Kim Khan
Appearances
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
As you heard earlier in Wall Street Breakfast, Supermicrocomputer is surging, and that's helping momentum in tech stocks. The stock opened above $55 this session, and trading will be important to options players.
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
Looking at SMCI options data, the open interest on SMCI calls expiring Friday, February 28th, with a strike price of $50, is 16,332 contracts, with each contract representing 1,000 shares. The open interest on $55 calls is 14,716. If the stock trades above $60 this week, another 31,237 contracts would be in the money, the largest open interest position for February 28th calls.
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
All these contracts look like a good bet to expire worthless as a market close on Tuesday. Looking to the economy, new home sales dropped 10.5% month-on-month to a rate of 657,000 in January from 734,000 in December, revised from 698,000. That's lower than the 680,000 consensus. The median sales price on new houses sold in January 2025 was $446,300, up from $427,000 in December 2024.
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
The average sales price of $510,000 declined from $513,600 in the previous month. Pantheon macroeconomist Oliver Allen says the glut of unsold new homes has been pushing down prices. We expect further slight declines in new home prices over the next few quarters, he said. Among active stocks, Jack in the Box is surging after handily beating on the bottom line in fiscal Q1.
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
Welcome to Seeking Alpha's Wall Street Lunch, our afternoon update on today's market action, news, and analysis. Good afternoon. Today is Wednesday, February 26th, and I'm your host, Kim Kahn. Our top story so far. Restaurants are scrambling to deal with high egg prices, but McDonald's is bucking the trend of passing on cost to customers.
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
Adjusted EPS of 192 was down 3 cents from a year ago, but beat the consensus estimate by 23 cents. Total sales were down 3.7% to $469.4 million, about in line. Interim CEO Lance Tucker said, "...the first quarter saw a good start to top-line performance and bottom-line earnings flow-through as we battled through a difficult industry-wide macro environment."
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
And Lowe's returned to comparable sales growth, with comps up 0.2% during the recent quarter, driven by high single-digit pro and online sales, strong holiday performance, and rebuilding efforts in the wake of recent hurricanes." That was partially offset by continued near-term pressure in DIY discretionary spending.
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
McDonald's announced that it will not impose any surcharges when serving eggs as part of its meals. It will absorb the extra cost of higher egg prices, unlike competitors Waffle House and Denny's that have instituted egg surcharges. The most significant factor driving up egg prices is the ongoing outbreak of highly pathogenic avian influenza, also known as bird flu.
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
Gross margin came in at 32.9% of sales versus 32.8% consensus and 32.4% a year ago. In other news of note, Amazon showed off new products and services at its device event, including a new AI-powered version of Alexa.
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
Known as Alexa+, the new multimodal version of the Assistant is capable of doing tasks such as booking reservations, ordering concert tickets, texting babysitters, remembering smart home devices, and more. Panas Pane, SVP of Devices and Services, said, The re-architecture of all of Alexa has happened. We're pumped about it.
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
The new Alexa knows almost every instrument in your life, schedules smart home devices, entertainment, apps you use, and brings them together, he said, adding that compared to the previous version, Alexa Plus is smarter, more conversational, and personalized, while also integrating humor.
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
And in the Wall Street research corner, Wells Fargo said communication services remains a key component of its barbell strategy of comm services at 40%, financials at 40%, and consumer staples at 20%. Strategist Chris Harvey says the sector and many individual stocks are reaching or nearing key technical support levels.
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
As a result, we believe the non-fundamental sell-off has created an attractive opportunity to increase exposure to the communications names, he said. Among the top picks are AT&T, Fox, Netflix, and Meta. See all the picks in our story. And watch out for our special bonus podcast after the bell Wednesday as we dig into NVIDIA's earnings.
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
That's all for today's Wall Street Lunch. Look for links for stories in the show notes section. Don't forget, these episodes will be up with transcriptions at seekingalpha.com. And make sure you're getting the most out of your portfolio with quant, news, and analysis by heading to seekingalpha.com.
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
The deadly strain of H5N1 has led to the culling of millions of chickens since 2022, severely impacting the egg supply chain. As of January 2025, more than 134 million birds have been affected in the United States, which has thrown the supply and demand balance out of whack. The avian bird flu is deadly to poultry, including chickens, ducks, and turkeys.
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
Notably, more than 1,500 total commercial and backyard flocks have tested positive for bird flu across all 50 states and Puerto Rico. When a flock tests positive, all birds must be culled to stop the spread. On the sunny side, though, McDonald's is also offering a new $1 McMuffin promotion on its app for National Egg McMuffin Day on March 2nd.
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
The move is aimed at attracting lower- to middle-income consumers who have turned away from splurging on dining out due to high costs. Earlier this week, Denny's announced that some restaurants in the U.S. will temporarily add a surcharge to meals with eggs. The amount of the extra fee will vary by region and location.
Wall Street Breakfast
McDonald's says you won't shell out more for eggs
The chain said, "...we do our best to plan ahead with our vendors on items like eggs to minimize the impact market volatility has on our costs and menu pricing." In today's trading, stocks are rebounding after the recent sell-off, and Nasdaq is leading the major averages. Chip stocks are leaning higher as investors brace for the big earnings report from Nvidia after the bell today.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
Powell's asked if inflation was transitory in relation to the new Summary of Economic Projections, or dot plot, which showed the same number of rate cuts as last time, two for this year, but also a rise in inflation and unemployment and a decline in growth in 2025. Economist Ernie Tedeschi says that suggests the growth and inflation impacts are tariff-driven and the Fed is looking through them.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
But the SEP also indicated that the Fed members think things are more likely to get worse than better. Of 19 Fed members contributing to the SEP, those that see GDP risks to the downside shot up to 18 members from 5 in December. Just one member sees risks broadly balanced, down from 12.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
Upside risks to core PCE inflation rose to 18 members from 15, risks to the unemployment rate being to the upside up to 17 from 7, with just two seeing it broadly balanced, down from 12. In its statement, the FOMC replaced its phrase that risks to the economy on jobs and inflation were balanced and said, quote, uncertainty around the economic outlook has increased.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
It also announced that it will reduce QT to $50 billion per month starting in April. TS Lombard economist Dario Perkins summed things up, saying that the Fed has basically updated its forecasts, higher inflation and lower GDP for the tariffs that have been announced so far, plus a weaker start to 2025.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
Everything else is deferred until we get past tariff day and actually have some clarity on the new administration's plans. People can talk about transitory all they like, but if inflation jumps 1% during Q2, it's going to be mightily difficult to cut rates this year, unless there are clear cracks in the labor market, he said.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
Welcome to Seeking Alpha's Wall Street Lunch, our afternoon update on today's market action, news, and analysis. Good afternoon. Today is Wednesday, March 19th, and I'm your host, Kim Kahn. This is a special Fed Day edition of Wall Street Lunch. It's deja vu all over again. Chairman Jay Powell sent Fed watchers into a frenzy by bringing back the T-word.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
As far as markets are concerned, though, they either believe Powell can make transitory mean transitory again, or they think things will be bad enough that cuts will be inevitable. Fed funds' futures are still pricing in about a 20% chance of a quarter-point rate cut in May and a 65% chance of a cut in June.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
Stocks rose after the decision, kept climbing as Powell spoke, saw the usual last-half-hour scalping, but finished solidly higher. The S&P 500 closed up 1%, with the Nasdaq 1.4% higher and the Dow up 0.9%. Pantheon macroeconomist Samuel Toombs says the markets don't buy the hawkish tilt of the 2025 dots. It jars with the new economic forecasts.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
After the FOMC kept interest rates steady as expected, Powell said the base case is that the current uptick in inflation from tariffs will be transitory. Back in the summer of 2021, Powell made a similar claim in the midst of the COVID spike in inflation.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
Treasury yields ended lower, the 10-year dipped back to 4.25%, and the 2-year was back down at 4%. But strategist Marko Kalanovic said a Fed that's not in a hurry means it will drag its feet when things get worse, like in the fall of 2018. This is not bullish at all, he said.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
In other major news, Seeking Alpha Technology editor Chris Sciaccia weighs in with his thoughts of NVIDIA's GTC so far, including CEO Jensen Huang's keynote address.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
Core CPI had risen to 4.5% back then, but went on to top out at 6.6% and took two years and a massive tightening cycle to settle back down below 4%. Economist Mohamed El-Erian says the word transitory is back at the Federal Reserve as Chair Powell characterizes the price effects of tariffs as a one-off.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
Among other active stocks in today's session, Boeing saw buyers arrive after comments from CFO Brian West at an investor conference. West said the aviation giant is in fantastic shape in its effort to make 38 of its best-selling 737 MAX planes a month.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
General Mills warned it now sees adjusted EPS down 7% to down 8% for full year 2025 on a constant currency basis compared to prior guidance for a range of down 3% to down 1%. Organic net sales are expected to fall in a range of down 1.5% to down 2% versus a prior forecast of flat to up 1%.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
And Caesars Entertainment announced the appointment of two new independent directors, Jesse Lin and Ted Papapostolo, both from Icon Enterprises, to its board. The expansion brings the total number of directors to 12, with 10 being independent. And in the Wall Street Research Corner, global market ETFs are posting double-digit returns, led by Poland, up almost 40% this year.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
The U.S., on the other hand, is one of just 10 countries lower year-to-date, and one of six down more than 4%. Charlie Bilello, chief market strategist at Creative Planning, says, This is why you just can't have all your eggs in too few baskets. You just never know when there is going to be that reversion. You shouldn't have been chasing that hot stock.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
Following Poland in the top 10 are Austria, Spain, China, Greece, Germany, Chile, Italy, Colombia, and Finland, all up more than 20% in 2025. That's all for today's Wall Street Lunch. Look for links for stories in the show notes section. Don't forget, these episodes will be up with transcriptions at seekingalpha.com.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
And make sure you're getting the most out of your portfolio with quant, news, and analysis by heading to seekingalpha.com.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
I would have thought that, particularly after the big policy mistake of earlier this decade and given all the current uncertainties, some Fed officials would show greater humility. he added.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
It's simply too early to say with any regressive confidence that the inflationary effects will be transitory, especially given that companies and households still have fresh in their minds the recent history of high unanticipated inflation. Powell acknowledged that a good part of sticky inflation is tariffs, but the Fed is working on figuring out what are the tariff and non-tariff parts.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
He gave an example of last time around when tariffs were placed on washing machines, where prices went up, but not on dryers, where prices also went up as manufacturers just kind of followed the crowd.
Wall Street Breakfast
Fed deja vu: Powell calls tariff inflation transitory
Progress on inflation is probably being delayed by tariffs for the time being, he added, but he did note that the last time there were tariffs, the inflation was transitory, and CorePCE can get into the low twos in 2026.
