[Market Summary]
The three major New York indices closed lower today. The market did not welcome the nomination of the hawkish Kevin Warsh, former Federal Reserve Governor, as the next Fed Chair. Furthermore, a massive 30% plunge in silver prices—which had surged since last year due to speculative trading—sent shockwaves through the broader market.
Dow Jones: 48,892.47 (-179.09 pts, -0.36%)
S&P 500: 6,939.03 (-29.98 pts, -0.43%)
Nasdaq: 23,461.82 (-223.30 pts, -0.94%)
The Warsh Nomination: President Trump officially named Warsh as the next Fed Chair. While the Senate must approve the appointment, markets expect a smooth confirmation. However, Warsh’s advocacy for reducing the Fed's balance sheet and minimizing market intervention is not viewed as a bullish catalyst.
The Silver & AI Shock: Silver futures plummeted over 30% intraday, marking its worst drop in 46 years. This dragged gold (-10%) and copper (-6%) down as well. Since silver is a critical component in AI power infrastructure, this crash was interpreted as a sign of cooling AI expectations following Microsoft’s weak cloud results. Consequently, the Philadelphia Semiconductor Index dropped 3.87%.
Fed Watch: The CME FedWatch tool now reflects an 84.7% probability of a rate freeze in March. The VIX rose to 17.44.
[Featured Stocks & Analyst Updates]
■ Alphabet (GOOGL)
Project Genie: Google introduced an experimental prototype where users can create/explore virtual worlds via text or images. Powered by the Genie 3 model, it is currently rolling out to Google AI Ultra subscribers.
AGI Strategy: While Google admits current limitations in visual fidelity, Genie is presented as a key step toward simulation-based AGI.
■ Microsoft (MSFT)
Growth Concerns: Azure cloud growth slowed to 39% (vs. 40% previously), missing expectations.
Capex Pressure: AI Capital Expenditure surged 66% to $37.5 billion, leading investors to question the speed of ROI.
IB Views: Barclays noted Azure growth may struggle to accelerate due to high-margin product prioritization. Bernstein advised focusing on long-term benefits over short-term stock prices.
■ Amazon (AMZN)
Wedbush Reaffirms: Maintained Buy ($340 PT), citing AWS growth, stable retail performance, and resilient advertiser demand.
■ Meta Platforms (META)
Legal Battle: Meta faces a jury trial in New Mexico next week regarding allegations of aiding child exploitation. Meta denies the claims, citing First Amendment protections and Section 230.
Paid Tier Strategy: Meta is introducing a paid subscription including Manus (AI Agent) and Vibes (Video tool), while keeping the free version. Ad revenue still accounts for 98% of total revenue.
■ Tesla (TSLA) & SpaceX
Integration Rumors: Reports suggest SpaceX is discussing a merger with Musk’s AI startup xAI ahead of its IPO. Bloomberg also noted the potential for a merger between SpaceX and Tesla, which long-term investors view as a way to accelerate Tesla’s transition into a "Physical AI" company.
■ Chevron (CVX)
Mixed Q4: Adjusted EPS of $1.52 beat estimates, but revenue ($46.87B) missed.
Venezuela Expansion: CEO signaled that Venezuelan production could increase by 50% in 18–24 months. Chevron raised its dividend by 4.1% to $1.78.
■ Visa (V)
Solid Beat: Revenue rose 15% to $10.9B, with adjusted EPS of $3.17. However, concerns remain regarding rising operating costs and regulatory scrutiny on credit card interest rates.
■ SanDisk (SNDK)
Explosive Earnings: Reported EPS of $6.2 (vs. $3.49 est) and revenue of $3.03B (+61% YoY).
Bullish Guidance: Projects Q1 revenue of $4.4B–$4.8B (50% above consensus) and EPS of $12–$14 (3x consensus).
IB Hikes: Morgan Stanley hiked its target to $690 (Buy), noting earnings capacity is outpacing the stock price rally.
■ Deckers Outdoor (DECK)
Record Performance: Reported record revenue ($1.96B) and EPS ($3.33) driven by global demand for Hoka and UGG. Raised FY2026 guidance significantly.
■ KLA Corp (KLAC)
Beat but Cautious: Beat revenue and EPS estimates, but provided a lower-than-expected non-GAAP gross margin guidance of 61.75%.
■ ExxonMobil (XOM)
Profit-Taking: Fell 2% despite beating estimates, as lower oil prices weighed on sentiment.
■ SoFi Technologies (SOFI)
All-time Highs: Beat estimates with adjusted EPS of $0.13 and revenue of $1.03B. Fee-based revenue surged 53% to a record $443M. Issued strong 2026 guidance.
■ AstraZeneca (AZN)
Obesity Market Entry: Signed an $18.5 billion deal with China’s CSPC Pharmaceutical for long-acting peptide drugs and a "Liquid-gel" platform that allows for once-a-month injections.
■ Broadcom (AVGO)
Wolfe Research Upgrade: Upgraded to Buy ($400 PT), citing explosive demand for Alphabet's TPUs, which Broadcom helps design. TPU shipments could reach 7M units annually by 2028.
■ Spotify (SPOT)
Citi Upgrade: Upgraded to Buy ($650 PT), attributing recent price drops to sector rotation rather than fundamentals. Noted potential for price hikes and margin improvement.
■ Other Key Sector News
■ Verizon (VZ): Beat estimates and approved a $25 billion share buyback program.
■ Dominion Energy (D): Cost estimates for its CVOW offshore wind project rose to $11.5 billion due to regulatory delays and tariffs.
■ Eli Lilly (LLY): Investing $3.5 billion in a new PA manufacturing plant to expand weight-loss drug production by 2031.
■ Instacart (CART): Expanding its Costco partnership to France and Spain for same-day delivery.
■ Novo Nordisk (NVO): Wegovy pill prescriptions hit 26,109 last week, outpacing injectable competitors.
■ Micron (MU): A VP sold $10.4 million in stock, though the market remains focused on HBM supply shortages.
■ GameStop (GME): CEO Ryan Cohen is considering M&A using $8.8 billion in cash, with Michael Burry (The Big Short) reportedly supporting his capital allocation skills.
■ Charles Schwab (SCHW): Raised its quarterly dividend 19% to $0.32.
■ Mining Stocks (NEM, FCX): Plunged as metal prices (Silver/Gold) corrected following the Warsh nomination.
■ ServiceNow (NOW): Rebounded as valuation looked attractive despite fears of AI Agents cannibalizing existing software models.
■ Charter (CHTR): Surged after reporting a surprise net increase of 44,000 video subscribers.
■ DraftKings (DKNG) & Flutter (FLUT): J.P. Morgan warned of weak New York betting data, with GGR down 31% YoY during the NFL playoff season.
