Good Morning!
On Monday, January 27, the S&P 500 closed at 6,012.28, up 0.75% during the trading session, following a 2.16% selloff in pre-market trading. The NASDAQ experienced a 3.5% pre-market drop but climbed 0.58% during yesterday's session, finishing at 19,341.83 points. The Dow Jones Industrial Average fared much better, rising 1.29% to close at 44,713.58. Meanwhile, the Russell 2000 advanced 0.8%, ending the trading session at 2,314.
Nvidia is already up 2.41% in pre-market trading, signaling a possible quick turnaround following the Deepseek-induced market selloff.
Crypto Highlights
Bitcoin (BTC): Currently trading at $102,491, up 1.71% over the past 24 hours.
Ethereum (ETH): Up 2.14%, now trading at $3,170.07 per coin.
Solana (SOL): Up 2.05%, currently trading at $235.87.
Ripple (XRP): Surged 9.32% in the last 24 hours, now trading at $3.14 per coin.
Yesterday's Earnings
AT&T (T): Actual EPS: $0.54 (Beat by 10.20%), Expected EPS: $0.49, Actual Revenue: $32.30B (Beat by 0.72%), Expected Revenue: $32.07B, Market Cap: $173.21B
Brown & Brown (BRO): Actual EPS: $0.86 (Beat by 11.69%), Expected EPS: $0.77, Actual Revenue: $1.20B (Beat by 7.14%), Expected Revenue: $1.12B, Market Cap: $30.84B
Nucor (NUE): Actual EPS: $1.22 (Beat by 58.44%), Expected EPS: $0.77, Actual Revenue: $7.08B (Beat by 3.97%), Expected Revenue: $6.81B, Market Cap: $28.64B
WR Berkley (WRB): Actual EPS: $1.13 (Beat by 14.14%), Expected EPS: $0.99, Actual Revenue: $3.01B (Beat by 1.01%), Expected Revenue: $2.98B, Market Cap: $22.56B
Alexandria Real Estate (ARE): Actual EPS: -$0.38 (Miss by 141.30%), Expected EPS: $0.92, Actual Revenue: $788.95M (Beat by 1.31%), Expected Revenue: $778.72M, Market Cap: $17.84B
Earnings Today
RTX Corp (RTX): Actual EPS: $1.54 (Beat by 11.59%), Expected EPS: $1.38, Actual Revenue: $21.62B (Beat by 5.31%), Expected Revenue: $20.53B, Market Cap: $166.44B
Stryker (SYK): Actual EPS: --, Expected EPS: $3.87, Actual Revenue: --, Expected Revenue: $6.36B, Market Cap: $152.45B
Boeing (BA): Actual EPS: -$5.90 (Miss by 239.08%), Expected EPS: -$1.74, Actual Revenue: $15.24B (Miss by 10.58%), Expected Revenue: $17.04B, Market Cap: $131.05B
Lockheed Martin (LMT): Actual EPS: $7.67 (Beat by 16.57%), Expected EPS: $6.58, Actual Revenue: $18.60B (Miss by 1.27%), Expected Revenue: $18.84B, Market Cap: $119.39B
Starbucks (SBUX): Actual EPS: --, Expected EPS: $0.6803, Actual Revenue: --, Expected Revenue: $9.35B, Market Cap: $113.62B
Chubb (CB): Actual EPS: --, Expected EPS: $5.34, Actual Revenue: --, Expected Revenue: $12.26B, Market Cap: $111.45B
Royal Caribbean Cruises (RCL): Actual EPS: $1.63 (Beat by 9.40%), Expected EPS: $1.49, Actual Revenue: $3.76B (Met Expectations), Expected Revenue: $3.76B, Market Cap: $63.68B
General Motors (GM): Actual EPS: $1.92 (Beat by 11.63%), Expected EPS: $1.72, Actual Revenue: $47.70B (Beat by 11.64%), Expected Revenue: $42.73B, Market Cap: $60.39B
PACCAR (PCAR): Actual EPS: $1.66 (Miss by 2.35%), Expected EPS: $1.70, Actual Revenue: $7.91B (Beat by 4.49%), Expected Revenue: $7.57B, Market Cap: $57.63B
Kimberly-Clark (KMB): Actual EPS: $1.50 (Miss by 0.66%), Expected EPS: $1.51, Actual Revenue: $4.93B (Beat by 1.44%), Expected Revenue: $4.86B, Market Cap: $43.82B
Sysco (SYY): Actual EPS: $0.93 (Beat by 1.09%), Expected EPS: $0.92, Actual Revenue: $20.20B (Beat by 0.45%), Expected Revenue: $20.11B, Market Cap: $37.76B
Synchrony Financial (SYF): Actual EPS: $1.91 (Beat by 1.06%), Expected EPS: $1.89, Actual Revenue: $3.80B (Miss by 1.04%), Expected Revenue: $3.84B, Market Cap: $27.20B
Packaging Corporation of America (PKG): Actual EPS: --, Expected EPS: $2.51, Actual Revenue: --, Expected Revenue: $2.12B, Market Cap: $21.38B
F5 Networks (FFIV): Actual EPS: --, Expected EPS: $3.36, Actual Revenue: --, Expected Revenue: $715.45M, Market Cap: $15.42B
