2/7/25

Megacap tech slump drags S&P 500 deep into the red

Major indexes extended losses after President Donald Trump said he would be announcing reciprocal tariffs on “everyone” sometime next week. The S&P 500 fell 0.9% while the Nasdaq 100 and Russell 2000 were both down over 1%. For the week, the benchmark US index posted a modest retreat.

Every S&P 500 sector ETF declined on Friday but one (energy), with consumer discretionary and materials at the top of the loserboard.

Amazon slumped despite racking up record sales, as the company’s guidance for the current quarter came in below analysts’ estimates. Barring a big sales surprise from Walmart later this month, the e-commerce giant is slated to top the S&P 500 leaderboard for revenue generation. It was a rough day for the Magnificent 7, with only Meta and Nvidia gaining and the rest down at least 1%.

Expedia was the top S&P 500 stock, ripping higher after reporting higher-than-expected bookings and revenue growth, results that also gave a lift to its peers. Video game company Take-Two Interactive wasn’t too far behind, ramping as its loose plan to release the highly anticipated “Grand Theft Auto VI” this fall remains intact.

AI on the cheap is working out for Pinterest, whose shares soared after applying the new technology helped bolster the company’s earnings outlook.

Shares of Uber rocketed higher after Pershing Square’s Bill Ackman revealed a stake of more than $2 billion in the ride-hailing app.

Alibaba had a strong session amid rumors that the Chinese e-commerce firm was taking a big stake in DeepSeek, and held a good chunk of its gains even after management denied that report.

Weed company Canopy Growth cratered after reporting a much larger loss than analysts anticipated.

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28m

Alaska Air declines as it warns its profit will be dinged by fuel costs, weather, and air traffic control problems

Seattle-based Alaska Air is trading lower Monday afternoon as the airline warned investors that its third-quarter profits will likely come in on the low end of its prior outlook.

When Alaska Air reported its second-quarter earnings in July, the airline said it expected third quarter earnings to land between $1 and $1.40 per share. As of early Monday, analysts polled by FactSet estimated $1.35.

A host of issues are behind the company's expectations of a dent to earnings. ALK said it's projecting fuel costs to climb to between $2.50 and $2.55 per gallon, up from its previous estimate of $2.45, due to West Coast refinery disruptions. Weather and air traffic control issues “led to increased costs from overtime, premium pay and passenger compensation,” said Alaska.

With Monday afternoon’s move, ALK shares are down about 8% year to date.

markets

1h

Intel cuts expense forecast, sees best gain in weeks

Intel shares jumped after the partially nationalized US chip giant snipped its forecast for operating expenses this year to $16.8 billion from $17 billion after finalizing the divestiture of 51% of its stake in its Altera programmable chip unit to private equity firm Silver Lake.

Shortly after 12 p.m. ET the stock was up 4%, Intel’s best gain since August 22, when the Trump administration announced the extraordinary step of having the federal government take a 10% ownership stake in the private chip company.

Intel trims full-year expense outlook following Altera stake sale

Intel trims full-year expense outlook following Altera stake sale

Complex Simplicity

OpenAI doesn’t have the cash to pay Oracle $300 billion — raising it will test the very limits of private markets

The ChatGPT maker plans to burn though $115 billion by 2029. No company in history has ever lit that much money on fire intentionally, let alone tried funding such a splurge through private markets alone.

David Crowther2h

markets

3h

Seagate, Western Digital romp as hard drive makers dominate S&P 500 leaderboard

Hard drive makers Seagate Technology Holdings and Western Digital surged Monday, putting them comfortably in the top two spots of this year’s top performers in the S&P 500.

Shortly after 10:30 a.m. ET, they were looking at gains of roughly 145% and 130%, respectively, for the year.

Not much news on the day, though Bank of America analysts have boosted the price target for Seagate to $215 from $170 while upwardly revising their outlook for hard disk drive demand this year, per The Fly.

Positive background music on the US and China’s trade relationship, important to IT hardware makers, is also likely helping, along with a general upswing in the AI data center trade.

Data storage is so hot right now

Data storage is so hot right now

Not much news on the day, though Bank of America analysts have boosted the price target for Seagate to $215 from $170 while upwardly revising their outlook for hard disk drive demand this year, per The Fly.

Positive background music on the US and China’s trade relationship, important to IT hardware makers, is also likely helping, along with a general upswing in the AI data center trade.

International investors want to own US assets — and have nothing to do with the US dollar

Looking at ETF flows, Deutsche Bank’s George Saravelos found that 80% of recent foreign inflows into US stocks and 50% of inflows into US bonds have been on a hedged basis.

College Football Playoff Semifinal at the Goodyear Cotton Bowl Classic - Clemson v Notre Dame

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