Stocks Slide as “SaaSpocalypse” Returns; Nvidia Drops Again and Bank Fears Mount
Wall Street’s worry list grew longer Friday as selling in software stocks spread across the broader technology sector and into banks.
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Dow Jones Industrial Average: -1.05%
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$S&P 500(.SPX)$ : -0.43%
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Nasdaq Composite: -0.92%
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Hot Stock: Dell Technologies (+21.9%) Biggest Loser: United Airlines (-8.7%)
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Best Sector: Healthcare (+1.8%) Worst Sector: Information Technology (-2.2%)
Software Rally Fizzles
The $iShares Expanded Tech-Software Sector ETF(IGV)$ had rallied 7% from Tuesday through Thursday. On Friday, selling resumed, with the ETF falling 1.3%.
$IGV
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AI disruption risks
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Slowing enterprise spending
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Elevated valuations
Nvidia Extends Post-Earnings Slide
$NVIDIA(NVDA)$ fell another 4.2%, bringing its two-day decline to 9.4% despite strong earnings earlier in the week.
The move signals lingering concerns about:
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Sustainability of AI capital expenditures
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Peak data-center demand
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Margin durability
Other major tech names also dropped:
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$Apple(AAPL)$ : -3.2%
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$Meta Platforms, Inc.(META)$ : -1.3%
Two Magnificent Seven stocks managed gains:
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$Amazon.com(AMZN)$ : +1% after announcing a $50 billion AI investment deal with OpenAI
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Alphabet: +1.4%
Still, tech broadly underperformed, with Information Technology the worst sector (-2.2%).
Bank Stocks Hit by Private Credit Concerns
The selloff extended beyond tech.
The KBW Nasdaq Bank Index plunged 4.9%, its worst day since last October.
KWB
A note from Wells Fargo analyst Mike Mayo warned of potential new “cockroaches”, a term popularized by Jamie Dimon to describe hidden credit risks that tend to surface in clusters.
The immediate concern followed the collapse of Market Financial Solutions in London and broader stress in non-bank commercial credit markets.
The fear: isolated loan defaults could spread anxiety across financial institutions.
Inflation Heats Up Again
PPI
Friday also brought fresh inflation worries.
The Bureau of Labor Statistics reported that January’s Producer Price Index (PPI) rose 0.5% month over month, hotter than December’s 0.4% increase.
While bond markets remained relatively calm, the data adds to concerns that inflation may remain sticky heading into:
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Next week’s ISM Manufacturing PMI
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The Services PMI
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Friday’s jobs report
Persistent wholesale inflation could complicate expectations for Federal Reserve rate cuts later this year.
What to Watch Next Week
Investors will be looking for a catalyst to break markets out of their current range.
Key events ahead:
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U.S. jobs report (Friday)
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ISM Manufacturing PMI (Monday)
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ISM Services PMI (Wednesday)
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Earnings from CrowdStrike, Target, Broadcom, and Costco
With tech under pressure, banks wobbling, and inflation reemerging as a concern, the market’s worry list is growing, not shrinking…
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