Boston Properties (BXP): Actual EPS: --, Expected EPS: $0.4823, Actual Revenue: --, Expected Revenue: $836.85M, Market Cap: $11.79B
Qorvo Inc (QRVO): Actual EPS: --, Expected EPS: $1.21, Actual Revenue: --, Expected Revenue: $902.60M, Market Cap: $8.28B
Invesco (IVZ): Actual EPS: $0.52 (Beat by 8.33%), Expected EPS: $0.48, Actual Revenue: $1.16B (Met Expectations), Expected Revenue: $1.16B, Market Cap: $7.98B
Headlines
Nvidia Suffers $600 Billion Market Cap Loss Amid DeepSeek AI Fears
Nvidia experienced a historic $600 billion market cap loss on Monday, marking the largest single-day decline for a U.S. company. Shares plummeted 17%, closing at $118.58, as concerns about Chinese AI lab DeepSeek intensified. The sell-off rippled across the tech-heavy Nasdaq, which fell 3.1%, with other data center-reliant companies like Dell, Oracle, and Broadcom also seeing significant declines.
The market turmoil follows DeepSeek’s launch of a groundbreaking, cost-efficient AI model that challenges U.S. dominance. Despite using lower-tier Nvidia H800 chips, DeepSeek’s technology has sparked fears of reduced GPU demand. Analysts, however, remain optimistic about Nvidia's long-term prospects, citing the industry's growing need for advanced AI computing.
White House Orders Halt on Federal Loans and Grants, Sparking Legal and Economic Concerns
The Trump administration’s Office of Management and Budget (OMB) has issued a directive halting federal loans, grants, and financial aid, creating widespread uncertainty and alarm. The memo, signed by Acting Director Matthew J. Vaeth, paused disbursements across critical areas, including disaster relief, education, transportation, and small business loans. The scope of the order and its legal basis remain unclear, with Senator Chuck Schumer condemning the move as a violation of Congress's authority.
The memo specifically cited programs tied to "D.E.I., woke gender ideology, and the Green New Deal" as targets for suspension.
OpenAI's Sam Altman Praises DeepSeek's AI Model, Promises Superior Next-Gen Innovations
OpenAI CEO Sam Altman called DeepSeek's R1 model "impressive" on Monday, acknowledging its strong problem-solving capabilities and efficient use of computer chips. Altman pledged that OpenAI would soon deliver "much better models," emphasizing that increasing computational power remains vital to advancing AI technology. His comments came amid the disruptive impact of DeepSeek's announcement on global markets and U.S. tech giants like Meta, as the Chinese startup’s cost-efficient model has demonstrated performance on par with leading Western platforms.
Oracle and Microsoft Advance in Talks for TikTok Takeover
Oracle and Microsoft are reportedly in advanced negotiations with investors to gain control of TikTok's global operations, a move aimed at addressing regulatory concerns about data security tied to TikTok’s Chinese parent company, ByteDance. Under the proposed structure, ByteDance would retain a minority stake, while Oracle would oversee TikTok’s platform infrastructure, including data systems and algorithms. Microsoft, participating in the negotiations, hopes to solidify its role after a failed bid to acquire TikTok in 2020.
The talks come amid intensified scrutiny of TikTok’s data handling practices, with the U.S. government citing potential national security risks of data being shared with Chinese authorities. The Trump administration has granted ByteDance a 75-day grace period to avoid enforcement actions tied to divestiture orders. As regulatory pressures mount globally, including a market ban in India and privacy lawsuits, the deal could significantly reshape TikTok’s future while tackling concerns over data protection and governance.
