AI-Fueled Stock Rally Dealt $1 Trillion Blow by Chinese Upstart…
What Does It Mean – For two years, AI technologies boosted US equities, with the Nasdaq 100 Index rising 92% since 2023, adding over $14 trillion in value. Recent AI hype, including $500 billion in planned investments from the Oval Office, further fueled market gains. However, the emergence of DeepSeek, a Chinese AI startup offering competitive technology at lower costs, caused the Nasdaq 100 to drop 3%, erasing nearly $1 trillion in value. Nvidia experienced its worst day since March 2020, losing almost $600 billion in market value. This event raised concerns about the sustainability of high valuations in the AI sector. Read more.
Tech’s $15 Trillion Rally Hinges on High-Stakes Earnings Stretch…
What Does It Mean – Big Tech companies are entering a crucial earnings cycle with shares near record highs and stretched valuations. Profit growth is expected to be the slowest in nearly two years, despite significant AI investments. The Magnificent Seven, including Alphabet and Meta, have driven a $15 trillion rally in the Nasdaq 100 since 2022, but growth is slowing. Analysts warn that high expectations may not be met, potentially impacting valuations. The sector’s earnings growth and AI enthusiasm have been key drivers, but concerns about profitability and valuation sustainability persist. Read more.
Bitcoin Follows Tech Stocks Lower as New AI App Rattles Markets…
What Does It Mean – Bitcoin experienced a decline as traders took profits following President Trump’s executive order on cryptocurrency regulation. The order, aimed at tightening oversight and enhancing security measures, led to market volatility. Bitcoin’s price fell by 5%, impacting other cryptocurrencies as well. Analysts suggest that while the regulatory environment may create short-term uncertainty, it could ultimately lead to a more stable and secure market. The executive order emphasizes the need for transparency and compliance, which could attract institutional investors in the long run. Read more.
US Yields Fall to Lowest This Year as Tech Slump Fuels Haven Bid…
What Does It Mean – US Treasury yields fell to a three-week low as investors sought safe-haven assets amid rising concerns over the tech sector’s valuations. The decline in yields was driven by a flight to safety, with market participants wary of potential volatility in tech stocks. This shift in investor sentiment was influenced by recent developments in the AI industry, which raised questions about the sustainability of high valuations. The Federal Reserve’s upcoming policy meeting also contributed to the cautious market environment, as traders anticipated potential changes in monetary policy. Read more.
Mittens the cat is mistakenly left on a plane and becomes a frequent flyer…
A Maine coon cat named Mittens became an accidental jetsetter this month when her cage was overlooked in a plane cargo hold and she made three trips in 24 hours between New Zealand and Australia.
Mittens, 8, was booked for one-way travel with her family from Christchurch, New Zealand to their new home in Melbourne, Australia on Jan. 13. But owner Margo Neas said Wednesday that as she waited for Mittens to be unloaded from the plane’s freight area, three hours passed with no sign of the cat.
It was then that ground staff told Neas the plane had returned to New Zealand — with Mittens still on board. The return trip involves about 7.5 hours in the air.
The Air New Zealand pilot was told of the extra passenger during the flight and turned on the heating in the cargo hold to keep Mittens comfortable, she added. Neas was told that a stowed wheelchair had obscured a baggage handler’s view of Mittens’ cage.
But the saga had a happy ending. The pet moving company that Neas used to arrange Mittens’ travel met the cat on her return to Christchurch and ensured she was back on the plane for another trip to Melbourne — this time just one way.
“When the facts change, I change my mind.
What do you do?” ~ John Maynard Keynes
Our plan is “the plan will change.”
What is your plan?
Relative strength measures the price performance of a stock against a market average, a selected universe of stocks or a single alternative holding. Relative strength improves if it rises faster in an uptrend, or falls less in a downtrend. It is easily applied to individual positions in your portfolio and to sectors and asset classes.
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