Wall Street Breakfast
Inflation party wraps up early
The tariff-driven stock market correction is unlikely to cause the Fed to cut interest rates sooner, and any rate cuts are likely still to come towards the end of 2025. If this malaise persists for longer than the next few months, we will start to see the consumer and corporations pull back spending and growth will subside.
Wall Street Breakfast
Inflation party wraps up early
Only then, perhaps in the fourth quarter of this year, would the Fed step in with a possible rate cut to alleviate market stress. Among active stocks, consumer robot maker iRobot is plunging after the company posted weak Q4 results and issued a going concern warning.
Wall Street Breakfast
Inflation party wraps up early
The company issued a stark warning to investors, saying that there can be no assurance that new product launches will be successful due to potential factors, including but not limited to consumer demand, competition, macroeconomic conditions, and tariff policies.
Wall Street Breakfast
Inflation party wraps up early
Due to those uncertainties and the implication they may have on the company's financials, iRobot said there is substantial doubt about the company's ability to continue as a going concern for a period of at least 12 months from the date of the issuance of its consolidated 2024 financial statements. Bank of America sees Apple and IBM as the two most defensive names in IT hardware.
Wall Street Breakfast
Inflation party wraps up early
A soft inflation report before the bell brought out stock buyers, but they quickly retreated and gains faded into the open as investors looked under the hood. The February CPI rose 0.2% on the month, lower than the 0.3% consensus, and the 0.5% rise in January. That brought the annual headline rate down to 2.8%. The core CPI rose 0.2% month-on-month versus 0.3% in consensus and 0.4% in January.
Wall Street Breakfast
Inflation party wraps up early
As for Apple, analyst Wamsi Mohan said the company grew earnings in the last two downturns. For IBM, the spinoff of Kindrel has better positioned the company to deal with downturns. And Casey's General Stores is rallying post-earnings. Their CEO said inside same-store sales were driven by the prepared food and dispensed beverage category, with hot sandwiches and bakery performing quite well.
Wall Street Breakfast
Inflation party wraps up early
Our fuel team did a tremendous job achieving same-store gallon growth of 1.8% while maintaining a solid fuel margin. For 2025, Casey's boosted its outlook for EBITDA to growth of 11% versus prior guidance of 10%. The company is maintaining its prior same-store sales guidance of up 3-5%.
Wall Street Breakfast
Inflation party wraps up early
Welcome to Seeking Alpha's Wall Street Lunch, our afternoon update on today's market action, news, and analysis. Good afternoon. Today is Wednesday, March 12th, and I'm your host, Kim Kahn. Our top story so far. The party was over before it began.
Wall Street Breakfast
Inflation party wraps up early
In other news of note, Spotify said it paid $10 billion in royalties last year, the biggest single-year payout by a company in the history of the music industry, with its yearly payouts to the industry increasing tenfold over the past decade. Nearly 1,500 artists generated over $1 million in royalties from Spotify alone in 2024.
Wall Street Breakfast
Inflation party wraps up early
The streaming company added that it paid out nearly $4.5 billion to publishing rights holders, who represent songwriters, over the last two years.
Wall Street Breakfast
Inflation party wraps up early
The company says, as more listeners around the globe subscribe to paid streaming services, the industry has seen a tenfold increase in payouts over the past decade, with streaming alone contributing over $28 billion in revenue in 2024, doubling the industry's worth from just a decade ago.
Wall Street Breakfast
Inflation party wraps up early
And in the Wall Street Research corner, Wells Fargo says the sharp decline in NVIDIA shares in recent weeks is a buying opportunity ahead of the company's annual GTC event. Analyst Aaron Rakers says over the past five years, NVIDIA shares have outperformed the SOX Semiconductor Index by an average of 7 percentage points and 2.4 percentage points during the week of GTC and two weeks after GTC.
Wall Street Breakfast
Inflation party wraps up early
The average return has been 6.4% and 4.5% respectively. Shares are currently trading at roughly a 35% discount to the median earnings multiple over the past three years.
Wall Street Breakfast
Inflation party wraps up early
Grakers, who has an overweight rating and a $185 price target on the stock, is expecting five topics to be discussed at the event, including co-package optics, for which he said there's a lot of investor focus on where NVIDIA stands. Other key topics include the introduction of Blackwell Ultra GB300, which is expected to have an emphasis on inferencing. That's all for today's Wall Street Lunch.
Wall Street Breakfast
Inflation party wraps up early
Look for links for stories in the show notes section. Don't forget, these episodes will be up with transcriptions at seekingalpha.com. And make sure you're getting the most out of your portfolio with quant, news, and analysis by heading to seekingalpha.com.
Wall Street Breakfast
Inflation party wraps up early
The core annual rate cooled to 3.1%, lower than the 3.2% forecast. At first blush, this was a big relief for investors. But as Pantheon Macro pointed out, the figures came in below consensus because of a plunge in airline fares, which won't feed into the core PCE index. That's the Fed's preferred inflation gauge. RSM U.S.
Wall Street Breakfast
Inflation party wraps up early
Chief Economist Joseph Brasuelas sees some threatening trends deeper in the data, as inflation in the services sector remains sticky.
Wall Street Breakfast
Inflation party wraps up early
As we've recently noted, the combination of slower growth, we think GDP will arrive at 1.5% in the current quarter, and sticky inflation like that observed inside the services sector index creates the conditions for stagnation at best and stagflation at worst, he said. As for Fed forecasts, despite the softer numbers, the odds of a rate cut in June declined, although they're still at 80%.
Wall Street Breakfast
Inflation party wraps up early
In the bond market, yields rose with a 10-year back at 4.3%, indicating traders were more worried about a recession than short-term policy moves. Skylar Winan, CIO at Reagan Capital, says even with a weaker CPI, we believe the Federal Reserve is still in wait-and-see mode for at least the next six to eight months.
Wall Street Breakfast
Inflation going the wrong way
This trend can continue unless the government intervenes in some way. We can see 5% plus yields on the long end this fall. In the swaps market, a fully priced-in quarter-point Fed rate cut was pushed out to December from September. Fed funds futures now say the odds are 30% that the FOMC stays on the sidelines all year.
Wall Street Breakfast
Inflation going the wrong way
Reagan Capital's wine end is in that no-cut camp, saying with inflation and inflation expectations rising, the Fed has nothing to do at this point but wait and see, and hope that the economic indicators change to suggest more progress. If consumer prices or inflation expectations rise any further, it is quite possible that the Fed's next move is to raise short-term interest rates.
Wall Street Breakfast
Inflation going the wrong way
But there are a couple of dovish silver linings in this report. First, Deutsche Bank points out that January is traditionally the month where the CPI sees the most upside surprises. Second, Pantheon Macro notes that the big rise in the core CPI was driven by two components which do not feed into the PCA deflator calculation. Auto insurance prices jumped 2%, and hospital services prices rose 0.9%.
Wall Street Breakfast
Inflation going the wrong way
PPI data are used for both to feed into PCE, the Fed's favorite inflation gauge. Among active stocks, CVS Health is rallying after it topped bottom and top line expectations, driven by the segments operating its insurance arm, Aetna, and its pharmacy network. Looking ahead, the company sees $5.75 to $6 in adjusted EPS, which stood in line with $5.97 projected by analysts.
Wall Street Breakfast
Inflation going the wrong way
Welcome to Seeking Alpha's Wall Street Lunch, our afternoon update on today's market action, news, and analysis. Good afternoon. Today is Wednesday, February 12th, and I'm your host, Kim Kahn. Our top story so far. Boom goes the inflation dynamite. The January consumer price index jumped 0.5% in January, accelerating from 0.4% in December and hotter than the 0.3% consensus.
Wall Street Breakfast
Inflation going the wrong way
Seeking Alpha analyst Brendan O'Boyle argued that given the uncertainties surrounding PBMs under President Trump and the pressure on the company's main pharmacy rival Walgreens, investors have become very pessimistic regarding the business. Given these lowered expectations, it's not surprising that the share price can rally substantially on any positive news, he said.
Wall Street Breakfast
Inflation going the wrong way
Kraft Heinz is close to a 52-week low after it reported a 4.6% decline in sales during Q4. Organic sales fell 3.1% during the quarter, close to the consensus expectation for a drop of 3.2%. The quarter showed once again that consumers may be trading down to cheaper private label alternatives from some of Kraft's well-known brands.
Wall Street Breakfast
Inflation going the wrong way
Looking ahead, Kraft Heinz said it expects full-year organic sales growth to be flat to down 2.5% and sees full-year adjusted EPS landing in the range of 263 to 274 versus the 304 consensus. And Biogen reported better-than-expected Q4 results. but its full-year outlook disappointed as its multiple sclerosis franchise underperformed.
Wall Street Breakfast
Inflation going the wrong way
That pushed the annual rate up to 3%. Core CPI, which excludes food and energy, rose 0.4% in January, also topping the 0.3% consensus and 0.2% prior. That translates to a 3.3% year-on-year increase. The forecast was for a drop to 3.1%. Egg prices, the hot topic at the moment, or hot potato maybe, saw a 15.2% jump last month and are up 52.2% from last year.
Wall Street Breakfast
Inflation going the wrong way
The company warned of a mid-single-digit percentage year-on-year decline in its 2025 revenue due mainly to deteriorating multiple sclerosis product revenues. The midpoint of its adjusted EPS guidance of 1525 to 1625 was below the 1624 consensus. In other news of note...
Wall Street Breakfast
Inflation going the wrong way
Ken Griffin, CEO of Hedge Fund Citadel, had some strong words about the effects of President Donald Trump's aggressive stance on trade policy and his tactics involving tariffs. Speaking at the UBS Financial Services Conference in Florida, Griffin said, "...from my vantage point, the bombastic rhetoric, the damage has already been done.
Wall Street Breakfast
Inflation going the wrong way
It's a huge mistake to resort to this form of rhetoric when you're trying to drive a bargain because it tears into the minds of CEOs, policymakers, that we can't depend on America as our trading partner."
Wall Street Breakfast
Inflation going the wrong way
It makes it difficult for multinationals in particular to think about how to plan for the next 5, 10, 15, 20 years, particularly when it comes to long lead time capital investments that could be adversely impacted by a degradation of the current terms of engagement as amongst the leading Western countries when it comes to terms and trade. And in the Wall Street research corner...
Wall Street Breakfast
Inflation going the wrong way
Both institutional investors and retail investors have heavily invested in these stocks over the past two years, leading to higher exposure levels. And five, the group has significantly outperformed the equal-weighted S&P 500 over the last two years. That's all for today's Wall Street Lunch. Look for links for stories in the show notes section.
Wall Street Breakfast
Inflation going the wrong way
Don't forget, these episodes will be up with transcriptions at seekingalpha.com. And make sure you're getting the most out of your portfolio with quant, news, and analysis by heading to seekingalpha.com.
Wall Street Breakfast
Inflation going the wrong way
Michael McDonough, chief economist of financial products at Bloomberg, says his bacon, egg, and cheese with a cup of coffee price index saw its largest ever monthly price jump in January, surging 6.1%, or 18 cents. The markets had predictable reactions. Stock index futures fell off a cliff after the numbers, and the major averages are lower.
