Markets
Luke Kawa

US stocks slump into the weekend on turmoil with tariffs and tech

Friday was the same as Thursday — only worse.

Stocks tumbled and dip buyers were nowhere to be found, with the lowest share of up volumes across the New York Stock Exchange of this year. The S&P 500 fell just shy of 2%, the Russell 2000 was down 2.1%, and the Nasdaq 100 ended off 2.6%.

The pummeling of megacap tech stocks and tariff-sensitive companies was in focus to end the week. Consumer discretionary, communication services, tech, and industrials were the worst-performing S&P 500 sector ETFs, all down more than 2%.

Credit spreads also hit their widest levels of the year, signaling enhanced fear about a US economic slowdown.

Tesla tumbled as the analyst community warned the electric vehicle maker isn’t immune from tariffs and ahead of Q1 delivery results next week that are expected to be weak.

A fresh push from the US Department of Defense to cut software costs weighed on shares of Palantir.

Crypto-linked stocks like Strategy, Coinbase, and Robinhood sank along with bitcoin in the broad-based risk retreat.

(Robinhood Markets Inc. is the parent company of Sherwood Media, an independently operated media company.)

Lululemon had its worst day in more than a year after issuing a weak full-year sales forecast.

Ubisoft’s plans to spin off some of its major franchises were initially greeted warmly by investors before the stock got caught up in the sell-off and was shellacked.

Airlines continued their retreat, with Delta Air Lines, Southwest Airlines, American Airlines, and United Airlines shedding about $5 billion in value this week.

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Citi upgrades Palantir to “buy,” citing recent conversations with CIOs

Citi analysts hit the buy button on Palantir Technologies Monday, citing a strong outlook for growth both in Palantir’s large government contracting and defense business as well as its rapidly growing commercial division, which sells software to corporations to help them better use AI technology.

“Our upgrade is premised on our view that 2026 is poised to be another year of significant positive estimate revisions, with recent CIO [chief information officer] + industry conversations suggesting AI budget and use cases are accelerating in the enterprise. We also see significant tailwinds in the Government driven by accelerating defense budgets and modernization urgency.”

The bank, which had a “neutral” rating on the stock since February 2024, also cited chatter at its recent IT software conference, where participants talked up the cost savings generated by Palantir’s AI Platform software and noted that its Q4 IT survey on software budgets showed an incremental rise in budgets “especially for dedicated AI workloads and data project prioritization.”

“We expect PLTR, with its Foundry and AIP platform, to be one of the key Data Analytics/ AI vendors that could see further tailwind into numbers,” Citi analysts wrote.

Palantir is expected to report Q4 results on February 18.

But it’s an open question whether the surging growth Citi now sees for the company has already been priced in for the stock. The shares have risen close to 1,000% over the last two years, pushing standard measures of valuation to arguably lunatic levels.

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Chinese food delivery stocks soar as regulatory probe into price wars may save them from themselves

If there’s one thing Chinese companies are known for, it’s ruthless competition on price to make sure the nation’s products are attractive on global markets. Oftentimes, this comes with implicit or explicit state support for favored industries, which draws the ire of other countries.

Production > profitability is a pretty good shorthand for how China attempts to conquer tradable goods (see: electric vehicles). However, when it comes to consumer-oriented services, policymakers clearly don’t feel the same way.

Alibaba, Meituan, andJD.com are all soaring after the Chinese State Council’s anti-monopoly and anti-unfair competition committee said it’s investigating the food delivery sector over practices that are potentially distorting the market and weighing on brick-and-mortar firms.

These tech giants have been investing heavily in their food delivery capabilities, including via subsidies and incentives. Effectively, the market reaction here is that traders believe regulators are saving these companies from themselves.

A commentary in the state-run People’s Daily published midyear 2025, when JD.com announced plans to bolster its food delivery business, argued that there will be no “winners” in these price wars, which would lead to irrational consumption.

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