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Market Moves Yesterday
S&P 500 @ 5,521.52 ( ⬇️ 1.39%)
Nasdaq Composite @ 17,303.01 ( ⬇️ 1.96%)
Bitcoin @ $82,076.21 ( ⬇️ 1.33%)
Hey Scoopers,
Happy Friday! Here’s what we’re covering today:
👉 S&P 500 enters correction territory
👉 Intel gains big
👉 Adobe disappoints Wall Street
So, let’s go 🚀
Market Wrap
Stocks continued their three-week decline on Thursday as markets reacted to President Donald Trump's latest tariff threats targeting European Union alcoholic products.
Trump announced potential 200% tariffs on EU alcohol imports in response to the bloc's 50% tariff on whisky, claiming it "will be great for the Wine and Champagne businesses in the U.S."
The market impact has been significant:
S&P 500 and Nasdaq tracking for weekly losses of 4.3% and 4.9% respectively
Dow is down about 4.7%, heading toward its worst week since June 2022
Nasdaq is now more than 14% below its recent record, firmly in correction territory
Russell 2000 is approaching bear market status, down roughly 19% from its high
"These tariff wars are intensifying before they're abating. It just adds to unpredictability and uncertainty, and that's a negative for stocks," said Jed Ellerbroek of Argent Capital Management.
Treasury Secretary Scott Bessent attempted to calm markets, stating the administration is focused on long-term economic health rather than short-term volatility.
Meanwhile, encouraging inflation data, including a flat February producer price index, failed to spark a rebound as trade policy concerns continue to overshadow positive economic indicators.
Trending Stocks 🔥
Ulta Beauty - Shares of the beauty retailer popped 7% in pre-market after it surpassed estimates for fiscal Q4.
Pager Duty - The data stock is up 6% in pre-market following strong earnings and the announcement of a share repurchase program.
UiPath - Shares fell 16% after it posted revenue of $424 million below estimates of $425 million. It also expects revenue for the current quarter to come between $330 million and $335 million, while analysts were looking for $368 million.
Mag 7 Leads the Market Sell-off
Utilities emerged as the only winning S&P 500 sector this week, eking out a microscopic 0.02% gain through Thursday while managing a 0.3% rise during the day the broader index entered correction territory.
Dividend-focused stocks like Consolidated Edison (up 17% YTD, 3.3% yield), Exelon (up 15.5%, 3.7% yield), and American Water Works (up 14.5%, 2.1% yield) offered rare safety amid the market turmoil.
Meanwhile, the once-dominant Magnificent 7 tech stocks have fallen dramatically from their record highs:
Tesla: -50.7%
Nvidia: -24.5%
Alphabet: -21.4%
Meta: -20.3%
Amazon: -20.1%
Apple: -19.4%
Microsoft: -19.1%
The broader market shows equally concerning trends, with six of eleven S&P 500 sectors now in correction territory:
Consumer discretionary: -21.7%
Information technology: -15.4%
Communication services: -14.6%
Materials: -14.2%
Energy: -11.9%
Industrials: -10.7%
Investor sentiment has turned decidedly negative, with the American Association of Individual Investors reporting record pessimism.
For an unprecedented third consecutive week, nearly 60% of retail investors expressed bearish views on the six-month outlook, while bullish sentiment remained below 20% - levels not seen since September 2022.
Intel Stock Surges 14%
Intel shares jumped more than 14% following the appointment of Lip-Bu Tan as the company's new CEO, ending months of leadership uncertainty for the struggling chipmaker.
Tan, who previously led chip software maker Cadence Design Systems and was a former Intel board member, replaces interim co-CEOs David Zinsner and MJ Holthaus, who took over after Pat Gelsinger's ousting in December.
Wall Street analysts broadly praised the selection:
Deutsche Bank's Ross Seymore called it a "desirable outcome," highlighting Tan's semiconductor industry experience
UBS analyst Timothy Arcuri noted Tan's valuable relationships with China and Taiwan
Bernstein's Stacy Rasgon expressed enthusiasm, saying Tan "is likely to bring a customer service mindset to the company"
The appointment comes during a critical period for Intel, which has:
Lost nearly two-thirds of its market value in 2024
Fallen to its lowest stock price in over a decade last August
Cut 15% of its workforce amid disappointing results
Despite these challenges, Intel stock has managed a modest 3% gain this year as the once-dominant American semiconductor company attempts to regain relevance in an industry transformed by the AI boom.
Adobe Plunges Despite Earnings Beat
Adobe's stock tumbled 14% following its quarterly earnings report. Investors looked past better-than-expected results to focus on growth concerns and questions about the company's artificial intelligence strategy.
The sell-off came despite Adobe reporting adjusted earnings of $5.08 per share and $5.71 billion in revenue, exceeding analyst estimates.
The company's forward guidance was largely in line with expectations:
Q2 forecast: $4.95-$5.00 EPS on $5.77-$5.82 billion revenue
Full fiscal year 2025: $20.20-$20.50 EPS on $23.3-$23.55 billion revenue (implying ~9% growth)
Investor concerns centered on Adobe's AI monetization efforts, as the company reported:
$125 million in annualized recurring revenue from AI products
Plans to double this contribution by fiscal year-end
Wall Street analysts highlighted the need for more clarity, with Bernstein's Mark Moerdler noting investors need to "observe longer-term trends" to believe Adobe is an AI winner.
Morgan Stanley's Keith Weiss added that while the new AI revenue disclosure was "a step in the right direction," investors need a "clearer roadmap" at next week's investor meeting.
Adobe CEO Shantanu Narayen defended the company's approach, telling CNBC that "the innovation that we've delivered is creating new revenue streams" while infusing AI into existing products.
Headlines You Can't Miss!
U.K. economy shrank in January
BMW posts 37% drop in net income
The trade war impacts multiple sectors
Private equity is heading for a shake-up
Bitcoin eyes 105k amid liquidity boost
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DISCLAIMER: None of this is financial advice. The newsletter is strictly educational and is not investment advice or a solicitation to buy or sell assets or make financial decisions. Please be careful and do your own research.