodzicki, reports Reuters.

Previously, 23andMe selected a $256 million bid from Regeneron Pharmaceuticals as its main offer in an auction that ended in May.

However, a later bid came from TTAM Research Institute, a new nonprofit founded by Wodzicki. The company asked bankruptcy judge Brian Walsh in St. Louis, Missouri, to allow it to resume talks with potential buyers after determining that TTAM had the necessary financing for a higher deal.

Regeneron is willing to make a new offer for 23andMe's assets but is seeking $10 million in compensation if Wodzicki's offer is ultimately accepted, company attorney Emil Kleinaus told the court.

Kleinaus said Regeneron still wants to buy 23andMe, but believes it is unfair that the company is trying to «replay» the outcome of the past auction. «The auction was completed, the rules were clear,» he said.

California-based 23andMe filed for bankruptcy in March in an attempt to sell the business through an auction amid declining consumer demand and a 2023 data breach that exposed sensitive genetic and personal information of millions of customers.

More than 15 million customer DNA profiles collected using 23andMe's popular home saliva analysis kits are for sale.

The data leak and subsequent bankruptcy has raised concerns among U.S. lawmakers: they fear that the genetic information of millions of people could be sold to unscrupulous buyers.

Asia-Pacific markets were mixed on Thursday after U.S. private-sector job gains hit the lowest level in more than two years, reinforcing concerns that uncertainty over trade policy could weigh on the world's largest economy, reports CNBC.

According to ADP, jobs increased by only 37,000 in May - down from a revised 60,000 in April and well below the consensus forecast of 110,000, according to a Dow Jones survey of economists.

- South Korean markets extended gains from the previous session, with the Kospi index climbing 1.33% to an intraday high in more than 10 months and the Kosdaq small-company index adding 0.8%. Analysts at Nomura expect the Kospi to reach the 2,900 mark by the end of the year thanks to capital market reforms planned by President Lee Jae-men. The index is now at around 2,800.

- Japan's Nikkei 225 index was down 0.5 percent, while the broader Topix index lost 1.02 percent.

- Australia's S&P/ASX 200 was down 0.12 percent.

- Hong Kong's Hang Seng index rose 0.5 percent, while mainland China's CSI 300 index was little changed.

- India's Nifty 50 index was up 0.4 percent, while the BSE Sensex was up 0.5 percent. The Reserve Bank of India is expected to cut its key interest rate by 0.25pc on Friday. - to 5.75% - at the end of a two-day meeting.

- U.S. index futures were down 0.2% after the Dow Jones Industrial Average broke a four-day streak of gains. The Dow Jones lost 91.9 points (0.22%) to close at 42,427.74 in the United States the previous day. The S&P 500 index rose 0.01% to 5,970.81, while the Nasdaq Composite added 0.32% to end the day at 19,460.49.