U.S. stocks slipped on Thursday as the market pulled back from record highs, with major indices like the S&P 500, Dow Jones, and Nasdaq Composite all declining. Technology stocks, which had surged the previous day, were mostly lower, with notable declines in Nvidia, Alphabet, and Amazon. Adobe shares fell sharply due to a weak revenue outlook, while Warner Bros. Discovery shares rose on restructuring news. Economic data showed higher-than-expected wholesale inflation and disappointing jobless claims, but did not alter expectations of a Federal Reserve rate cut next week. Meanwhile, Donald Trump made a historic visit to the NYSE, promoting tax cuts and investment in AI.
The S&P 500 and Nasdaq Composite reached new record highs, while Bitcoin maintained its position above $100,000, driven by optimism over pro-growth policies expected from the incoming Trump administration. Large-cap tech stocks like Tesla and Nvidia saw gains, while Synopsys and Fiserv faced declines due to disappointing forecasts and executive appointments, respectively. Investors are closely watching the upcoming jobs report and Federal Reserve's rate decisions. Meanwhile, American Airlines and Five Below stocks surged on new partnerships and leadership changes.
The S&P 500 and Nasdaq Composite reached record highs, driven by gains in technology stocks, while the Dow Jones dipped slightly. Tesla shares rose 4% following optimistic analyst reports, and Super Micro Computer's stock surged nearly 30% after an investigation found no financial misconduct. Meanwhile, MicroStrategy purchased more Bitcoin, and Stellantis shares fell 7% after CEO Carlos Tavares resigned. Investors are eyeing upcoming economic data, particularly the November jobs report, for insights into potential Federal Reserve interest rate decisions.
Jeffries has downgraded Palantir Technologies (PLTR) to "Underperform" and cut its price target to $13, citing an unsustainable valuation propelled by AI excitement that is outpacing the reality of revenue generation. Senior Analyst Brent Thill suggests that while AI will be a significant driver for the tech industry, its impact on revenue will materialize slower than the market anticipates. Thill recommends investors to focus on companies with broader product offerings, like Microsoft and Adobe, and to consider returning to AI-centric stocks like Palantir once the hype has subsided and valuations become more reasonable.
The article suggests three technology and semiconductor stocks to consider for investment in 2024, focusing on their growth potential driven by advancements in artificial intelligence (AI). Advanced Micro Devices (AMD) is highlighted for its strong performance and new AI-focused microchips. Cadence Design Systems (CDNS) is noted for its integral role in microchip design and robust financials. Micron Technology (MU) is recognized for its recent positive earnings and strategic positioning in memory chips for AI applications. These stocks are recommended for a $100,000 portfolio, with the tech sector continuing to offer promising opportunities for growth-oriented investors.
Wall Street is experiencing a shaky start to its second day of 2024, with technology stocks leading a drop in stock index futures. Steve Eisman, known for his role in predicting the 2008 financial crisis, expressed concern about the overly optimistic sentiment entering the new year, despite technology being a favored sector among some investors and Wall Street banks. This sentiment comes amidst expectations of a downturn, or "trough of disillusionment," particularly for stocks related to General AI (GenAI).
