US market recovered some lost grounds on Thu, 29 May 2025.
The rally that was “expected” when news broke that US Court of International Trade overruled Trump’s tariffs exploitation, melted away as US Federal court performed a U-turn.
On Thursday, it granted the Trump administration’s request to temporarily pause US Court of International Trade ruling that struck down Trump’s tariffs.
The tariffs see-saw played out at US courts, overall dampened market sentiments.
Euphoria recorded by US pre-market indicators trended lower and lower as the day progressed.
And just like that, by the time market closed: (see above)
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DJIA: +0.28% (+117.03 TO 42,215.73).
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S&P 500: +0.4% (+23.62 TO 5,912.17).
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Nasdaq: +0.39% (+74.93 to 19,175.87). 2,673 stocks rose and 1,806 fell as advancing issues outnumbered decliners by a 1.48-to-1 ratio.
Trading volume on US exchanges was 18.65 billion shares, compared with the 17.7 billion average for the full session over the last 20 trading days.
Is this a sign of traders’ panicking ?
US Weekly Jobless claims.
Another party pooper was US weekly jobless claims report for week ending 24 May 2025. (see below)
Number of Americans applying for new jobless benefits increased more than the 229,000 expected. (see above)
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US Labour Department report showed a surge in applications (+14,000 initial claims) to 240,000 claims.
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Just a week prior (week ending 17 May 2025), new claims fell to 226,000 from from 229,000.
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Initial unemployment claims filed under programs for Federal government employees (under close scrutiny due to firings by Trump’s Department of Government Efficiency (DOGE), rose by +15 to 610.
At the same time, unemployment rate appeared to have picked up in May 2025, suggesting layoffs were rising as tariffs cloud the economic outlook.
US Continuing Claims.
What is more concerning is US Continuing claims for week ending 17 May 2025. (see below)
Continuing claims has increased by +26,000 to a seasonally adjusted 1.919 million.
This is the highest reading since November 2021, the claims report showed.
Elevated continuing claims reflect companies' hesitance to increase headcount.
Another thing to note is continuing claims covered the period during which US government surveyed households for May's unemployment rate.
With continuing claims increased between the April & May survey periods, an uptick in the unemployment rate for May 2025, is likely as tariffs cloud US economic outlook.
According to JP Morgan, Analyst, Abiel Reinhart, "persistently high continuing claims data, raises the risk that the unemployment rate could tick up to 4.3% in the May employment report".
Pre Inflation Report Jitters.
US market’s Thursday marginal gains could also be interpreted as pre-inflation report jitters, observed the day before Consumer Price Index (CPI) or Personal Consumption Expenditure (PCE) inflation report is released.
For April 2025’s PCE report:
(1) Headline inflation.
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The PCE Price Index is forecast to rise 0.15% in April after falling 0.04% in March.
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Year over year, the PCE Price Index is forecast to rise 2.2% in April, after increasing 2.3% in March.
(2) Core inflation.
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Core PCE is forecast to rise 0.12% in April after rising 0.03% in March.
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Core PCE year over year is forecast to rise 2.5% in April, after increasing 2.6% in March.
Wall Street’s PCE forecast recorded an optimistic “falling” estimates compared to Federal Reserves Bank of Cleveland’s take on PCE for April 2025, that is on the rise across the board. (see below)
Which PCE forecast is more “accurate” ? It’s left to be seen and confirmed !
PLTR closed Low on Friday?
On a sombre note, will $Palantir Technologies Inc.(PLTR)$ continue to pullback further to close off the week ? (see below)
On Thu, 29 May 2025, PLTR fell by -1.16%, closing at $122.32 per share.
According to Wall Streets, there were several factors at play.
(1) High Valuation Concerns:
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PLTR is trading at a very high price-to-earnings (P/E) ratio of 531.83, reflecting significant growth expectations already priced into the stock.
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This elevated valuation has led to caution among investors, especially as the intrinsic value (discounted cash flow) appears disconnected from the current market price.
(2) Mixed Analyst Sentiment:
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Analyst ratings are largely neutral, with a consensus of "Hold" and only a minority recommending "Buy" or "Sell."
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This mixed sentiment, combined with price targets averaging below the current share price, has contributed to uncertainty and selling pressure.
(3) Lower Trading Volume:
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PLTR’s trading volume on 29 May 2025, was significantly below average (62.92 million vs the average of 104.11 million).
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This suggest less conviction behind recent price movements and possibly indicating waning investor enthusiasm in the short term.
(4) Technical Consolidation:
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After a strong rally in previous weeks, the stock appeared to be consolidating, with technical indicators signaling neutral momentum and the price testing support and resistance levels in a narrow range.
(5) Insiders’ Selling turnoff ?
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Recent wave of insider selling at PLTR has sparked concern / debate among investors.
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Does this signal loss of confidence in the company's future, OR is it a disciplined wealth-management move by executives who remain deeply invested in the firm's success?
Just for the record:
Between March and May 2025, Palantir's executives and directors sold an astonishing $14.4 billion worth of shares.
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CEO Alex Karp sold 50.4 million shares (valued at ~$6.4 billion) in May 2025, retaining 6.4 million shares.
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CTO Shyam Sankar unloaded 21.2 million shares (~$2.7 billion), holding onto 1.45 million shares post-sale.
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Officer Ryan Taylor sold nearly 5 million shares (~$629 million), while keeping 364,000 shares.
Thankfully, most of these transactions were conducted through pre-arranged Rule 10b5-1 trading plans, that are designed to avoid accusations of trading on insider information.
Despite the scale of sales, PLTR insiders still retained substantial stakes in the company.
This indicates ongoing confidence in Palantir’s long-term prospects.
But the sheer volume of insider selling at peak prices - likely contributed to investor caution and may have added downward pressure to the stock price as some interpreted it as profit-taking amid high valuations.
PLTR’s Fundamentals.
Going back to basics, it is imperative to look at a stock’s fundamentals, when in doubt.
(1) Q1 2025's earnings performance.
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Its latest revenue jump by +39% YoY to $815 million.
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The “good” results have largely been driven by (a) Defense & Government Contracts and (b) Enterprise expansion.
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PLTR’s AI-driven analytics platforms are critical to modern military logistics and intelligence operations.
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And US agencies are accountable for 60% of revenue.
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Growth in (i) Healthcare, (ii) Energy, and (iii) Finance sectors, where PLTR’s Foundry platform automates complex data workflows.
(2) The MiddleEast Partnership ?
Analysts also speculate about the Middle East partnerships.
This comes as :
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Rumours of CEO Karp's April 2025 visit to Saudi Arabia.
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CEO Karp was part of Trump’s delegate that visited the Middle East that participated in the US-Saudi Investment Forum and a luncheon hosted by the Saudi royal court - just this May 2025.
Optimistically, all these could unlock billions in new contracts.
While details remain scarce, the geopolitical buzz should be viewed optimistically.
(3) Moving Averages.
Last but not least, PLTR is trading significantly above its 20-day, 50-day, and 200-day moving averages. (see above)
This reflects strong medium- and long-term momentum.
This technical setup is typically bullish, suggesting that the prevailing trend remains upward.
Should we hawk over the current pullback and buy the dip, given all factors pointing to a brighter PLTR ?
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Do you think PLTR will continue to dip or rise on Fri, 30 May 2025 ’?
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Do you think PLTR’s corrections are temporary. It will rise further when new contracts are announced ?
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