Couldn't've said it better myself…
After four straight days of red candles, the market finally reminded everyone that “line goes up forever” is only reserved for the Bernie Madoff’s of the world. The S&P 500 logged its fourth consecutive loss (-1.19), the Nasdaq ate a clean -1.8%, and the Dow pretty much did the same with a -0.47% dip.
The main reason, you ask? The same thorn in the side as always: AI. More specifically, investors suddenly asking a question they probably should’ve asked six months ago… “Wait… who’s actually paying for all this sh*t?” For starters, the spark came from Oracle (-5.40%), after a report floated that Blue Owl pulled financing on one of Oracle’s $10B Michigan data center dreams. Oracle says everything’s fine, everyone’s calm, the project is definitely happening… which, historically, is what companies say right befoRe the group chat starts muting notifications.
(Source: CNBC)
Either way, the damage was done. Oracle sneezed, and the entire AI trade caught a nasty cold. Broadcom (-4.48%) got smacked, Nvidia took a near -4% hair cut, and AMD got kneecapped (-5.49%). Alphabet (-3.12%), Meta (-1.16%), and Microsoft (-0.06%) all caught strays as well. Basically, if your portfolio was built on the phrase “AI adjacent”... today was personal.
The issue here though is that big money isn’t dumping tech because AI is fake. They’re rotating because the writing on the wall has dramatically shifted from “infinite TAM” propped up by Nvidia to “where’s my money?”. And that’s a very different tone with the collective starts yelling it. As one portfolio manager politely translated: people are getting defensive. As they should. Meanwhile, Bank of America is mediating the chaos by explaining that AI stocks aren’t at dot-com blow-off levels yet. In fact, they compared today’s setup to the early internet era post-Netscape. Translation: This isn’t 2000… it’s more like 1997, you know, right before the house of cards collapsed.
(Source: Giphy)
Which is why the tension is pretty much a race to who actually makes money first. Will it be the chip guys? The cloud guys? The app guys? Or the ones selling shovels, power, and square footage to house all these servers? Until that answer gets clearer, and more evident… expect more havoc. Especially anytime a headline hints that someone’s data center spreadsheet doesn’t quite balance.
That said, AI isn’t dead. Not even close… but the honeymoon phase is officially over. And quite honestly, that’s a good thing. Meaning, keep your eyes on your portfolio and place your bets accordingly, friends. Until next time!
If you read all of this, congrats for having a 10 second attention span (better than me). As always, here’s our heatmap for today.
Market Gossip
> Micron forecasts surging revenue as computer memory demand for AI remains high (CNBC): Tell that to Blue Owl LOL…
> Amazon Names New AI Chief Amid Battle to Take On Tech Rivals (Bloomberg): Zuckerburg would like a word...
> Ford cancels EV battery deal worth $6.5 billion with South Korea’s LG Energy Solution (CNBC): BYD finna drink Ford’s milkshake…
> Cisco says Chinese hackers are exploiting its customers with a new zero-day (TechCrunch): “No patch available?” Sounds legit…
Meme of the Day
Question: Why go to the casino when Robinhood looks at you like this 24/7?
At the time of publishing, Stocks.News holds positions in Meta, Microsoft, Alphabet, and Robinhood as mentioned in the article.
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