US Tech in 5: Your No-Nonsense Morning Briefing

the nasdaq just got hammered dropping 1.25% on thursday and it was all about a sell off in ai stocks yesterday we talked about the market shocks that actually drive tech well today the market just delivered a big one wiping out gains and raising some serious questions so here's the quick sweep of what else you need to know first it wasn't just the nasdaq semiconductor stocks got crushed the main semiconductor etf the soxx fell over 3% a benchmark for memory chips dram plunged more than 5% that's not a dip that's a dive but while tech was bleeding some names bucked the trend palantir jumped 3% why goldman sachs just upgraded the stock to a buy slapping a $230 price target on it so even as the sector sold off wall street is still placing bets on specific ai players and just a quick reminder for you this is general information and our opinion not financial advice always do your own research elsewhere jeff bezos just announced that blue origin is planning an ipo in the coming

years this comes after the company raised $10,000,000,000 from outside investors so the space race isn't just about rockets anymore it's about to become a full blown wall street drama on the jobs front amazon confirmed it's cutting under a thousand rolls mostly in retail it's a much smaller cut than last year but it shows the pressure is still on and speaking of pressure pepsico is also hinting at layoffs as part of its own cost cutting and then there were the national security headlines you can't ignore first crowdstrike just identified ai assisted cyber attacks targeting banks in south korea the likely culprit a financially motivated group based in china this is the new frontier of cybercrime folks and second this one is a mess the pentagon is investigating how ups mistakenly routed sensitive f 35 fighter jet parts through hong kong a major violation of arms export rules the parts were supposedly unserviceable but they contained radar absorbing coatings that's stealth technology potentially exposed why does that matter because rapid moves like this are historically a huge

red flag strategist at macquarie just put out a note saying and i'm quoting here almost all of the high profile financial blowouts over the past five decades have occurred in the immediate aftermath of rapid moves in bond yields they're basically flashing a giant warning sign that when the bond market gets this volatile something somewhere is about to break and what's the first thing to get hit when borrowing costs skyrocket high growth tech stocks the very same ai names that have been flying high all year their future profits are suddenly worth less today when interest rates are this high so you see the connection the ai sell off isn't happening in a vacuum it's a direct response to a major stress signal coming from the core of the financial market so what's the takeaway here is the ai boom over no not even close look at that palantir upgrade look at the money still pouring into the space but the era of easy money that fueled the initial frenzy that is definitively over and this creates

a fascinating split in the market shay belour a strategist at futurum equities put it perfectly he said the winner of the ai model race keeps looking like whoever owns the distribution tollbooth think about that the real durable winners might not be the companies building the flashiest new model the winners will be the platforms the ones who control access and distribution he names amazon google microsoft meta and palantir they are the tollbooth operators of the ai economy they own the pipes and in a market that's suddenly scared of risk and focused on fundamentals owning the pipes is the safest and smartest bet there is that's the shift we just saw happen the hype is meeting reality and the money is flowing from speculation to infrastructure