📈 Market Crashing?

Here's why we sold off on Friday...

Market Crashing?

On Friday we saw significant selling in the market, down over 2% on the NASDAQ and 1.7% on the S&P 500.

Here’s what brought the market down:

1. Speculation that MSFT will cut data center spending and CAPEX.

   This was taken as a bearish sign for the market, as a reduction in CAPEX spend could mean that they are not getting the gains from AI that they are expecting. If this is the case for MSFT, it could apply to AI names across the board. Watch how the stock acts now that we are near support.

2. COVID is back? A Chinese virologist stated that a new coronavirus was found that could potentially infect humans.

   Whether this turns into a larger deal or not obviously remains to be seen. However, with the impact that COVID-19 had on the stock market and society at large, investors are taking a “sell now, think later” approach. Vaccine stocks saw a boost as a result of the news. Travel names are the biggest losers in this news, as names like ABNB, EXPE, and BKNG got smoked on Friday..

   

3. Tariffs and DOGE cuts cause uncertainty.

   Hedge fund manager Steve Cohen came out and stated that he worries that tariffs and DOGE cuts could lead to a significant market correction. His concern is that consumer prices may raise as a result of the tariffs and that a budget reduction could slow GDP.

For more on why these three pieces of news matter and how to take advantage of these themes in the market, watch this video: