Union Pacific Railroad said today it was in "advanced" merger discussions with Norfolk Southern Railway, confirming last week's scoop by the WSJ.

• 🗣️ "There are no assurances that we'll reach an agreement, but we are talking," Union Pacific CEO Jim Vena said on an earnings call this morning.

🚂 The intrigue: A merger of the two would create a transcontinental railroad that would become the largest Class I carrier in the United States.

• Or news of the talks could spark a bidding war. And so far, there's been plenty of smoke (🚂) fueling speculation.

Zoom in: CSX — the other East Coast Class I railroad — was reported to be in talks to bring on financial advisers, per Reuters. And CEO Joe Hinrichs told Bloomberg that it was open to deals.

• Berkshire Hathaway CEO Warren Buffett, meanwhile, threw cold water Tuesday on reports from Semafor and Reuters that Berkshire-owned BNSF was exploring a takeover bid of an undisclosed rival railroad.

Yes, but: A Union Pacific-Norfolk Southern deal could force BNSF to seriously consider it.

• "If this merger were to occur, it would create pressure for BNSF and CSX to merge their operations to create a new entity comparable in size," Jason Miller, interim supply chain management chairperson at Michigan State University, tells Axios Pro.

The impact: Norfolk Southern shares closed down slightly today, but are up roughly 6.8% since the talks were first reported last week. Union Pacific shares closed down 4.5%.

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American Eagle Outfitters has joined the meme parade.

• The stock jumped over 12% this morning after the clothing retailer triggered social media attention (and mentions on the Wall Street Bets Reddit page) for its new campaign with actress Sydney Sweeney. It ended the day with a 4.3% gain

🔥 Between the lines: American Eagle checks the meme boxes — a known brand with more than 13% of its shares available for trading sold short, making it a prime candidate for meme-driven retail traders.

Yes, but: Yesterday's favorites cooled off a bit.

• 📉 GoPro closed down 4.6% today, and it's off 38% from yesterday's high. Krispy Kreme also finished today in the red, and it's off 23% from yesterday's top.

🛰️ SpaceX's Starlink said it was experiencing a network outage. (Bloomberg)

👷‍♂️ Intel beat expectations on Q2 revenue and issued a better-than-expected forecast. It also plans to reduce its workforce by 15% and ratchet down factory construction. Shares ticked up after the bell. (CNBC)

"Everyone is stating that I will destroy Elon's companies by taking away some, if not all, of the large scale subsidies he receives from the U.S. Government. This is not so! I want Elon, and all businesses within our Country, to THRIVE, in fact, THRIVE like never before!"

📉 Zoom out: Trump's post came just as stocks started trading in the U.S. this morning, with Tesla opening down 6.8%.

• Musk and Trump have sparred over the president's signature "big, beautiful bill," which Tesla just added by name to the "risk factors" section of its quarterly filing.

Between the lines: Trump appears to be tamping the tension down again, Axios' Ben Berkowitz writes.

• As far as the President's motivations?
• 📈 🏆 The better America's companies do, "the better the USA does, and that's good for all of us," Trump wrote at the end of his post. "We are setting records every day, and I want to keep it that way!"

For what it's worth, Tesla is a top-10 holding in the S&P 500 index.

President Trump toured the Federal Reserve's $2.5 billion headquarters construction project today, continuing his demands for lower interest rates from chair Jerome Powell.

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