How it feels to know we’re never getting rate cuts again… 

Well it’s Friday, and once again investors are heading into the weekend to touch some grass (I’ll leave it up to your imagination to know which grass). The reason? Inflation dropped it like it’s hot and the whole market went to shat. The receipts are as follows: Headline PPI printed at 0.5% for January against expectations of 0.3%. Meanwhile, Core PPI hit 0.8% which was more than the 0.3% our bean counting economists penciled in.

So we had a bad day? Precisely. The Dow dropped 522 points, or 1.1%. The S&P 500 shed 0.4%. And the Nasdaq lost 0.9%. All three benchmarks are red for February, and it's not even close to over. Sticky inflation plus AI existential dread is apparently the cocktail nobody ordered but everyone's drinking.

Speaking of AI… Block (Jack Dorsey's fintech baby) announced it's cutting more than 4,000 employees. Fun fact: That’s nearly half the company while investors pretty much said “F’ them kids” as shares ran +16% on the day. The reason for the layoffs, you ask? Because AI can do their work now… perhaps you’ve heard? Anthropic has been busy playing games and taking names and now, the virus has spread. Case in point: Software names had a Friday to forget, capping off what's been an absolute garbage month. Salesforce dropped 2%. Microsoft fell 2%, and Zscaler took it lying down… plummeting -12% after whiffing on deferred revenue and billings. 

Elsewhere, CoreWeave, the AI cloud darling and Nvidia’s treasure chest, face-planted -19% on the kind of guidance that makes analysts throw up in their mouth. Of course, Wall Street still broadly likes the name, but "broadly likes" and "down 19% in a session" is a fun contradiction.

Over in the private credit corner, we saw some more body bags. UK mortgage provider Market Financial Solutions collapsed, and investors decided the contagion math was worth panic-selling over. Apollo dropped 8%. Jefferies fell 10%. Blue Owl… which is already bruised from its liquidity curbs and asset sale drama… slid another 6%. Somebody get those investors some milk. 

That said, not everything go #rekt though. Dell (+22%)caught a bid after guiding for 25% EPS growth in fiscal 2027 while analysts hiked price targets. Overall, there are memory shortage concerns happening in the market but it appears the Street has “never heard of her” after watching Dell's masterpiece. Additionally, Netflix jumped 14% after it declined to raise its bid for Warner Bros. Discovery while Warner itself dipped -2% on the rejection. I’m not saying Netflix just gave us a Barry Keoghan bag fumble, but I’m definitely not saying they didn’t either. Naturally, Paramount Skydance soared 21%. 

And then, there’s Duolingo. Shares cratered -14% after Q1 revenue guidance of $288.5 million missed consensus of $291.4 million. Full-year outlook of $1.197–$1.221 billion came in below the $1.26 billion estimate. Turns out "learn Spanish in five minutes a day" doesn't always translate to "beat numbers every quarter."

So yeah… that was Friday’s song. And if you didn’t understand the lyrics, here’s the gist: inflation running hot while AI is simultaneously eating jobs is the kind of macro setup that makes everyone uncomfortable. You can't cut rates into that, and you can't exactly feel great about growth when companies are replacing headcount with API calls. Fun times we’re in, eh? Until next time, friends… 

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

> Dell shares climb 20% on earnings beat as company navigates rising memory costs (CNBC): Meanwhile, its PC biz posted a… (Sike nobody gives a rat’s a$$ about anything but AI memory)

> Anthropic’s Fight With Pentagon Over AI Widens Ahead of Deadline (Bloomberg): So there won’t be a holding of hands then? Asking for a friend… 

> Apple and Netflix team up to air Formula 1 Canadian Grand Prix (TechCrunch): 

Apple Investors: Are we finally getting Siri upgraded with Gemini? Or the Apple Car? 

Apple: Best we can do is F1 streaming… 

> Trump angering MAHA with glyphosate order gives Democrats an opening (CNBC): Hell hath no fury than a RFK Jr. scorned… 

“WTF” Meme of the Day

At the time of publishing, Stocks.News holds positions in Microsoft, Dell, Netflix, and Apple as mentioned in the article.