Wall Street Breakfast
Inflation going the wrong way
David Russell, global head of market strategy at TradeStation, sees time running out on the bull market if inflation is attained soon. Inflation has gotten sticky with items like used cars and auto insurance ticking back up. This puts pressure not only on the Fed, but also on the White House to tread carefully on tariffs, he said. On the bond side, Treasury yields shot up.
Wall Street Breakfast
Inflation going the wrong way
The 10-year yield is now close to 4.65%. Skyler Winan, CIO at Reagan Capital, says, While President Trump and Treasury Secretary Besson want 10-year Treasury rates to fall in order to relieve borrowing angst, the market is in control of long-duration yields. Recent spikes in consumer inflation expectations, coupled with some pullback in demand, have led to a rise in yields.
Wall Street Breakfast
Stocks to the moon as Trump backs off trade war (except for China)
federal agencies, such as the Departments of Commerce and Treasury, to negotiate a solution to the subjects being discussed relative to trade, trade barriers, tariffs, currency manipulation, and non-monetary tariffs. Also effective immediately, he added. Earlier on Wednesday, Beijing retaliated against U.S. tariffs of 104% by raising its tariff rate on imports from the U.S. to 84%.
Wall Street Breakfast
Stocks to the moon as Trump backs off trade war (except for China)
The world's second largest economy called the American trade barriers a mistake on top of a mistake. There is some vagary in what countries are included in this pause, though. Robin Brooks, senior fellow at the Brookings Institute, says, "...this trade war was really always about the U.S. versus China. The U.S.
Wall Street Breakfast
Stocks to the moon as Trump backs off trade war (except for China)
made a strategic error by picking fights with everyone instead of just focusing on China. The 90-day pause fixes that and is thus very good. It also gives Xi an off-ramp if he reverses China's retaliatory tariffs. In trading, the bulls charged immediately." Among the biggest gainers in the S&P 500 were airlines and chip stocks, up more than 20%.
Wall Street Breakfast
Stocks to the moon as Trump backs off trade war (except for China)
Sherwood News notes that Broadcom, Nvidia, Microsoft, Supermicro, and Palantir are recouping all of their post-tariff losses. Dollar stores, supermarkets, fast food chains, and dividend plays struggled. But bond trading is still not following the script. Treasury yields are off their highs but still elevated. The 10-year yield, which had neared 4.5% overnight, is still above 4.4%.
Wall Street Breakfast
Stocks to the moon as Trump backs off trade war (except for China)
Welcome to Seeking Alpha's Wall Street Lunch, our afternoon update on today's market action, news, and analysis. Good afternoon. Today is Wednesday, April 9th, and I'm your host, Kim Kahn. Our top story so far, and it's a doozy. You may not be able to fight the Fed, and you certainly can't beat the bond market.
Wall Street Breakfast
Stocks to the moon as Trump backs off trade war (except for China)
The 2-year yield is near 4%. So, having been burned before, traders may be wary about whether new tariffs could be just around the corner. Right before Trump's announcement, the Treasury Department's auction of $39 billion of 10-year notes drew surprisingly strong demand.
Wall Street Breakfast
Stocks to the moon as Trump backs off trade war (except for China)
In a massive U-turn, President Donald Trump let most countries off the hook from the large tariffs he announced last week, instead zeroing in on an escalating battle with China. And stocks are rocketing higher, with the S&P 500 up about 8%, the Nasdaq Composite up 10%, and the Dow up 7%.
Wall Street Breakfast
Stocks to the moon as Trump backs off trade war (except for China)
The auction's high yield of 4.435% came in significantly below the when-issued market yield, also known as the snap price, of 4.465%. That denoted a trade-through of three basis points, which is tied for the second-best on record.
Wall Street Breakfast
Stocks to the moon as Trump backs off trade war (except for China)
Wedbush analyst Dan Ives says, The pressure on Trump took on a life of its own, and the eye-popping rise of the 10-year yield was ultimately too much to hold his line on the self-inflicted tariff slate unleashed at midnight. Now expect massive negotiations across the board. China the wild card for the U.S. tech sector. Kathy Jones, chief fixed income strategist at Schwab, simply said, bonds rule.
Wall Street Breakfast
Stocks to the moon as Trump backs off trade war (except for China)
That's all for today's Wall Street Lunch. Look for links for stories in the show notes section. Don't forget, these episodes will be up with transcriptions at seekingalpha.com. And make sure you're getting the most out of your portfolio with quant, news, and analysis by heading to seekingalpha.com.
Wall Street Breakfast
Stocks to the moon as Trump backs off trade war (except for China)
Mohamed El-Erian, advisor at Allianz, says, Up to an hour ago, there was a debate on what would convince the U.S. administration to opt for some type of pause on tariffs. Would it be Congress, the president's advisors, business leaders, the legal system, markets, or something else? We got the answer today.
Wall Street Breakfast
Stocks to the moon as Trump backs off trade war (except for China)
It's the government bond market, particularly how close it gets to the line that separates wild price volatility from market malfunctioning.
Wall Street Breakfast
Stocks to the moon as Trump backs off trade war (except for China)
Facing a big sell-off in stocks and, more importantly at this point, a persistently big rise in Treasury yields when part of the plan was to get rates down, the White House went from declaring no exemptions, no pauses, and negotiations one country at a time to eliminate every trade deficit to a 90-day pause with tariffs dropping to 10% on the majority of the countries on the original list.
Wall Street Breakfast
Stocks to the moon as Trump backs off trade war (except for China)
But Trump also boosted tariffs on China again in response to an earlier move by Beijing. Based on the lack of respect that China has shown the world's markets, I am hereby raising the tariff charged to China by the United States of America to 125% effective immediately, Trump said on Truth Social. The president said other countries have called U.S.
Wall Street Breakfast
Get a PhD AI agent for $20K a month
Based on other employment surveys and unwinding of January weather disruption, Toombs still sees a gain of $150,000 in Friday's official figures. On the more hawkish side, the ISM Services Index countered the weakness in the Manufacturing Index that spurred Monday's sell-off. ISM services rose to 53.5 in February, topping the 52.7 consensus and up from 52.8.
Wall Street Breakfast
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But SoFi strategist Liz Young-Thomas noted that the prices paid component rose to 62.4 in February, the highest level since June 2022 when inflation peaked. There could be real pressure building, and if it doesn't cool off soon, we could actually see inflation turn higher, she said.
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And Peter Berezin, chief strategist at BCA Research, pointed out that the comments certainly don't mesh well with the upbeat headline number. Of the 10 selected comments of respondents, the word tariffs appears seven times and uncertainty five times. Among active stocks, William Blair upgraded Palantir to market perform from underperform in the wake of the sell-off.
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Analyst Louis De Palma, not of taxi fame, said after the Doge-driven sell-off, valuation is still frothy with potential downside risk of greater than 40% on government contract delays, but there have been positive developments. Abercrombie & Fitch is slumping to a 52-week low on concerns over profit guidance. The retailer sees Q1 EPS of 125 to 145, midpoint 135, versus 196 consensus.
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Welcome to Seeking Alpha's Wall Street Lunch, our afternoon update on today's market action, news, and analysis. Good afternoon. Today is Wednesday, March 5th, and I'm your host, Kim Kahn. Our top story so far. OpenAI, the Microsoft-backed maker of ChatGPT, could sell artificial intelligence agents that could cost as much as $20,000 a month.
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Get a PhD AI agent for $20K a month
And Disney is planning to reduce its total workforce by about 6%, impacting almost 200 positions at the ABC News Group and the Disney Entertainment Networks. The Wall Street Journal says the move is part of a broader restructuring effort within the company as it focuses on core businesses with more spending on sports and entertainment content.
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In other news of note, JP Morgan and Goldman Sachs are stepping up as brokers, among other banks, to meet investment demand for Russian-related assets through ruble-linked derivatives contracts.
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The information reports that OpenAI expects 20% to 25% of its revenue to come from AI agents. Overall, the company is on track to generate $4 billion in annualized revenue. The $20,000 a month agent would be a PhD-level research agent and would be geared towards those looking to supplement software engineers or medical researchers.
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Bloomberg says the two banks have offered ruble-linked derivative contracts, a trade that's not facing sanctions by Western economies because it doesn't involve physical Russian assets or Russian nationals. The contracts, called non-deliverable forwards, offer a legal workaround to profit if the Russian currency continues to climb in value. U.S.
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and European investors are prohibited from acquiring rubles directly as a result of Western sanctions against the country. Year to date, the ruble has surged 20%, the largest rise of any currency. And in the Wall Street Research Corner, BMO strategist Brian Belsky says tech investors should consider GARP, growth at a reasonable price, as an investing strategy to look for outperformers.
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Given the idiosyncrasies of technology, higher growth, higher valuation, higher market cap, One approach we use to identify opportunities is to take a multi-factor rank based on the market cap, two-year PE, and two-year EPS growth for stocks within the sector and select the stocks that fall within the upper half of the composite rank for performance purposes, he said.
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GARP's strategies within the technology sector outperformed the equal-weighted and market cap-weighted sector indices in the subsequent 6 and 12 months after periods where the technology relative valuation was above average, he added. Among his picks are Akamai, Dell, AMD, F5, Intel, Micron, Supermicrocomputer, and Skyworks Solutions. See all the names in our story on Seeking Alpha.
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That's all for today's Wall Street Lunch. Look for links for stories in the show notes section. Don't forget, these episodes will be up with transcriptions at seekingalpha.com. And for a full suite of news, analysis, ratings, and data on stocks and ETFs, go to seekingalpha.com.
Wall Street Breakfast
Get a PhD AI agent for $20K a month
Other agents could be priced at $2,000 per month and marketed towards high-income knowledge workers, while $10,000 per month agents could be used for software development. AI agents are software that can interact with data and the environment surrounding them and perform tasks by themselves to meet specific goals.
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Get a PhD AI agent for $20K a month
The company currently generates revenue from its application programming interface and multiple tiers of ChatGPT, including ChatGPT Pro, which costs $200 a month. No word yet on development of an AI Hollywood agent, but there must be a market for software that can guarantee back-end points and doesn't need to be thanked at the Oscars.
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Get a PhD AI agent for $20K a month
Looking to the economy, ADP's measure of February private payrolls rose by just 77,000, far lower than the 162,000 consensus and the 186,000 jobs added in January. It was the smallest rise since July, but there's always a but with the ADP numbers given questions over methodology.
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Pantheon macroeconomist Samuel Toom says the abysmal record of ADP's data in forecasting private payrolls suggests that February's weak numbers should be largely disregarded. ADP's forecast error, regardless of sign, has averaged a hefty 85,000 and has been as large as 348,000 since its methodology was refined in August 2022.
