Macro Events & News
The markets saw a boost this week, driven by continued solid earnings & guidance by megacap names, commentary from the Federal Reserve Chair, and PCE data. Concerns over China’s AI dominance also eased after further analysis suggested DeepSeek may have overstated its cost advantages.
However, sentiment shifted on Thursday as the Trump administration reignited tariff discussions, fueling concerns over a resurgence in inflationary pressures. While December PCE data met expectations at 0.3% headline and 0.2% core, initially sparking a rally, optimism quickly faded after the administration announced tariffs on Canada, Mexico, and China set to take effect on Saturday. The lack of clarity on whether these tariffs would be broad-based or phased in by industry further intensified fears of rising costs, renewed inflation risks, and potential rate hikes.
The 10-Year Treasury yield dipped slightly to 4.51%. The VIX spiked in response to the tariff news on Friday.
All major indexes ended flat or lower: the Dow up <1%, the S&P 500 down 1%, and the Nasdaq down 1.6%.
Watchlist News
6% ▲
Accenture (NYSE:ACN) no big headlines besides Morgan Stanley raising the price target to $380 while maintaining a Equal-Weight rating. The strong performance and outlook from IBM who reported this week may have helped boost the name as it signals encouraging growth in the industry.
august bear notes
No real catalyst here, more of a technical breakout that may continue as earnings are not until March and they broke through resistance levels. Some may attribute it to positive IBM earnings but they are direct competitors so usually inversely correlated. They may be a bit more insulated by the incoming trade war as they are a proprietor of human capital rather than physical goods. But should there be an escalation, they could get more directly impacted.
5% ▼
AMD (NASDAQ:AMD) was gaining momentum throughout the week, approaching the $120 mark, before tariff news triggered a pullback. Additionally, rumors of new chip embargoes in response to DeepSeek’s reported use of older, less powerful chips added further downward pressure.
august bear notes
AMD cannot seem to catch a break as it heads into its Q4 earnings report on February 4. While low sentiment and expectations could work in its favor, the downside risk remains significant if results miss the mark—particularly in Data Center or Client.
Data Center has been the key growth driver, while Client has served as AMD’s workhorse, but the long-awaited PC refresh cycle cannot be explained away as delayed again without raising serious concerns.
1% ▼
Netflix (NASDAQ:NFLX) benefited from upgrades and price target hikes from firms like Wolfe, Bernstein, and Daiwa Securities, fueling strong price action throughout the week. However, despite the momentum, broader market negativity from tariff concerns weighed on sentiment, limiting further gains.
august bear notes
As noted, there is a solid base here and regardless of what happens on the macroeconomic level, Netflix should be resilient as their earnings and increase in subscription prices demonstrates unprecedented pricing power. That does not mean they will climb higher right away but does suggest that downside is limited.
1% ▲
Workday (NASDAQ:WDAY) continued its rebound from last week, briefly approaching $275 early in the week. However, momentum faded in the latter half, though the stock still managed to end the week in positive territory.
august bear notes
With little fundamental news, Workday’s recent move appears to be more of a technical recovery. Given its primarily U.S.-based client base, the company is less exposed to potential retaliatory tariffs, making it relatively insulated from global trade tensions. While there is room for further upside, its trajectory will likely depend on broader market sentiment.
