Oil's Second Wind, a Grocery Gutting, and an Ethanol Glow-Up

The brief ceasefire in market anxiety lasted exactly one trading session. Iran said no negotiations, crude jumped, and stocks remembered what this week is actually about.

A few earnings reports added some color to the day, despite the geopolitical noise… let’s walk you through what moved and why it matters.

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U.S. stocks sold off hard today after Iran's foreign minister said the country had no interest in a ceasefire, erasing Wednesday's brief recovery and sending oil back toward its recent highs. The Dow led the decline as industrials and cyclicals bore the brunt, while software quietly continued its winning streak for a fourth straight day. Treasury yields climbed again, putting more pressure on rate-cut hopes.

Wells Fargo (NYSE: WFC) just received word that the Federal Reserve has terminated the last enforcement action tied to the fake accounts scandal.

After nearly a decade of oversight, restrictions, and reputational damage, the regulatory cloud that hung over this company is officially gone.

This is the final page of a chapter that cost Wells Fargo billions in fines, years of limited growth, and a brand reputation that had to be rebuilt from the ground up.

The Weight of What Happened

The scandal involved millions of fake accounts opened without the customers' knowledge.

It triggered congressional hearings, executive departures, and an unprecedented asset cap that physically limited the bank's growth. No major U.S. bank had ever faced anything like it.

You think about what it means to operate one of the largest banks in America with a ceiling bolted to your balance sheet for years. Every competitor grew while Wells Fargo was stuck in place.

Free to Compete Again

The asset cap was lifted last year. Now the final enforcement action is gone. Wells Fargo can pursue growth, acquisitions, and expansion without regulatory restrictions for the first time since the scandal broke.

You can call this a fresh start. But the real test is whether Wells Fargo uses this freedom to become the competitive force it was before the scandal, or whether the lost years left a gap that is harder to close than anyone expected.

AbbVie Inc (NYSE: ABBV) just raised $8 billion in fresh capital by borrowing money it does not have to pay back for decades. Some of that debt extends as far as 2066.

That is not a company in trouble. That is a company making sure it has serious firepower ready for whatever opportunity comes next.

When a pharma giant raises this much money at once, something big is usually on the horizon.

Room to Move Fast

AbbVie has been expanding aggressively into cancer treatment, brain science, and medical aesthetics.

All of those areas require significant investment in research, drug trials, and, potentially, in acquiring smaller companies with promising products.

You do not stockpile $8 billion unless you want the ability to act quickly when the right deal or breakthrough appears. This gives AbbVie that freedom without needing to ask for money later.

Big Borrowing, Bigger Ambitions

Healthy companies borrow big when they see opportunities ahead and want to lock in favorable terms. AbbVie just did exactly that on a scale that few pharma companies attempt.

You can expect this money to show up in pipeline deals, acquisitions, or both over the coming months. AbbVie made sure the cash was ready first, and the announcements will follow.

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BlackRock Inc (NYSE: BLK) 's private credit division just wrote down a $25 million loan from full value to zero in a single quarter.

The loan was to Infinite Commerce Holdings, an Amazon aggregator that buys and manages online sellers. Three months earlier, BlackRock valued that same loan at 100 cents on the dollar.

The amount is small. The speed of the collapse is not.

The Valuation Gap Is the Problem

Private credit loans are illiquid. They do not trade on open markets, which means valuations are often based on internal assessments rather than real-time pricing.

When a loan goes from full value to worthless in 90 days, it raises an uncomfortable question: what else in the portfolio might be sitting at marks that do not reflect reality?

You think about the thousands of loans across BlackRock's private credit book, and this one write-off suddenly represents something much bigger than $25 million.

This Is Not the First Time

BlackRock's private credit fund already slashed the value of loans to another struggling company late last year, citing that 91% of valuation losses came from deals written in 2021 or earlier that have been squeezed by higher interest rates.

If your confidence in the valuations starts to crack, everything else follows. When the world's largest asset manager cannot see a total wipeout coming three months in advance, it says something about the entire market's ability to price risk honestly.

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Alto Ingredients [ALTO] $4.02 (+54.62%)

Alto flipped from a full-year loss to a full-year profit, and the market treated it like a comeback story worth celebrating. When a company that has been losing money for four straight years finally turns the corner, buyers tend not to wait around.

CPI Card Group [PMTS] $17.60 (+41.25%)

CPI makes the physical credit and debit cards that banks hand to customers, and it just reported revenue up 22% year over year with debit and credit card sales surging 40%. The market did not care that earnings missed slightly — when the top line runs that hot, buyers tend to forgive the rest.

Sable Offshore Corp [SOC] $13.85 (+37.26%)

Sable spun an interesting narrative today as its stock price rose despite a downgrade to hold. As conflict continues in Iran, energy stocks like SOC could still see positive momentum as scarcity issues come into the spotlight.

Grocery Outlet [GO] $6.34 (-27.87%)

Grocery Outlet posted a massive net loss, announced it is closing 36 stores, guided for flat to negative same-store sales, and missed earnings estimates — all in the same report. The CEO called the quarter "unacceptable," and the stock agreed.

FTC Solar [FTCI] $5.40 (-27.11%)

FTC Solar got dragged down as the broader clean energy space continued to struggle, with rising energy costs and macro uncertainty keeping pressure on the sector. Sometimes a tough tape hits names that were already on thin ice.

Distribution Solutions Group [DSGR] $21.90 (-26.29%)

DSGR missed earnings by more than 40% as operating margins collapsed from nearly 5% down to under 2%. When a boring industrial distributor delivers that kind of earnings shock, there is nowhere to hide.

A major energy breakthrough is unfolding — and it’s moving fast.

An MIT-trained scientist has unlocked a virtually inexhaustible energy source,
now drawing attention from the Trump administration.

According to the U.S. Department of Energy, it could power the world for billions of years.

That’s why Google, Microsoft, Amazon, General Electric, and Meta are racing to get involved.

See what this new fuel means next.

That's it for today! Please, write us back, and let us know what you think of the Closing Bell Roundup. We're always eager to hear feedback!

Thanks for reading. I'll see you at the next open! 

Best Regards,
— Adam G.
Elite Trade Club

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