Wall Street Breakfast
Maserati sets autonomous driving speed record
Stephanie Guichard, senior economist at the Conference Board, says consumer optimism about future income, which has held up quite strongly in the past few months, largely vanished, suggesting worries about the economy and labor market have started to spread into consumers' assessments of their personal situations.
Wall Street Breakfast
Maserati sets autonomous driving speed record
Pantheon macroeconomist Samuel Toombs says the Conference Board survey echoes the University of Michigan survey in suggesting the new administration's plans for tariffs and spending cuts are going down like a lead balloon with households.
Wall Street Breakfast
Maserati sets autonomous driving speed record
The headline confidence index now is 17 points lower than October, just before the elections, and a massive 32 points lower than in March 2017, two months into Mr. Trump's first presidential term, he said. The drop in confidence is weighing on auto and home purchase plans. Plans to purchase a major household appliance are holding up well for now, only because households are front-running tariffs.
Wall Street Breakfast
Maserati sets autonomous driving speed record
Toombs added that medium one-year-ahead inflation expectations rose to 5.1% from 4.8% in February and are now well above their 2000-2019 average of 4.3%. But there may be a silver lining on prices. The Fed remains more focused on medium-term inflation expectations, which are not covered in this report, he said.
Wall Street Breakfast
Maserati sets autonomous driving speed record
What's more, we continue to expect a weakening labor market to reduce services inflation, keeping core PCE inflation anchored near 3% this year in the most plausible scenarios for tariffs. Among active stocks, B of A Securities upgraded Cloudflare two notches to buy from Underperform, raising the price target to $160 from $60, citing improving fundamentals.
Wall Street Breakfast
Maserati sets autonomous driving speed record
Analyst Madeline Brooks said, Mobileye is drawing buyers after Volkswagen said it is working with the automated driving assistance software company to enhance driver assistance in future vehicles. The German automaker is working with Vallejo and Mobileye to upgrade the advanced driver assistance systems up to level 2 plus in its upcoming vehicle portfolio based on its MQB platform.
Wall Street Breakfast
Maserati sets autonomous driving speed record
Welcome to Seeking Alpha's Wall Street Lunch, our afternoon update on today's market action, news, and analysis. Good afternoon. Today is Tuesday, March 25th, and I'm your host, Kim Kahn. Our top story so far, forget 88 miles per hour is the future, how about 198? Stellantis announced that its Indy Autonomous Challenge Maserati MC20 shattered records for autonomous driving on March 3rd.
Wall Street Breakfast
Maserati sets autonomous driving speed record
And KB Home slumped after the homebuilder's Q1 earnings fell short of expectations, and the company trimmed its 2025 guidance as affordability concerns and macroeconomic uncertainties weighed on demand. The company's guidance for 2025 includes housing revenue of $6.6 to $7 billion versus the prior outlook of $7 to $7.5 billion and the visible alpha consensus of $7.03 billion.
Wall Street Breakfast
Maserati sets autonomous driving speed record
Average selling price is expected to be $480 to $495,000 versus its prior range of $488 to $498 and the visible alpha estimate of $490,600. In other news of note, Massachusetts is going after Robinhood over its decision to expand its trading offerings to prediction markets.
Wall Street Breakfast
Maserati sets autonomous driving speed record
The brokerage recently teamed up with Kalshi to offer event contracts after testing the waters in the 2024 presidential election and a similar push for Super Bowl 59.
Wall Street Breakfast
Maserati sets autonomous driving speed record
The driverless Maserati blazed down the Space Florida launch and landing facility runway at 197.7 miles per hour to set the speed record. The Maserati was controlled by AI driver software without any problems. Held at the iconic NASA Space Shuttle runway in Cape Canaveral, the India Autonomous Challenge tested the limits of autonomous technology through high-speed racing.
Wall Street Breakfast
Maserati sets autonomous driving speed record
While the new prediction hub on Robinhood is focused on things like the NCAA March Madness tournament, there are plans to eventually expand into economic events such as corporate earnings and Fed rates, which are already offered on Kalshi's website.
Wall Street Breakfast
Maserati sets autonomous driving speed record
Massachusetts Secretary of State Bill Galvin said, this is just another gimmick for a company that's very good at gimmicks to lure investors away from sound investing, adding that Robinhood was linking a gambling event on a popular sports event that's especially popular to young people to a brokerage account. And in the Wall Street Research corner, Vanguard has become the latest to slash its U.S.
Wall Street Breakfast
Maserati sets autonomous driving speed record
economic growth forecast for 2025, citing ongoing uncertainties surrounding the issues such as tariffs, immigration policies, and other key policy decisions. Vanguard, one of the world's largest ETF providers, now sees U.S. economic growth of 1.7% this year, down from 2.1%. They expect core inflation to register about 2.7% this year, up from its previous forecast of 2.5%.
Wall Street Breakfast
Maserati sets autonomous driving speed record
That's all for today's Wall Street Lunch. Look for links for stories in the show notes section. Don't forget, these episodes will be up with transcriptions at seekingalpha.com. And make sure you're getting the most out of your portfolio with quant, news, and analysis by heading to seekingalpha.com.
Wall Street Breakfast
Maserati sets autonomous driving speed record
The MC20's 630-horsepower V6 Nettuno engine was highlighted as delivering 0-100 kmph acceleration in 2.88 seconds and a top speed of over 326 kmph. It was also noted that the autonomous car benefits from the Maserati twin-combustion technology, the innovative combustion system built entirely in-house at Maserati, and evolved from the pre-chamber technology used on Formula One powertrains.
Wall Street Breakfast
Maserati sets autonomous driving speed record
Looking to the economy, the conference board's measure of March consumer confidence sank to 92.9 from 100.1 in February, below the forecast of 94.2. The Expectations Index slid 9.6 points to 65.2, the lowest level in 12 years and well below the 80 threshold that usually indicates a recession ahead. The Present Situation Index dipped to 134.5 from 136.5 prior.
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
Toomes added, growth in real after-tax income likely will continue to slow this year, weighing strongly on spending growth now that households have mostly depleted their excess savings. Wells Fargo economists said, Perhaps if the drumbeat of government sector job displacement and corporate layoffs abates, sentiment around the labor market will improve.
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
For now, this pessimism about the labor market in combination with household worries about inflation led to a decline in consumer perceptions of their expected household financial situation six months out. The consumer confidence numbers are dictating trading, with gross stocks falling and bonds rallying. The Nasdaq Composite is down more than 1%, trailing the S&P 500 off more than half a percent.
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
The Nasdaq 100 is off more than 5% since its record low last week. In the bond market, the 10-year treasury yield is back down to 4.3%. Among active stocks, Tesla is among the biggest S&P decliners after the EV maker saw its sales in Europe decline 45% in January from a year ago. That's according to data from the European Automobile Manufacturers Association.
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
The Conference Board's February measure of consumer confidence saw the largest drop since August 2021 amid a broad range of concerns, including inflation, future business conditions, and the labor market. The index dropped to 98.3 from 105.3 in January, and below the forecast for a smaller drop to 103.
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
Tesla sold 9,945 vehicles in Europe in January, down 45% from last year's 18,161. Tesla's share of the market dropped to 1% from 1.8%. SEMPRA plunged to its lowest level since October 2023 after reporting weaker-than-expected Q4 adjusted earnings and revenues while also lowering its full-year guidance.
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
Welcome to Seeking Alpha's Wall Street Lunch, our afternoon update on today's market action, news, and analysis. Good afternoon. Today is Tuesday, February 25th, and I'm your host, Kim Kahn. Our top story so far. Is it a crisis of confidence?
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
The California utility said it is cutting its 2025 earnings guidance range due to regulatory matters and the backdrop of a higher-cost environment, now seeing adjusted EPS of $430 to $470 down from its previous outlook of $490 to $525 and below the $516 consensus. And chip stocks are also under pressure, following a report by Bloomberg that the U.S.
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
Department of Commerce is pursuing tighter sanctions to curb China's ability to produce more powerful chips. The administration is working to strengthen restrictions on China's chip industry, expanding on policies enacted under former U.S. President Joe Biden. The report said the goal is to convince U.S. allies to mimic the China export curbs already put in place by the U.S.
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
on chip gear companies, such as Lam Research, KLA, and Applied Materials. In other news of note, Kathleen Kennedy, the powerful head of Lucasfilm, is planning to retire at the end of this year, according to industry publication Puck.
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
While at the helm of Lucasfilm, and following its acquisition by Disney, Kennedy relaunched the Star Wars franchise, choreographing a new release every year between 2015 and 2019, beginning with the J.J. Abrams-directed Star Wars The Force Awakens, which went on to become the highest-grossing film within the franchise.
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
Along with collaborations with Steven Spielberg, with whom she co-founded Amblin Entertainment, and her husband Frank Marshall, Kennedy served as producer or executive producer for more than 70 films, altogether earning 120 Academy Award nominations and 25 wins.
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
And in the Wall Street Research Corner, Goldman Sachs updated its hedge fund VIP list of the top long positions of fundamentally driven hedge funds. Strategist Ben Snyder says the list represents a tool for investors seeking to follow the smart money based on 13F filings. The list has 50 stocks whose performance will largely influence the long side of many fundamentally driven hedge funds.
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
The top six stocks are six of the magnificent seven, Amazon, Meta, Microsoft, NVIDIA, Alphabet, and Apple, in that order. Uber, Taiwan Semi, Hess, and Netflix round out the top ten. See all 50 stocks in our story on Seeking Alpha. That link will be at the top of show notes. That's all for today's Wall Street Lunch. Look for links for stories in the show notes section.
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
Don't forget, these episodes will be up with transcriptions at seekingalpha.com slash WSB. And join the highest level discussion of any stock or ETF with our community of serious investors like you. Find us at seekingalpha.com slash subscriptions.
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Consumer confidence sees biggest drop since 2021
It was the third consecutive month-on-month decline, bringing the index to the bottom of the range that has prevailed since 2022. Of the index's five components, only consumers' view of present business conditions improved. Along with general souring of consumers' moods, their 12-month inflation expectations ramped up to 6% in February from 5.2% in January.
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
The present situation index declined 3.4 points to 136.5. The forward expectations index sank 9.3 points to 72.9, an eight-month low, and below the threshold of 80 that usually signals a recession. Pantheon macroeconomist Samuel Toombs says consumers are, quote, finally smelling the coffee.
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
The conference board survey mirrors the Michigan survey in showing that consumers' confidence has deteriorated sharply in the face of threats to impose large tariffs and a slashed federal spending and employment, he said.
Wall Street Breakfast
Consumer confidence sees biggest drop since 2021
While references to inflation and prices in general continue to rank high in write-in responses, there was a sharp increase in mentions of trade and tariffs, back to a level unseen since 2019, Stephanie Gichard, senior economist, global indicators at the conference board said. Most notably, comments on the current administration and its policies dominated the responses.