Denmark Allocates $2 Billion to Arctic Defense Amid Renewed U.S. Interest in Greenland
Denmark announced a significant investment of 14.6 billion Danish kroner ($2.05 billion) to enhance its military presence in the Arctic, following U.S. President Donald Trump's revived interest in acquiring Greenland. The funds will go toward boosting surveillance capabilities, sovereignty efforts, and NATO support in the region, including the addition of three Arctic naval vessels, long-range drones, and expanded Arctic military training. Denmark’s Defense Minister Troels Lund Poulsen emphasized the importance of addressing security challenges in the Arctic and North Atlantic, with Greenland’s Minister of Foreign Affairs, Vivian Motzfeldt, noting a shifting security landscape for the semi-autonomous territory.
Trump’s repeated assertions that Greenland is an "absolute necessity" for U.S. national security have reignited geopolitical tensions. Both Denmark and Greenland firmly reject the idea of selling the territory, while the EU has backed Denmark's sovereignty. Greenland’s strategic importance—due to its proximity to Russia and China’s growing Arctic presence—has fueled U.S. interest despite Denmark’s resistance.
NextEra Partners with GE Vernova to Build Gas Generation Projects Amid Growing Energy Demand
NextEra Energy and GE Vernova have announced a partnership to accelerate the development of gas turbine projects to address the rising energy needs of large-load customers, such as data centers. Over the next four years, the companies plan to identify key locations on the U.S. energy grid for these projects. According to NextEra CEO John Ketchum, the plants, co-owned by the two companies, will integrate renewables, energy storage, and gas-fired generation technologies provided by GE Vernova. While renewable energy projects remain cheaper and quicker to deploy, Ketchum emphasized that new gas plants are necessary for "energy dominance" and to curb price hikes amid increasing demand, though these projects might not come online until 2030.
Despite a strong focus on renewables, including record-setting contracts for 12 GW of wind, solar, and storage projects in 2024, NextEra is also exploring nuclear options, such as small modular reactors. The company is progressing with plans to reopen the Duane Arnold nuclear power plant in Iowa by 2028.
Germany's Russian LNG Imports Surge Despite De Facto Ban
Germany has seen a dramatic increase in imports of Russian liquefied natural gas (LNG) through other EU ports, particularly in France and Belgium, despite its de facto ban on direct Russian LNG shipments. According to a report by NGOs from Germany, Belgium, and Ukraine, Germany's state-controlled Securing Energy for Europe (Sefe) purchased 58 LNG cargoes from Russia via France’s Dunkirk terminal in 2024, a sixfold rise from 2023.
The EU has not banned Russian LNG outright, despite its goal of phasing out Russian gas by 2027. Once LNG cargoes enter the EU pipeline network, tracking their origin becomes virtually impossible. This lack of traceability complicates efforts to curb reliance on Russian gas, even as some member states advocate for a total ban.
BOJ Likely to Raise Rates Again by Mid-2025, Targeting 1.5% by 2026, Says Ex-Policymaker
The Bank of Japan (BOJ) is expected to raise interest rates again by June or July and aims to gradually increase its policy rate to 1.5% within the next two years, former BOJ board member Makoto Sakurai said Tuesday. The move follows last week's hike to 0.5%, the highest level since the 2008 financial crisis, signaling the central bank's confidence in Japan's economic recovery and sustained price and wage growth.
Sakurai suggested the BOJ might even advance the timing of its next rate hike to April, citing potential domestic political pressures ahead of Japan's upper house election in July. With Prime Minister Shigeru Ishiba’s coalition facing weak approval ratings, the BOJ could factor in political considerations. BOJ executives reportedly see 1.5% as a target rate by 2026, providing room to lower rates during future economic downturns.
DeepSeek AI Allegedly Using Banned Nvidia H100 Chips: Scale AI CEO
DeepSeek AI's use of 50,000 Nvidia H100 GPUs, despite U.S. export restrictions to China, has sparked a major controversy in the tech industry. Alexandr Wang, CEO of Scale AI, revealed that the Chinese startup is leveraging these high-performance chips, which are banned under U.S. regulations, to power its cutting-edge AI model. DeepSeek employees are reportedly unable to publicly discuss their use of these chips due to regulatory constraints.
The revelation, made during Wang’s CNBC interview, triggered a market selloff, with Nvidia’s stock dropping 16.9% and the Nasdaq composite falling 3.1%, its sharpest decline in over a month. While initially believed to use Nvidia’s downgraded H800 chips, DeepSeek's reliance on the H100 underscores its competitive edge, challenging U.S. dominance in AI. Elon Musk seemed to support Wang's claims, responding “obviously” to a related post.
