💰Major indices opened high and continued to rise, with most tech stocks seeing green.
💹 $Astera Labs, Inc.(ALAB)$/$Marvell Technology(MRVL)$/$Broadcom(AVGO)$ : Catch those stalwart performers in the semiconductor sector.
📣 Stay tuned and supercharge purchasing power with CashBoost!
The market's been soaring, as Trump's words brought some cheer, and the Fed's signals gets clear.
| Market recap
The market has seen consecutive gains on Wednesday and Thursday, accumulating over 5% since Tuesday. A more conciliatory stance from Trump, combined with positive signals from the Federal Reserve, has buoyed the market. Stocks that were at recent price lows, particularly large tech stocks that had faced significant pressure earlier, showed even higher gains.
On Thursday, remarks from the Fed’s Christopher Waller provided a crucial boost, with both $S&P 500(.SPX)$ and $NASDAQ(.IXIC)$ rising over 2%, led by chip stocks, with $VanEck Semiconductor ETF(SMH)$ gaining over 5%.
$NASDAQ Golden Dragon China Index(HXC)$ has risen 7.7% this week, outperforming the broader market, with $Canadian Solar(CSIQ)$ up 18% and $Daqo New(DQ)$ up 4%. $Kingsoft Cloud Holdings Ltd(KC)$ is poised for a rebound, gaining 13.6% this week.
Megacaps - see V again
$NVIDIA(NVDA)$ opened strongly and closed up 3.6%, leading the Magnificent 7. According to reports from Chinese media, some companies have announced exemptions from increased tariffs on semiconductor imports from the U.S., meaning that certain chip imports are seeing tariffs drop from 125% to 0%.
Next week, the rest of Mag 7, $Apple(AAPL)$, $Meta Platforms, Inc.(META)$, $Microsoft(MSFT)$, and $Amazon.com(AMZN)$, will release their earnings reports. Stay tuned.
MAGA vs Fed (con.)
Why are the Fed's recent remarks particularly significant? In contrast to Powell's cautious wording (read: vague), Waller laid it out clearly, stating that if Trump were to implement aggressive tariffs (potentially spiraling out of control), it could lead to a sharp spike in unemployment, at which point he would support rate cuts. This statement reassured Wall Street, leading to a renewed focus on previously oversold growth stocks.
Top movers - SaaS, energy
Thanks to stellar earnings, AI-driven innovation is reigniting market enthusiasm, with $ServiceNow(NOW)$ leading the SaaS sector, pushing $Atlassian Corporation PLC(TEAM)$ up 8%, $Monday.com Ltd.(MNDY)$ up 7%, and $Workday(WDAY)$ up 5%.
Data center demands have surged, boosting $Oklo Inc.(OKLO)$ by 5%, $NuScale Power(SMR)$ by 7%, and $New Fortress Energy LLC(NFE)$ by 12%.
BTC surged past $9,400, lifting related stocks $TeraWulf Inc.(WULF)$ by 9%, $Bit Digital, Inc.(BTBT)$ by 6%, and $Hut 8 Mining Corp(HUT)$ by 5%.
| AIDC revisited
Executives from Amazon and NVIDIA stated on Thursday that despite recession fears leading investors to speculate about potential cutbacks by tech companies, the pace of building AI data centers has not slowed.
Concerns over an economic downturn have led some investors to question whether tech firms would reduce certain initiatives. Goldman Sachs economist Jan Hatzius believes that the continued imposition of additional "reciprocal" tariffs or more aggressive tariffs on specific goods would make a U.S. recession inevitable.
NVIDIA has noted that AI is driving a continuous rise in computational power and energy demand. Anthropic co-founder Jack Clark predicts that by 2027, there will be a need for an additional 50 gigawatts of power supply to support AI development, equivalent to the output of about 50 new nuclear power plants.
| AI investments: Smart investors act fast
Market interest in AI investments remains strong, driving stock prices of standout companies higher.
ALAB
$Astera Labs, Inc.(ALAB)$ provides data center connectors designed to enhance data transmission efficiency between servers, reducing latency and loss.
NVIDIA and Amazon are both customers of ALAB, with Amazon also being a strategic investor.
The company will announce its Q1 earnings on May 7. Benefiting from strong cash flow, ALAB is expected to further improve its performance. In Q4, the company reported free cash flow of $24.3 million, with a free cash flow margin of 17.2%. For the full year 2024, free cash flow is projected to be $102.4 million, with a margin of 25.8%.
MRVL
$Marvell Technology(MRVL)$ holds a dominant position among cloud computing clients, offering significant growth potential.
The AI data center business is the company's largest revenue source, accounting for 75%. With support from major customers like Amazon and Google, MRVL is also at the forefront of ASIC design.
MRVL is set to release its Q1 earnings in late May. In the last fiscal year's Q4, the company reported revenue of $1.82 billion, a 27.4% year-over-year increase, with full-year revenue reaching a record high of $5.77 billion.
AVGO
$Broadcom(AVGO)$ has been deeply involved in the communications sector for many years, holding a 70% market share in the data center networking space.
In addition to its customized XPU, Broadcom's Tomahawk and Jericho series are solutions specifically designed for AI data centers.
The company has established close partnerships with $Alphabet(GOOGL)$, META, and ByteDance to co-develop customized AI chips. Broadcom anticipates that its future AI revenue could reach $75 billion, representing significant potential.
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Good read