Wall Street Breakfast
Stock gains since Election Day erased
The Bitcoin VWAP since the election was $97,600, and the inability for the crypto to stay above $97,000 was the first sign that the bro bubble was popping, Hartnett added. The VWAP for Tesla was $3.71, and that fell in the first week of February.
Wall Street Breakfast
Stock gains since Election Day erased
Among active stocks, Target beat Q4 EPS in sales estimates, but said it expects to see meaningful year-over-year profit pressure in Q1 relative to the remainder of the year due to ongoing consumer uncertainty, tariff uncertainty, and the expected timing of certain costs within the fiscal quarter. Target expects full-year EPS of $880 to $980, mid-point $930, versus the consensus mark of $924.
Wall Street Breakfast
Stock gains since Election Day erased
Net sales growth is expected to be in a range of around 1%, reflecting comparable sales growth around flat. Okta is rallying post-earnings, winning upgrades from DA Davidson and Stiefel today. DA Davidson analyst Rudy Kess said he sees 11-13% year-on-year revenue growth, as likely in full year 2026, versus current guidance of 9-10% year-on-year.
Wall Street Breakfast
Stock gains since Election Day erased
With increasing new product mix, enterprise traction, channel momentum, and sales productivity, we now believe double-digit growth is sustainable. And sales of Tesla's China-made electric vehicles fell 49.2% year-on-year in February as intense competition continues to disrupt the EV maker's share in China's EV market.
Wall Street Breakfast
Stock gains since Election Day erased
In other news of note, the partnership between Alphabet's Waymo and Uber goes into action today in Austin. Riders who request an UberX, UberGreen, UberComfort, or UberComfort Electric in the 37-square-mile area of Austin could be matched with a Waymo fully autonomous, all-electric, Jaguar I-Pace at no additional cost.
Wall Street Breakfast
Stock gains since Election Day erased
Welcome to Seeking Alpha's Wall Street Lunch, our afternoon update on today's market action, news, and analysis.
Wall Street Breakfast
Stock gains since Election Day erased
Before a nearby Waymo vehicle is sent, customers will have the option to accept or switch to a driver. Once the Waymo arrives, riders can unlock the vehicle, open the trunk, and start the trip from the Uber app. The service will expand to Atlanta later this year.
Wall Street Breakfast
Stock gains since Election Day erased
Waymo also plans to begin offering rides in Miami next year through its own app to add to its service that is already running in Phoenix, San Francisco, and Los Angeles. And in the Wall Street Research Corner, Morgan Stanley analysts highlighted companies they think are more insulated from tariffs compared to their industry peers and more able to defend their pricing and market share.
Wall Street Breakfast
Stock gains since Election Day erased
Strategist Mike Wilson sees tariffs as more of a rotational driver than an index-centric one, as the impact should be concentrated in a few industries, including consumer discretionary and more specifically autos, technology hardware, and capital goods.
Wall Street Breakfast
Stock gains since Election Day erased
Services industries across financials, software, media, and entertainment, and consumer services are less directly impacted, and we maintain our favorable views on these pockets of the market in relative terms, Wilson said. Among the names are Levi Strauss, United Rentals, Fastenal, Zoom Communications, Albertsons, Dollar General, and Ulta Beauty.
Wall Street Breakfast
Stock gains since Election Day erased
Check out the whole list in our story on Seeking Alpha. That's all for today's Wall Street Lunch. Look for links for stories in the show notes section. Don't forget, these episodes will be up with transcriptions at seekingalpha.com. And make sure you're getting the most out of your portfolio with quant, news, and analysis by heading to seekingalpha.com.
Wall Street Breakfast
Stock gains since Election Day erased
but the scale of the trade and geopolitical policy shift now actually happening is of historical proportions. There is a huge rise in uncertainty taking place in the U.S., he added. The major averages are falling further after Monday's sell-off. The S&P 500 is down more than 1% and is below where it traded on November 5th. The Nasdaq and Dow are also shedding more than 1%.
Wall Street Breakfast
Stock gains since Election Day erased
The VIX volatility index, also known as the fear gauge, is topping 25%, a high for the year. With cash moving from risk to safety, treasury yields continue to fall. The 10-year treasury yield is now below 4.15%, and the two-year is below 4% for the first time since October. And crypto is back on the back foot, with Bitcoin around $83,000.
Wall Street Breakfast
Stock gains since Election Day erased
All of this is leading to a collapse of what BOA strategist Michael Hartnett calls the bro bubble. Hartnett said on Friday the breach of four technical levels would send nouveau bulls, those jumping on the Trump trade bandwagon, heading for the exits. Those levels were the post-election volume-weighted average prices of Meta, Palantir, the SPY ETF, and the QQQ ETF.
Wall Street Breakfast
Stock gains since Election Day erased
afternoon today is tuesday march 4th and i'm your host kim khan our top story so far the bro bubble has popped stocks have now wiped out all of the gains since election day as tariffs go into effect the trade war escalation is weighing heavily on global growth expectations george saravellos head of fx strategy at deutsche bank says up until today many trump administration policies could be rationalized under the negotiating tactic mantra
Wall Street Breakfast
Stock gains since Election Day erased
Volume-weighted average prices are a ratio of price-to-trade volume similar to a moving average and used for intraday and short-term strategy. Yesterday, SPY fell through the $5.97 VWAP that needed to hold, and QQQ broke through B of A's $5.19 VWAP level. Today, Meta has lost its VWAP of $6.39, and Palantir is the last holdout, just above its VWAP of $80.
Wall Street Breakfast
Bearish sentiment on stocks soars
But core durable orders ex-transportation were virtually unchanged, compared with the 0.3% expected. Wells Fargo economists noted the 0.8% rise in non-defense ex-aircraft orders, which is now rising at the fastest three-month pace since 2022.
Wall Street Breakfast
Bearish sentiment on stocks soars
To the extent this pickup in core capital goods orders does reflect a pull forward in demand, we should brace for some payback as that intention subsides mid to late in the year. On the labor front, weekly jobless claims rose by 22,000 to 242,000, sharply higher than the 224,000 consensus. That's up from a revised 220,000 the week before.
Wall Street Breakfast
Bearish sentiment on stocks soars
In a sign federal layoffs may be starting to show up, claims filed in the District of Columbia rose by 421 to 2,047. The claims filed in Maryland dropped by 147 to 2512, and claims filed in Virginia declined by 533 to 2366. Pantheon macroeconomist Samuel Toom says extreme weather was chiefly responsible for the pickup in initial claims last week.
Wall Street Breakfast
Bearish sentiment on stocks soars
Bearish sentiment among individual investors surged to the highest level in two and a half years this past week as the tech and momentum trades showed some vulnerability.
Wall Street Breakfast
Bearish sentiment on stocks soars
Snowfall was much higher than usual across most of the Midwest and the East. Doge's efforts to shrink the federal workforce also probably boosted claims last week, but by no more than 5,000, he added. Federal employees are widely distributed across the country, but roughly 20% are located in D.C., Virginia, and Maryland, despite these areas accounting for only about 5% of the population.
Wall Street Breakfast
Bearish sentiment on stocks soars
Welcome to Seeking Alpha's Wall Street Lunch, our afternoon update on today's market action, news, and analysis. Good afternoon. Today is Thursday, February 27th, and I'm your host, Kim Kahn. Our top story so far, it's a country bear jamboree.
Wall Street Breakfast
Bearish sentiment on stocks soars
Among active stocks, Warner Bros. Discovery said it expects strong momentum in its direct-to-consumer business this year, which helped investors overlook the top and bottom line misses in its fourth quarter earnings report.
Wall Street Breakfast
Bearish sentiment on stocks soars
The company said, "...we expect strong DTC subscriber growth to continue through 2025, and we now have a clear path to reach at least 150 million global subscribers by the end of 2026, with corresponding strong DTC revenue and adjusted EBITDA growth." Snowflake is rallying sharply after fourth quarter results and guidance beat expectations.
Wall Street Breakfast
Bearish sentiment on stocks soars
Jefferies analyst Brent Thill said Snowflake is back on track towards an acceleration narrative, and they view the story as a key AI play investors need to continue to be long in 2025. And analysts are encouraged by NVIDIA's numbers.
Wall Street Breakfast
Bearish sentiment on stocks soars
The American Association of Individual Investors said in its survey for the week ending February 26th that the bearish camp, those who think the market will be lower in the next six months, jumped to 60.6% from 40.5% the week before. Bulls fell to 19.4% from 29.2%. The spread between bulls and bears jumped to 41.2% in favor of the bears, up from 11.3%.
Wall Street Breakfast
Bearish sentiment on stocks soars
Morgan Stanley analyst Joseph Morris said that Blackwell demand is likely to remain exceptional through the end of the year, even if some investors had a concern about the company's gross margins. Evercore ISI analyst Mark Lepassis said that the $11 billion in revenue from Blackwell was well above expectations. In addition, company management made the case for excellent visibility in 2025.
Wall Street Breakfast
Bearish sentiment on stocks soars
In other news of note, Amazon's cloud computing business, Amazon Web Services, announced its new quantum computing chip called Ocelot following similar launches from Alphabet and Microsoft. Ocelot can reduce the cost of implementing quantum error correction by up to 90% compared to current approaches, AWS said.
Wall Street Breakfast
Bearish sentiment on stocks soars
Quantum chips are used to perform computations, but instead of traditional binary bits that are 1 or 0, they use quantum bits, or qubits, which can be both 1 and 0 at the same time, speeding up complex processes like drug discovery. And in the Wall Street research corner, will most people be ready to retire before they buy their first home?
Wall Street Breakfast
Bearish sentiment on stocks soars
Apollo Asset Management highlights that the combination of higher house prices and elevated mortgage rates has resulted in a significant rise in the median age of homebuyers. That reached a historic 56 years in 2024 compared to 45 years in 2021. This marks a sharp contrast to 1981, when the typical age of a homebuyer was just 31 years old. That's all for today's Wall Street Lunch.
Wall Street Breakfast
Bearish sentiment on stocks soars
Look for links for stories in the show notes section. Don't forget, these episodes will be up with transcriptions at seekingalpha.com slash WSB. And join the highest level discussion of any stock or ETF with our community of serious investors like you. Find us at seekingalpha.com slash subscriptions.
Wall Street Breakfast
Bearish sentiment on stocks soars
Bearish sentiment hasn't been that high since September 2022, when the level hit 60.87%. That year, the S&P 500 fell 25% from January to October and saw the worst performance in the first six months of the year since 1970. Before that, you'd have to go back to the financial crisis to see bearish levels above 60%, with bear sentiment hitting 70.27% in March 2009.
Wall Street Breakfast
Bearish sentiment on stocks soars
The spread of 41.2% to the bears hasn't been this high since it hit 43.1% in September 2022. Before that, it would be March 2009's 51.4%. The stock market has seen a recent stumble, with the S&P 500 off 3% from its recent high, but it's still up 1.3% year-to-date. The Nasdaq is off just 1.2% for the year, and the Dow is up 2.1%. The bond market may hold a small clue to the pessimism.
