Fearless Girl must be proud.

In the face of market volatility, geopolitical risk, worries of AI disruption, tariffs and more, Wall Street has refused to be rattled. Instead, it generated $45.9 billion in the first half of the year, according to a report released by New York State Comptroller Thomas DiNapoli Tuesday. That’s up 51.3% from the same period in 2025 and far exceeds New York City’s $45.3 billion forecast for the entire year. If the pace continues, profits could surpass $90 billion by the end of the year, which, even adjusting for inflation, would top 2009 levels.

Animal Spirits Return?

While nearly all revenue lines increased, underwriting activities, account supervision and commissions were particularly strong (commodities trading was the exception, likely due to oil’s soaring prices). Global mergers and acquisitions activity topped any other half-year period on record at $2.8 trillion, and Wall Street employees benefited, too: Average salaries including bonuses for New York City’s securities industry climbed 11.1% to $561,770 in 2025. DiNapoli said he now expects the 2026 bonus pool to increase, instead of falling 20% as the city had projected.

The enthusiasm and spending around AI have given the stock market a massive boost of late, with the S&P 500 hitting a new record on Tuesday, and excitement about massive upcoming IPOs from companies like Anthropic and OpenAI is likely to keep M&A activity strong. None of which is to say there isn’t plenty of risk to go around:

• The global bond market is still facing a sell-off, with the 10-year US Treasury yield recently hitting its highest level since 2002. Inflation is still well above the Fed’s target, and the markets are expecting at least one more interest rate hike at the end of the year.
• The equities rally may also be a product of algorithms rather than animal spirits, with a small number of megacap companies doing much of the work. The top 10 constituents of the S&P 500 account for 39% of the index.

City That Never Sleeps on Tax Collection: DiNapoli’s report was a reminder of just how much those eight blocks in the Financial District contribute to New York’s wallet. Wall Street generated approximately $26.3 billion in tax revenue for the state in the 2025-26 fiscal year, which was a 28.5% boost from the year before and about 20.8% of all the state’s tax collections. As for the Big Apple, it pocketed $7.8 billion in tax revenue from the securities industry in fiscal year 2026. That’s roughly 9% of the city’s total tax collections.

Muse has done nothing but inspire AMD’s stock.

Shares of the chipmaker are up nearly 30% since Meta launched its instantly popular Muse AI agent on September 8, a rally that has catapulted AMD into the $1 trillion market cap club. So how much higher can AMD fly? Plenty, according to a report out yesterday from Citi analyst Atif Malik.

Connect the Dots

That tracks with comments CEO Lisa Su gave to a gaggle of reporters in Taipei also on Tuesday; Su said the AI run will last for years, and that the company will “substantially increase our supply in 2027” to catch up to booming demand. After years watching GPU (graphics processing unit) king Nvidia dominate, the agentic era is AMD’s time to shine. That’s because agents use GPUs to think, a la large language models, but rely on CPUs to actually perform actions, such as managing email inboxes or shopping on e-commerce platforms that have not yet hung up a “No Robots Allowed” sign.

The total addressable market (TAM) for agentic AI is currently worth around $29 billion, but could explode to around $300 billion by 2030, Malik wrote, adding that AMD will be a key beneficiary. It’s why he increased his price target for the stock to $800 from $575. The TAM explosion may sound huge, but it is reflective of the rapid Muse takeoff:

• Meta’s app scored 5 million downloads in just 22 days, according to Sensor Tower. That’s a faster pace than ChatGPT (56 days) and Claude (492 days), and roughly on par with smash app successes like Pokémon Go, HBO Max and Fortnite. Last month, OpenAI also launched an always-on agent platform, Dots.
• Still, AMD faces plenty of competition. Nvidia earlier this year launched its Vera CPUs designed explicitly for the agentic era, while Wolfe Research analysts have said that rival Arm could capture as much as 50% to 75% of the agentic CPU market share overall (though the analysts also named AMD as a significant beneficiary of the agentic era).

AI’s a Small World: Amid its share price surge, AMD has made a splashy purchase. Last week, the company announced an $8 billion deal to acquire World Labs, which is developing “world models” that can create 3-D virtual environments out of just a few images. The company was started in 2024 by Fei-Fei Li, a Stanford University professor who has been dubbed “Godmother of AI.” In a Substack post announcing the deal, Li called AMD’s Su a “great friend.”

For old school defense contractors, it was Torpedo Tuesday.

Anduril Industries, the privately held defense tech firm founded by Palmer Luckey, revealed plans to build a $3.7 billion shipyard in Maryland yesterday. At the same time, the US Navy awarded the upstart defense company a $2.9 billion contract to make components for its prestigious, but delay-plagued, Virginia-class submarine program. For Anduril, best known for its autonomous drones and crafts, the deal signals it’s serious about taking on traditional defense giants.

New Business in the Old Line State

As the Trump administration has looked to shore up military capabilities amid wars in Ukraine and Iran, it’s turned to the tech sector to complement and compete with traditional defense contractors and invited Silicon Valley into the national security brain trust. In June, Andreessen Horowitz’s Marc Andreessen and former Thiel Capital COO Blake Masters, two leading defense tech investors, were appointed to a major Pentagon advisory board. Last week, Luckey and SpaceX’s Elon Musk were tapped to lead a Department of Defense review of the future of armed conflict alongside former House Speaker Newt Gingrich.

The Navy’s insatiable appetite for complex and mammoth ships and submarines has long tested the capacity of even the biggest military contractors. A Government Accountability Office report published last year concluded that the seven private shipyards constructing Navy vessels were not positioned to meet current goals. Take, for example, Virginia-class submarines: the US currently builds about 1.3 per year, well short of the goal of two.

Enter Anduril, which is being dropped into a massive potential business line to hasten production of the latest-generation nuclear-powered attack submarines. Virginia-class subs are currently jointly built by General Dynamics subsidiary Electric Boat and Huntington Ingalls Industries, with the former winning a portion of a $76.6 billion submarine award from the Navy this summer. Their new defense tech partner will start small, but executives made clear their ambitions are sky high — or, er, ocean deep:

• Anduril’s new Maryland shipyard, situated outside Baltimore and named Arsenal-2, is expected to open by the end of the decade. While it will initially manufacture smaller components for Virginia-class production, company President Christian Brose told a media briefing that Anduril expects to eventually build significant bow and stern sections of the submarine, known as super modules.
• In the short term, Anduril will make Virginia-class components including torpedo tubes at a new Orange County, California, facility slated to open in 2027. This, the company said, will give it a “two-year operational head start to develop and validate manufacturing methods” that it can apply to the Arsenal-2 shipyard when it opens.

Tolkien’s Tech Bros: Last year, Luckey founded Erebor, a startup-focused bank to fill the gap left by the 2023 collapse of Silicon Valley Bank. On Tuesday, the Financial Times reported that it has more than $7 billion in deposits after adding in excess of 500 customers and $3 billion in deposits in the third quarter. And yes, like Anduril and Peter Thiel-founded Palantir, Erebor is named after “Lord of the Rings” lore.