Chips Are Hot

CLOSING BELL

Chips Are Hot

The market climbed Tuesday, the biggest names getting even bigger, smashing record market caps on deals, deals, deals. The S&P 500 broke 6,900. 

Nvidia climbed to $4.65T, Apple and Microsoft crossed the $4T mark, with earnings today pushing stocks higher, and three Mag 7 names reporting Wednesday, five names and more than a quarter of the S&P’s value reporting this week. Tomorrow also brings the FOMC rate decision. We’ll go over why markets are betting on a cut despite gov-shutdown blinders over decision-making. 

President Trump was in Japan, praising diplomats and shaking hands, on track to hopefully do the same to win back some rare-earth exports from China later this week. 

Today’s RIP: Nvidia, Microsoft rip to records on AI deals, Fed’s cutting blindfolded, Reports after the bell, and more. 

3 of 11 sectors closed green. Tech $XLK ( ▲ 0.99% ) lead and real estate $XLRE ( ▼ 2.22% ) lagged.

 $SPY ( ▲ 0.27% )  $QQQ ( ▲ 0.77% )  $IWM ( ▼ 0.54% )  $DIA ( ▲ 0.38% ) 

INDUSTRY NEWS 

Nvidia Reaching Towards $5T With Deals 

Nvidia CEO Jensen Huang delivers a keynote at GTC 

As if to one-up Qualcomm’s AI chip plans, Nvidia flew to record highs Tuesday during the industry leader’s annual GPU Tech Conference event. CEO Jensen Huang said things were heating up in the AI world, that “AI models are now smart enough they’re worthy to pay for,” Huang said.

Huang said that its top-of-the-line Blackwell AI chip wafers were now under construction right here in the U.S., in Phoenix, Arizona.

The industry needs to drive computing costs down dramatically to keep moving, he said, an all-consuming energy marathon market that’s on track to break $500B by the end of the decade, according to estimates from Furutrum.

Not to end the day empty-handed, Nvidia said it was partnering with Uber and Lucid to build autonomous cars. $UBER ( ▼ 1.03% ) fell despite plans for 100,000 level 4 self-driving cars driving off the lot by 2027 using Nvidia’s Drive ACX ‘Hyperion 10’ platform. 

Level 4 means the car is officially driving itself in geo-mapped areas, like Waymo taxis, and unlike Tesla cars that still need drivers. On top of that $NOK ( ▲ 22.84% )stock soared after Nvidia announced a 166M share stake purchase. Nvidia said it needed telecom equipment to work on its 5G and 6G(?) connectivity solutions. It was the biggest one-day gain for the one-time brick-like phone maker in a decade. 

Not to be left out of the AI deal pile, Microsoft rose $MSFT ( ▲ 1.99% ) after renewing its stake in OpenAI, this time for 27% of the for-profit section of the private company, valued at around $130B. 

OpenAI agreed to buy $250B worth of Microsoft Azure cloud services, and Microsoft has the rights to use OpenAI models through 2032, even if OpenAI creates AGI. 

AGI is basically a human-level intelligent computer, a milestone that many theorize will either launch humanity to unimaginable heights or send us all to extinction. 

Apple was also reaching past $4T, $AAPL ( ▲ 0.07% ) on iPhone 17 sales. Way less exciting, I know. 

MACRO NEWS

FOMC Is Going To Cut, But They Don’t Know Why 

Click this and vote! 

The FOMC began its two-day meeting on Tuesday, priced in by betters and futures traders a 99% probability of a 25 basis point rate cut to a new target 3.75-4.00 Federal Funds Rate. 

Wall Street Journal Economist Nick Timiraos said the Fed is basically flying blind without government data drops. He said he was watching for anything forward-looking from the Fed or Chair Jerome Powell, especially about the last rate decision this year in December. 

“At the Fed’s last meeting, there was a split,” he said, between officials worried about the labor market that wanted to keep cutting, and those who didn’t think more cuts were needed. “Since then, there hasn’t been a lot of data to recognize that debate,” Timiraos said. 

We did get CPI data, a little delayed last week, showing inflation climbed 3%, but not as much as in the past, especially looking at the month-over-month increase of 0.3%. a ton. Still far above 2% though, and if the prices stay stuck around +3%, cumulative numbers have inflation since 2020 up 25%. 