Wall Street Breakfast
Bearish sentiment on stocks soars
The 10-year Treasury yield has dropped from near 4.8% in January to close to 4.3%. Given inflation expectations rising, the drop in rates looks more like pessimism on growth, which could bring a U.S. recession back into the conversation. Looking to today's economic data, January durable goods orders rose after two straight months of decreases of 3.1% and topping the 2% consensus.
Wall Street Breakfast
Walmart gets cautious on the future
Among other active stocks, you heard on Wall Street Breakfast about Palantir's dive in the previous session on potential defense spending cuts, and the stock is sinking again today. Shares are currently down 20% from Tuesday's close.
Wall Street Breakfast
Walmart gets cautious on the future
But Wedbush analyst Dan Ives came to the company's defense, saying, "...the bears, which have hated Palantir from $12 to $120 in the last 18 months, now have found their latest silver bullet negative thesis around Palantir being exposed to these budget cuts."
Wall Street Breakfast
Walmart gets cautious on the future
This is exactly the opposite of how we believe these DoD cuts will play out, as in our view, Palantir's unique software approach will enable the company to gain more IT budget dollars at the Pentagon, not less. And Alibaba is up sharply after topping quarterly consensus numbers. Key takeaways included the beats on revenue, adjusted EBITDA, and cloud intelligence segment sales.
Wall Street Breakfast
Walmart gets cautious on the future
Morgan Stanley said the earnings report strengthened its investment thesis as it made modest upward revisions to its EPS estimates following the print. Meanwhile, Jeffries highlighted that the Alibaba International Digital Commerce Group revenue rose 32% year-over-year to smash expectations.
Wall Street Breakfast
Walmart gets cautious on the future
On the economic front, initial jobless claims rose by 5,000 to 219,000 for the week, a little more than expected. The federal government's campaign to cut costs on fire workers doesn't appear to be affecting D.C. area claims so far. About 20% of federal workers live in the metro area.
Wall Street Breakfast
Walmart gets cautious on the future
Initial claims filed in the District of Columbia arose by 13 to 1695, claims filed in Maryland dropped by 821 to 2354, and claims filed in Virginia declined by 397 to 2805. Samuel Toombs, chief U.S. economist at Pantheon Macro, says any laid-off federal employees likely will file for claims in the coming weeks, particularly if the layoffs broaden out, as seems likely.
Wall Street Breakfast
Walmart gets cautious on the future
Welcome to Seeking Alpha's Wall Street Lunch, our afternoon update on today's market action, news, and analysis. Good afternoon. Today is Thursday, February 20th, and I'm your host, Kim Kahn. Our top story so far. Walmart's future guidance is spooking investors and shares are sharply lower.
Wall Street Breakfast
Walmart gets cautious on the future
While Q4 results topped analysts' expectations, Outlook, quote, assumes a generally stable consumer and continued pressure from its mix of products and formats globally. The expectation for Q1 sales to be up 3% to 4% should result in EPS between $0.57 and $0.58, and That's down 3-4 cents from a year ago and below the consensus estimate of $65.
Wall Street Breakfast
Walmart gets cautious on the future
Next week's numbers will likely also receive an uplift from extreme winter weather in parts of the country. In other news of note, OpenAI had 400 million weekly active users for ChatGPT as of February. That's a 33% increase from the 300 million as of December 4th, 2024. The company had more than 2 million paying business users compared to 1 million as of September 5th.
Wall Street Breakfast
Walmart gets cautious on the future
Apple's integration of OpenAI's AI models started in December last year. Apple Intelligence relies on a mix of Apple's own AI technology and a collaboration with OpenAI. And Amazon MGM Studios is taking over the creative development of the James Bond franchise, with longtime producers Barbara Broccoli and Michael G. Wilson stepping back.
Wall Street Breakfast
Walmart gets cautious on the future
Amazon MGM, Wilson, and Broccoli have formed a new joint venture to house the intellectual property rights of 007. They'll remain co-owners. Financial terms were not disclosed. Amazon gained distribution rights to all the James Bond movies after it bought Metro-Goldwyn-Mayer for $8.5 billion back in 2022.
Wall Street Breakfast
Walmart gets cautious on the future
With the current announcement, the company will also be responsible for creative control and production of future Bond films. Possible upcoming Amazon bond titles already in development? How about Dr. No Returns? From Russia with free shipping, you only click twice, on Her Majesty's Same Day Service and Live and Let Prime.
Wall Street Breakfast
Walmart gets cautious on the future
And in the Wall Street Research Corner, Goldman Sachs chief economist Jan Hansius says changes in AI-related capital expenditures could see just limited near-term implications, despite the deep-seek scares. He says competition could catalyze higher levels of real hardware spending if it pushes incumbents to invest more to maintain their lead.
Wall Street Breakfast
Walmart gets cautious on the future
Goldman Sachs analysts have, in fact, increased their estimate of 2025 AI-related investment on NAT over last quarter. CapEx expectations for 2025 were revised up by 5% for S&P 1500 companies over the last quarter, but were only revised up by 2% for companies with broad exposure to tariffs and revised down by 1% for companies with a high reported share of sales to Canada, Mexico, and China.
Wall Street Breakfast
Walmart gets cautious on the future
That's all for today's Wall Street Lunch. Look for links for stories in the show notes section. Don't forget, these episodes will be up with transcriptions at SeekingAlpha.com. And for a full suite of news, analysis, ratings, and data on stocks and ETFs, go to SeekingAlpha.com.
Wall Street Breakfast
Walmart gets cautious on the future
For full fiscal year 2026, Walmart also expects sales to improve 3-4%, translating to $698.1 billion at the midpoint with EPS between $250 and $260. This is also less than Wall Street's expectations for EPS of $276 on $705.14 billion in sales. Shares did come off their lows, however, during the earnings call, where CEO Doug McMillan said, The sell side also offered support.
Wall Street Breakfast
Walmart gets cautious on the future
Jefferies analyst Corey Tarlow said, Morgan Stanley's Simeon Gutman said, Street estimates are likely to be revised down this morning. Similar to fiscal year 2025, we would expect a path of outperformance in fiscal year 2026 and ultimate EPS power exceeding the initial outlook. Walmart also raised its dividend by 13% to $0.235 per share.
Wall Street Breakfast
Alibaba touts DeepSeek rival
To the extent the surge in imports was a pull forward in demand in preparation for tariffs, we may see some payback in the coming months. Looking to the labor market ahead of Friday's jobs report, Challenger Gray and Christmas said employers announced 173,017 job cuts in February, the highest monthly total since July 2020 and the highest total for February since 2019.
Wall Street Breakfast
Alibaba touts DeepSeek rival
The jump reflects the beginning of federal workforce and spending cuts that the Trump administration is pursuing. The February tally is more than triple the 49,795 cuts announced in January and more than double the 84,638 job eliminations announced the same month last year. But weekly initial jobless claims fell more than expected to 221,000.
Wall Street Breakfast
Alibaba touts DeepSeek rival
Chinese companies are continuing to make big strides in artificial intelligence, as Alibaba unveiled its latest reasoning model with fewer parameters, which rivals DeepSeek's R1 and OpenAI's O1 Mini. The new model, called QWQ32B, was developed with 32 billion parameters, referring to the training data that enables the model to generate desired outputs.
Wall Street Breakfast
Alibaba touts DeepSeek rival
Pantheon macroeconomist Samuel Toombs says, Data for claims made by former federal workers are reported separately and with a one-week lag. Unadjusted claims by former federal workers increased to 1,600 in the week ended February 22, up from 600 in the previous week. They likely rose further last week, given the faster pace of Doge job-cutting in recent weeks.
Wall Street Breakfast
Alibaba touts DeepSeek rival
Among active stocks, Marvell Technologies plunging as traders deemed its results, which looked okay at first blush, not good enough. KeyBank Capital Markets analyst John Vinn said the results and guidance were solid, but the company's data center revenue was only in line with estimates.
Wall Street Breakfast
Alibaba touts DeepSeek rival
Welcome to Seeking Alpha's Wall Street Lunch, our afternoon update on today's market action, news, and analysis. Good afternoon. Today is Thursday, March 6th, and I'm your host, Kim Kahn. Our top story so far.
Wall Street Breakfast
Alibaba touts DeepSeek rival
Additionally, there may be some concern from investors related to its Amazon businesses, as Amazon's Tranium 3 chip is likely to be developed by Amazon's own Annapurna Labs. Marvell won Amazon's next-gen Tranium 2.5 Ultra.
Wall Street Breakfast
Alibaba touts DeepSeek rival
Going a step further, Summit Insights Group analyst King Chai Chan downgraded Marvell to Hold, noting that investor expectations are too high and the company lacks the financial leverage as its application-specific integrated circuit AI business could pressure the company further.
Wall Street Breakfast
Alibaba touts DeepSeek rival
Hims and Hers is down after a court denied a motion filed by two compounding trade groups over the FDA's decision to declare that Eli Lilly's weight loss drug Zepbound is no longer in shortage. Hims and Hers markets compounded versions of rival Novo Nordisk's weight loss therapy Semaglutide at a sharp discount to the branded versions.
Wall Street Breakfast
Alibaba touts DeepSeek rival
And MongoDB is sinking after the database solutions company provided a much weaker-than-expected outlook for fiscal year 2026. The reason for the lower outlook centers around slower growth from MongoDB's non-Atlas revenue. Atlas, which is a fully managed cloud database, accounted for 71% of revenue for the company during the fourth quarter of fiscal 2025.
Wall Street Breakfast
Alibaba touts DeepSeek rival
Piper Sandler analyst Brent Braceland said, The initial growth outlook of 12.6% year-on-year versus our prior estimate of 17% shakes our confidence in the durability of share gains and upside levers in the near term. In other news of note, no booze is worse than expensive booze, at least according to Brown Foreman, CEO Lawson Whiting.
Wall Street Breakfast
Alibaba touts DeepSeek rival
Brown Foreman, owner of Jack Daniels, Woodford Reserve, and Herradura, among other brands, held its earnings call and Whiting criticized Ontario's removal of U.S. alcohol products, calling it a disproportionate response to President Donald Trump's tariffs on Canada and Mexico.
Wall Street Breakfast
Alibaba touts DeepSeek rival
He said, "...I mean, that's worse than a tariff because it's literally taking your sales away and completely removing our products from the shelves." But he added that Canada is not a massive market for brown foreman, and it's around 1% of sales, so we can withstand.
Wall Street Breakfast
Alibaba touts DeepSeek rival
We're going to continue to try and fight for getting reciprocal zero-for-zero tariffs, which is the best thing for our industry as a whole, he said. And in the Wall Street Research Corner, BTIG technical strategist Jonathan Krinsky says the S&P 500 is facing more W-shaped recoveries rather than a V-shaped bounce-back.
