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Debt Deals for Qualtrics and EA Test Investor Appetite

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Banks led by JPMorgan are preparing back-to-back debt sales tied to major technology deals, in a move seen as a key test of investor appetite in a volatile market.

The first transaction involves financing the $55 billion leveraged buyout of Electronic Arts, which has already attracted strong demand, exceeding $19 billion. The package includes multiple loans and debt instruments across currencies.

Following this, banks plan to market a separate debt package to support Qualtrics’ $6.75 billion acquisition of Press Ganey Forsta. That deal is expected to be financed largely through leveraged loans and high-yield bonds.

The transactions come at a time when the technology sector is facing uncertainty, particularly due to concerns about artificial intelligence disrupting traditional software business models.

Market participants are closely watching how investors respond, as the success or failure of these deals could influence future large-scale financing in the tech sector.

Quantum Computing Stocks Send Speculators on a Wild Ride as Hype Outpaces Reality

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Quantum computing stocks have become Wall Street’s latest obsession — and one of its most unpredictable playgrounds. Companies such as Rigetti Computing, IonQ, D-Wave Quantum, and Quantum Computing Inc. have seen their share prices surge by 100% or more this year as investors chase what some call “the next great technological revolution.”

These firms are racing to commercialize quantum computers — machines that exploit the principles of quantum mechanics to solve problems far beyond the reach of today’s fastest supercomputers. The potential applications range from cryptography and logistics to drug discovery and financial modeling.

“It feels like science fiction has suddenly become a near-term reality,” said Sylvia Jablonski, CIO of Defiance ETFs, which runs the Defiance Quantum fund. Yet, analysts warn that enthusiasm may be running far ahead of fundamentals. Rigetti shares, for instance, have skyrocketed from just over $1 to as high as $58 this year, trading at more than 1,000 times the company’s sales.

“It’s a magic act,” said Christopher Poch of Promethium Advisors. “How else do you explain a company with a $13 billion valuation but only $22 million in forecast revenue?”

Despite the eye-popping numbers, most quantum firms remain unprofitable. Some, like Rigetti, have posted paper profits from changes in the value of securities, not from operations. Analysts say valuations in the “Quantum 4” — Rigetti, IonQ, D-Wave, and Quantum Computing Inc. — are now more art than science.

Still, optimism remains high. Major financial players such as JPMorgan Chase and HSBC have begun investing in quantum-based systems, and McKinsey projects the global quantum market could exceed $100 billion. But as Neuberger Berman’s Rick Bradt cautioned, “The promise is undeniable — but the timing remains deeply uncertain.”

SEC uncertain over approval of proposed 3x and 5x leveraged ETFs amid market risks

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The U.S. Securities and Exchange Commission (SEC) said it is “unclear” whether newly filed 3x and 5x leveraged exchange-traded funds (ETFs) will meet regulatory approval, raising questions over products that amplify returns beyond current leverage limits.

“Since the U.S. government shutdown began, the agency has received a large number of ETF registration statements seeking 3x and 5x leveraged, equity-linked exposure,” said Brian Daly, director of the SEC’s Division of Investment Management. “It is unclear whether these ETFs would comply with the Derivatives Rule (Rule 18f-4), which generally limits leverage to 2x,” he added.

The filings include 27 proposed leveraged ETFs from Volatility Shares, which submitted the first-ever 5x ETF for the U.S. market. Such funds aim to multiply daily stock returns fivefold, but carry heightened risk of losses in volatile markets.

The SEC’s limited operational capacity during the shutdown has also slowed reviews. Analysts warn that excessive leverage could expose retail investors to amplified losses.

“Over half of leveraged ETFs launched more than three years ago have closed, and 17% have lost more than 98% of their value,” said Bryan Armour, ETF analyst at Morningstar, underscoring the danger of high leverage.

Amid recent market turbulence linked to U.S.–China trade tensions, leveraged ETFs have been blamed for intensifying selloffs, with JPMorgan estimating $26 billion in forced selling last Friday alone.

The SEC said no filings will be reviewed until the shutdown ends, leaving the fate of the proposed ETFs uncertain.