Schwab analyst Kathy Jones said a rate cut is a “sure thing,” but warned that policymakers are likely considering the possibility they will have to raise rates again if inflation climbs any higher. How embarrassing, and unlikely given the soon-to-change-over Chair position toward an appointment that will likely be trigger-happy for rate cuts in nearly six months. 

David Zervos chief Market Strategist at Jefferies, told CNBC that the Fed would be cautious this year after tomorrow’s cut. 

Other analysts, like at ING, see 50 basis points of cuts till for the remainder of the year. Jeremy Siegel, a Business professor at Wharton, put the odds of a December cut high. 

x“I put the odds north of 90% that we get the December cut as well, and I see room for additional quarter-point reductions in early 2026 if the disinflation trend persists,” he said.

AFTER THE BELL 

Brought to You by Stocktwits AI Recaps 

Visa $V ( ▼ 0.27% ) reported Q4 '25 revenue of $10.7B (vs. $10.62B est.) and EPS of $2.98 (vs. $2.97 est.); FY26 adjusted net revenue growth is expected to be in the low double digits and adjusted EPS growth to be in the low double digits.

Bullish

Visa's network of networks now has approximately 12 billion endpoints, about 4 billion cards, bank accounts and digital wallets each.

Bearish

Guidance assumes the macroeconomic environment stays generally where it is today, but competitors have noted choppiness in the economy and consumers trading down on discretionary items.

Enphase Energy $ENPH ( ▼ 0.3% ) 

Enphase beat Q3 estimates but guided Q4 revenue below consensus, citing weak demand in Europe and California. Shares fell ~9% after hours on the soft outlook.

Electronic Arts $EA ( ▼ 0.1% ) 

EA beat EPS estimates but posted a 13% YoY sales decline and suspended guidance amid a $55B go-private deal.

POPS & DROPS

Top Stocks News Stories 

1. Royal Caribbean fell 9% after weak Q4 forecast.
2. UnitedHealth raised guidance but flagged Medicaid headwinds.
3. Ramaco fell 16% after Jefferies downgrade.
4. Kenvue sued by Texas AG over Tylenol marketing.
5. Celestica rose 8% on strong Q3 earnings.
6. TeraWulf jumped 16% on FluidStack AI partnership.
7. Skyworks and Qorvo rose 5–6% on $22B merger news.
8. SoFi Technologies rose 4% after boosting 2025 guidance.
9. PayPal climbed 5% after boosting forecast and ChatGPT wallet launch.
10. UPS rose 7% after cutting 48,000 jobs and closing 93 sites.

WHAT’S ON DECK

Tomorrow’s Top Things

Economic data: Trade Balance (8:30 AM), Retail Inventories (8:30 AM), Crude Oil Inventories (10:30 AM), Atlanta Fed GDPNow Q3 (11:30 AM), Fed Interest Rate Decision (2:00 PM) 

Pre-Market Earnings: Boeing ($BA) and Verizon Communications ($VZ).

After-Market Earnings: Meta Platforms ($META), Microsoft ($MSFT), Alphabet ($GOOG), Starbucks ($SBUX), Chipotle Mexican Grill ($CMG), Bausch Health Companies ($BHC), Teladoc Health ($TDOC), and Carvana ($CVNA). 

Earnings expectations for Meta, Microsoft, and Alphabet based on Yahoo Finance analysis: 

Meta Platforms $META

1. EPS: $6.67
2. Revenue: $49.55B
3. YoY Growth: +22.1% revenue, +10% EPS
4. Key Drivers: Strong ad revenue (+21%), AI-driven ad efficiency, 3.49B daily active users expected.

Microsoft $MSFT

1. EPS: $3.66
2. Revenue: $75.39B
3. YoY Growth: +15.1% revenue, +11% EPS
4. Key Drivers: Azure cloud growth (+37%), $30B+ AI infrastructure spend, strong enterprise demand.

Alphabet $GOOG/GOOGL

1. EPS: $2.27
2. Revenue: $100.14B
3. YoY Growth: +13.2% revenue
4. Key Drivers: Search and YouTube ad strength, Google Cloud growth (+29%), AI-enhanced ad targeting.