Wall Street Breakfast
Alibaba touts DeepSeek rival
Krinsky said, with the S&P 500 index within spitting distance of its 200-day moving average, we have been receiving an increasing amount of questions as to whether we are near a bottom. Anecdotally, we get the sense that complacency has been removed, but we are not yet at any sort of fear.
Wall Street Breakfast
Alibaba touts DeepSeek rival
He said that investors have become accustomed to V-shaped recoveries, but there is the possibility this recovery will be more of a W-shaped bottom with a bounce and a retest later this month.
Wall Street Breakfast
Alibaba touts DeepSeek rival
In addition, he said that although surveys such as the AAII Sentiment Survey have shown extreme pessimism among investors, little attention was paid to the other question that is asked in the survey, stock allocation. As of the end of February, stock allocation dipped just slightly to 67.9% from 69.1%.
Wall Street Breakfast
Alibaba touts DeepSeek rival
Alibaba claims QWQ32B can achieve performance comparable to DCEC's R1 model, which uses 671 billion parameters. Alibaba's Quen team evaluated the new model across a range of benchmarks to assess its mathematical reasoning, coding, and general problem solving. It more or less matched the performance of R1 and OpenAI's cost-efficient O1 mini model.
Wall Street Breakfast
Alibaba touts DeepSeek rival
During the 2022 lows, stock allocation was 62%, during the COVID-19 lockdown it bottomed to 55%, and during the financial crisis it fell to 40%. That's all for today's Wall Street Lunch. Look for links for stories in the show notes section. Don't forget, these episodes will be up with transcriptions at seekingalpha.com.
Wall Street Breakfast
Alibaba touts DeepSeek rival
And make sure you're getting the most out of your portfolio with quant, news, and analysis by heading to seekingalpha.com.
Wall Street Breakfast
Alibaba touts DeepSeek rival
The release comes as Alibaba committed to invest over $52 billion in its cloud computing and AI infrastructure over the next three years. On the economic front, the U.S. trade deficit surged 34% to a record $131.4 billion in January, higher than the $123 billion shortfall expected and up from $98.1 billion in December as fear of tariffs caused a spike in imports.
Wall Street Breakfast
Alibaba touts DeepSeek rival
January imports rose 10% to $401.2 billion. Wells Fargo economists say, We ultimately expect tariffs to impart a modest stagflationary impulse of slower growth and higher inflation on the U.S. economy. The degree of the shock depends on many factors, such as exclusions and how long tariffs are in place. Today's release highlights that the sheer threat of tariffs has already influenced behavior.
Wall Street Breakfast
Last CPI before tariffs impact
Glenn Smith, CIO at GDS Wealth Management, says Friday's jobs report is concerning because this report doesn't account for the recent government job cuts from Doge, so it suggests that businesses are taking a pause on hiring until there is more certainty about tariff policy and the economic outlook.
Wall Street Breakfast
Last CPI before tariffs impact
Investors are starting to worry about a noticeable deceleration in first quarter GDP, which is set to be released at the end of April, and that is contributing to the past few weeks of stock market volatility. On the earnings front, Adobe will report on Wednesday the software company is expected to post EPS of $4.97 on revenue of $5.66 billion.
Wall Street Breakfast
Last CPI before tariffs impact
Piper Sandler said in a note earlier this week that 10% to 11% of annual growth in subscription may be partially masked by a year-on-year decline of 15% in Adobe's legacy product and service revenue. It expects margin expansion and stock repurchases to insulate EPS growth that should continue to grow double digits.
Wall Street Breakfast
Last CPI before tariffs impact
Adobe has a number of new AI products that could bolster growth into the next year, including Express, Acrobat AI Assistant, Firefly, DX Premium Tiers, and Gen Studio. Essay analyst DM Insights called Adobe a compelling buy on Friday. Adobe has a very reliable and predictable subscription-based business model, they said.
Wall Street Breakfast
Last CPI before tariffs impact
The company faces increased competition from other large businesses and AI productivity tools. However, Adobe's business model will remain unchallenged, at least in the near future. Their software offering and seamless integration is a huge asset, making transitioning to a different software suite very inconvenient. Adobe's valuation is very reasonable at this point.
Wall Street Breakfast
Last CPI before tariffs impact
Also on the earnings calendar, BeyondTech, Vale Resorts, and NetPower report on Monday. On Tuesday, Ferguson Enterprises, Viking Holdings, Dick's Sporting Goods, Sienna, and Kohl's weigh in. Joining Adobe on Wednesday are Crown Castle, UiPath, SentinelOne, and ABM Industries. Ulta Beauty, DocuSign, Dollar General, Futu Holdings, and Rubrik are due on Thursday. Lee Otto reports Friday.
Wall Street Breakfast
Last CPI before tariffs impact
In the news this weekend, the Department of Justice reaffirmed its demand that a federal court break up Google. The DOJ's request came after Judge Amit P. Mehta of the U.S. District Court for the District of Columbia ruled last year that Alphabet illegally operated a monopoly in online search through payments to web browsers and smartphone makers to feature Google search engines.
Wall Street Breakfast
Last CPI before tariffs impact
Google's illegal conduct has created an economic goliath, one that wreaks havoc over the marketplace to ensure that, no matter what occurs, Google always wins, the government said in its filing. The American people thus are forced to accept the unbridled demands and shifting ideological preferences of an economic leviathan in return for a search engine the public may enjoy.
Wall Street Breakfast
Last CPI before tariffs impact
In their weekly equities rundown, Goldman Sachs lists a host of things traders are fretting about, including said growth worries, tariff fatigue, weak technicals, challenging liquidity, consumer woes, and poor seasonality. If Wednesday's consumer price index again indicates sticky inflation, it could trigger a further leg down for stocks.
Wall Street Breakfast
Last CPI before tariffs impact
However, the DOJ dropped its request that Google be forced to sell off its stakes in AI companies, including Anthropic, to promote online search competition. DOJ's sweeping proposals continue to go miles beyond the court's decision and would harm America's consumers, economy, and national security, Google told Seeking Alpha.
Wall Street Breakfast
Last CPI before tariffs impact
And Meta Platforms is working to advance the voice-controlled capabilities of its new open-source large language model, Lama 4, as it expects conversational AI agents will supplant text-driven agents. The Financial Times says Lama 4 is expected to be released in the next few weeks. The Ray-Ban Metas are already utilizing this type of technology.
Wall Street Breakfast
Last CPI before tariffs impact
Chief Product Officer Chris Cox said, So what we have now, we believe, is the best AI device on the market, which is the Ray-Ban Meta. They allow you to talk to them. You can ask questions about the world in front of you. For income investors, Allstate goes ex-dividend on Monday with a payout date of April 1st. HP and Nvidia go ex-dividend on Wednesday.
Wall Street Breakfast
Last CPI before tariffs impact
HP pays out on March 12th, and Nvidia pays out on April 2nd. Home Depot goes ex-dividend on Thursday and pays out on March 13th. And in the Wall Street Research corner, Piper Sandler is out with actionable stock recommendations amid a bearish tilt to the market over concerns of economic growth, tariffs, and other policies.
Wall Street Breakfast
Last CPI before tariffs impact
Craig Johnson, chief market technician, noted that his proprietary breadth indicators are in sell positions. Our MACE trend work reveals that more stocks are in downtrends than uptrends, he said. But added he suspects markets will find some footing as the S&P 500 tests its 200-day moving average and the Russell 2000 tests its 50% retracement from its October 2022 low.
Wall Street Breakfast
Last CPI before tariffs impact
A period of stabilization, reassessment, and rotation is likely at current levels, he said. Among the actionable picks are JD.com, approaching the top of a bullish cup-and-handle formation, add to positions on a breakout above resistance near $48. And Warner Bros.
Wall Street Breakfast
Last CPI before tariffs impact
Discovery, approaching the neck of an inverted head-and-shoulders formation, add to positions on a breakout above the neckline near $12.70. That's all for today's Wall Street Brunch. Look for links to stories in the show notes section. Don't forget, these episodes will be up with transcriptions at SeekingAlpha.com. And join the elite community of real investors to unearth great investing ideas.
Wall Street Breakfast
Last CPI before tariffs impact
Economists expect that the headline CPI and the core CPI rose by 0.3% in February. That would bring the annual rate down to 2.9%, with the core rate edging down to 3.2%. Wells Fargo economists say, while February's CPI report is likely to deliver an initial taste of tariffs, it is likely to be just the start.
Wall Street Breakfast
Last CPI before tariffs impact
Welcome to Seeking Alpha's Wall Street Brunch, our Sunday look ahead to this week's market-moving events, along with the weekend's top news and analysis. Hello, today is Sunday, March 9th, and I'm your host, Kim Kahn. Investors turned their attention to inflation once again this week, but now with a backdrop of uncertainty over government policy and real concern about growth.
Wall Street Breakfast
Last CPI before tariffs impact
The implementation of a further 10% tariffs on Chinese goods and the follow-through on 25% tariffs on goods from Canada and Mexico, even with some carve-outs, is poised to stoke inflation in the near term.
Wall Street Breakfast
Last CPI before tariffs impact
Although we expect both headline and core inflation to take down on a year-over-year basis in February, we anticipate it will start moving back up this spring and remain stuck near 3% for the duration of this year despite further easing in shelter inflation and growing signs of consumer fatigue.
Wall Street Breakfast
Last CPI before tariffs impact
If the CPI delivers a dovish surprise, that could cement market expectations for a Fed rate cut in June. The odds of the Fed cutting by a quarter point that month jumped to 80% after the weaker-than-expected rise in February payrolls, and Fed funds' futures are pricing in a 1-in-4 chance now that rates could be down by 50 basis points from the current range in June.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
Unsurprisingly, the result has been a generalized and quite indiscriminate hit to asset prices from stocks to gold, with most correlations converging to one for now.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
While this has created pockets of value for investors able and willing to stomach significant price volatility, the when is a much harder call given the extent of potential deleveraging still in the pipeline, especially if the direction of travel on tariffs worldwide remains retaliatory rather than de-escalating. The big question is whether traders can move past the macro and focus on the micro.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
As earnings season kicks off, bulls will hope good numbers and guidance, especially on margins, can underscore the health of corporate America. But bears will be listening to earnings calls for color on how tariffs and uncertainty are expected to impact operations and whether price hikes will be passed on to consumers. Earnings kick into high gear on Friday with the banks.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
JPMorgan Chase, Wells Fargo, Morgan Stanley, and BNY Mellon all issue numbers before the bell. But investors may get a better insight on spending from Delta Airlines, which reports Wednesday. Airlines have already started seeing the effects of souring consumer sentiment, and the Jets ETF is well into bear market territory, down 32% from its high in late January.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
This past week, Jefferies cut Delta to hold from buy, warning of depressed corporate spending. Delta lowered its top-line guidance on March 11th, and analysts now expect it to report $13.66 billion in revenue for its fiscal first quarter. On the bottom line, EPS of 44 cents is expected, with 10 analysts lowering estimates over the past three months and no analysts raising them.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
Shares are off nearly 40% year-to-date. Also on the earnings calendar, Levi Strauss and Dave & Buster's report on Monday, Tilray Brands and RPM International issue numbers on Tuesday, Constellation Brands joins Delta on Wednesday, CarMax reports Thursday. On the economic front, it's all about inflation. The March CPI is due on Thursday.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
Following President Donald Trump's announcements of new tariffs, a risk off Thursday and Friday saw the biggest two-day round in years. The S&P 500 slumped 10.53% over Thursday and Friday, leaving it at 5,074.08 points. That level marks a 17.42% retreat from the index's most recent record close. This was the biggest two-day decrease since the S&P slid 13.93% across March 11th and 12th, 2020.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
The headline is expected to have risen 0.1% on the month, which would bring the annual rate down to 2.6%. The core CPI is forecast to have risen 0.3%, with the annual rate dipping to 3%. Wells Fargo economists say the abrupt change in U.S.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
trade policy this week will make the March CPI feel like old news, and the details are likely to prove less encouraging than the headline as the drag from energy goods was fanned by growth concerns. Core goods inflation was already on the upswing, and services disinflation remains frustratingly slow.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
Some household food staples, including egg prices, retreated over the month, but any reprieve from overall food-at-home inflation was likely more than offset by gains in other grocery categories. Even as we forecast headline CPI to come in flat month-over-month in March, the looming effects of higher tariffs look to throw a wrench into the fight against inflation.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
Meanwhile, the Goldman Sachs economics team says its rule of thumb is that every one percentage point increase in the effective tariff rate raises core PCE prices by about 0.1 percentage point. They say tariffs announced here today would raise the U.S.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
effective tariff rate by 18.8 percentage points, which would put the annual core PCE price index on track to jump to nearly 4.7% from the 2.8% print in February. In the news this weekend, Pershing Square Capital's Bill Ackman issued a stark warning about the economic fallout of impending tariffs, urging Trump to delay their implementation to avert a potential recession.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
Ackman suggested that Trump's recent tariff threats, while effective in drawing attention to longstanding trade imbalances, may come at the cost of economic stability if enacted too swiftly. One would have to imagine that President Trump's phone has been ringing off the hook, Ackman said.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
The practical reality is that there is insufficient time for him to make deals before the tariffs are scheduled to take effect. And the legal pushback is already underway on tariffs. The Wall Street Journal says that although Congress traditionally holds the power to regulate trade and impose tariffs, it has gradually delegated some of that authority to the executive branch through various laws.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
Trump is now relying on the International Emergency Economic Powers Act, a 1977 statute typically used for sanctions and asset freezes, to justify the tariff hike. He's the first president to use it for imposing broad-based import taxes. Critics argue that the emergencies cited by Trump are not the kind of, quote, unusual and extraordinary threats, unquote, the law was meant to address.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
Legal experts also warn that the IEEPA in this way could open the door to unchecked presidential control of a trade policy. One of the first legal challenges came this week from Simplified, a small Florida-based company that imports materials from China. It claims the tariffs are unrelated to a legitimate emergency and violate federal law.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
For income investors, McCormick and Quest Diagnostics go ex-dividend on Monday, both paying out on April 21st. Dollar General goes ex-dividend on Tuesday with an April 22nd payout date. Interestingly, Dollar General is the best performing stock in the Russell 1000 since Trump took office for his second term.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
MasterCard and the Gap go ex-dividend on Wednesday, Gap pays out on April 30th, and MasterCard pays out on May 9th. Oracle, Salesforce, and heavy hitter AT&T go ex-dividend on Thursday. Oracle pays out on April 23rd, Salesforce pays out on April 24th, and AT&T pays out on May 1st.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
And in the Wall Street Research Corner, PIMCO co-founder Bill Gross said investors should stay away from buying the dip. The investor and retired fund manager said in an email that investors should try not to catch a falling knife. This is an epic economic and market event similar to 1971 and the end of the gold standard, except with immediate negative consequences, he said.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
Gross said this tariff-related sell-off was a deep market event that has little resolution in sight. He adds that Trump can't back down anytime soon. He's too macho for that. He also said he sees opportunities only in domestic stocks that could provide relatively safe dividends as interest rates fall.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
He named AT&T and Verizon Communications, but even with these, be careful, they are approaching overbought territory. That's all for today's Wall Street Brunch. Look for links to stories in the show notes section. Don't forget, these episodes will be up with transcriptions at SeekingAlpha.com slash WSB. and join the elite community of real investors to unearth great investing ideas.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
That crash came during the height of the COVID-19 pandemic and lockdowns across the globe. Going further back to 2008, the S&P notched a 12.42% fall across November 19th and 20th, 2008 in the wake of the collapse of Lehman Brothers. The FT says hedge funds are experiencing their most significant margin calls since the onset of COVID-19.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
Welcome to Seeking Alpha's Wall Street Brunch, our Sunday look ahead to this week's market moving events, along with the weekend's top news and analysis. Hello, today is Sunday, April 6th, and I'm your host, Kim Kahn. Investors can be forgiven for looking at this week with trepidation.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
Major Wall Street banks have demanded additional collateral from hedge fund clients whose portfolios suffered sharp declines in value. Several large institutions have issued their largest margin calls in over four years, reflecting the scale of the market dislocation.
Wall Street Breakfast
Earnings season kicks off with market in grips of tariff trauma
Allianz advisor Mohamed El-Arian says the last few trading sessions were characterized by a significant reduction in levered exposures and index holdings, as well as the sale of winners to fund margin calls and actual anticipated outflows from funds. The lack of immediate policy circuit breakers have amplified the adverse technical dynamics, he said.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
The 10-year yield is up more than 10 basis points, back above 4.1%. It touched below 3.9% on Friday. Renaissance Macro said the move could be related to people dumping their bonds to raise cash, which is, quote, not good. Another possibility is sovereign selling, which would also be worrying. What's unlikely is that it's a sudden renewed faith in growth.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
Goldman Sachs lowered its 2025 fourth quarter over fourth quarter GDP growth forecast to 0.5% down from 1%. It also lowered its annual average GDP growth forecast from 1.5% to 1.3% and raised its 12-month recession probability to 45% up from 35%.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
Chief Economist Jan Hatsias cites a sharp tightening in financial conditions, foreign consumer boycotts, and a continued spike in policy uncertainty that is likely to depress capital spending by more than we had previously assumed. In his letter to shareholders, JPMorgan Chase CEO Jamie Dimon warned that the latest round of tariffs is likely to drive up inflation and dampen economic growth.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
There also remains a growing need for increased expenditures on infrastructure, the restructuring of global supply chains and the military, which may lead to stickier inflation and ultimately higher rates than markets currently expect, Diamond said.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
The economy is facing considerable turbulence, including geopolitics, with the potential positives of tax reform and deregulation, and the potential negatives of tariffs and trade wars, ongoing sticky inflation, high fiscal deficits, and still rather high asset prices and volatility, he added.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
Welcome to Seeking Alpha's Wall Street Lunch, our afternoon update on today's market action, news, and analysis. Good afternoon. Today is Monday, April 7th, and I'm your host, Kim Kahn. Our top story so far. The stock market has gone from edgy to jumpy to nervous as a long-tailed cat in a room full of rocking chairs, if you'll forgive the technical terms.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
Among active stocks today, Bernstein said tariffs could eliminate 20% in free cash flow and shave 50% in full-year 2026 adjusted EPS for General Motors. Analyst Daniel Roeske downgraded the stock to underperform for market perform and lowered its price target to $35 from $50. He said, For the past six months, we've been cautious as U.S. policy uncertainties started to mount.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
Now, with greater clarity, the outlook for GM is clearly unfavorable. Our revised numbers reflect the impact of tariffs, softening consumer sentiment, and the realization that GM's peak in the cycle may be behind it. Strategy, formerly MicroStrategy, recognized a $5.91 billion unrealized loss on its digital assets for Q1 2025, which is expected to result in a net loss for the quarter.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
Volatility and swings are the order of the day, and investors look unsure which way to turn as the major averages bounce around. Case in point, one erroneous tariff headline pushed the Nasdaq composite, which had been down more than 4% at its intraday lows, to more than 4% in the green. Cheney strategist Guy Lebas noted the S&P 500 was tracing a 780-point intraday path. Those are just wild moves.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
The company has amassed holdings of Bitcoin on its balance sheet. We may not be able to regain profitability in future periods, particularly if we incur significant unrealized losses related to our digital assets, the company said in a filing. As a result, our results of operations and financial condition may be materially adversely affected. And U.S.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
Steel is rallying after Trump ordered a national security review of its planned sale to Nippon Steel. The Committee on Foreign Investment review comes after former President Joe Biden originally blocked the deal. The new review may allow the White House administration to potentially approve the deal.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
In other news of note, Mesa Air Group struck an all-stock deal to merge with Republic Airways to create a leading publicly traded regional airline. Upon closing, the combined company will be renamed Republic Airways Holdings and is expected to remain NASDAQ-listed under the new ticker RJET. Terms of the deal were not disclosed.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
Republic shareholders would own 88% of the combined company, while Mesa shareholders would own a minimum of 6%, up to 12%. Mesa CEO Jonathan Ornstein said, Today's announcement is an exciting next step in Mesa's more than 40-year history, one that represents the best outcome for our shareholders, employees, and all of our stakeholders.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
The proposed combination creates a carrier with a larger unified fleet. The combined company is expected to produce revenues of approximately $1.9 billion, pre-tax margins of 7-9%, excluding one-time merger integration costs, and adjusted EBITDA exceeding $320 million. That's all for today's Wall Street Lunch. Look for links for stories in the show notes section.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
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Wall Street Breakfast
Bears and bulls battle it out in wild trading
The headline that President Trump was considering a 90-day pause on tariffs on all countries except for China came from a known financial Twitter account, which said its source was Reuters. CNBC reported the headline, but later said it was unconfirmed, and the White House finally denied the headline, calling it fake news.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
Instead, Trump later indicated that he was ready to heap an additional 50% tariff onto Chinese goods entering the U.S. as of Tuesday in response to China's 34% retaliatory tariffs on U.S. goods. That would bring the tariff rate on Chinese goods to more than 100%. The major averages are now down between 1 and 2%, but the swings haven't stopped, and a higher finish wouldn't be out of the question.
Wall Street Breakfast
Bears and bulls battle it out in wild trading
The VIX volatility index, also known as the fear gauge, topped 60 overnight, and it's currently near 50. That's a level that can prompt short-term buying. The CNN fear and greed index is at a lowly 4 on a scale of 0 to 100, indicating fear in the extreme. Also potentially supporting stocks is some unexpected action in the bond market, where treasury yields have been moving higher.