• The Nasdaq Composite keeps hitting new highs after rising one percent for the week ended July 25th. That was helped by a week of largely favorable earnings from the likes of Alphabet, Coursera, and AT&T.

• Some are asking if we are heading toward the end of a decade-plus bull market, which is a fair question to ask given the massive change coming to the global economy. 

• Tariffs on goods imported to the U.S. are on track for their highest level in a century, based on deals announced by U.S. President Donald Trump with the EU, Japan and other nations, and what may come from further talks with the Chinese. 

• As The Financial Times’s Aime Williams, Alan Smith, Jonathan Vincent, and Emily Herbert write in a piece on Monday, the U.S. is on track for a 17.3% average tariff rate across all of its agreements so far — the highest level since the 1930s.

Far be it from me to be a Negative Nancy, but when I hear about a penny-stock name that’s suddenly surging on artificial intelligence euphoria, I have my doubts. 

Shares of six-year-old Graphjet Technology, based in Malaysia, are soaring by over forty percent on Monday, to $0.14 a share, after the company issued a press release saying that they were going to benefit in a big way after Tesla announced it is entering into an agreement with Samsung Electronics to make Tesla’s next version of its AI chip at a Samsung factory in Texas. 

Before today’s surge, the company’s stock had collapsed by eighty-four percent this year, and ninety-six percent in the past twelve months.

Tesla CEO Elon Musk posted on Twitter, “Samsung’s (SSNLF) giant new Texas fab will be dedicated to making Tesla's next-generation AI6 chip. The strategic importance of this is hard to overstate. Samsung currently makes AI4. TSMC (Taiwan Semiconductor) will make AI5, which just finished design, initially in Taiwan and then Arizona." 

Reuters’s  Heekyong Yang and Hyunjoo Jin relate that Musk subsequently tweeted, “The $16.5B number is just the bare minimum,” meaning, the projected revenue for Samsung. 

In response, Graphjet issued a press release titled, “Samsung and Tesla collaboration to benefit Graphjet.”

One of my worst calls this year was writing in January that Palantir must go down because it was valued at an outrageous fifty-six times projected revenue.

A hundred and ten percent later, the stock, at a recent $158.80, trades for an even-more-ridiculous eighty-nine times forward revenue.

Oh, well. Some people are coming off the sidelines. Piper Sandler software analyst Brent Bracelin on Friday initiated coverage of Palantir with an Overweight rating, and a price target of $170, while suggesting people buy the stock on the dip.

“We have monitored PLTR for 5+ years,” writes Bracelin. He has concluded that Palantir has “a one-of-a-kind growth+margin model that if proven durable could grow into a $24B run-rate by CY32E via share gains across two $1+ trillion TAMs,” those being its defense sector and enterprise markets.

Now, however, Palantir has “a one-of-a-kind growth+margin model that if proven durable could grow into a $24B run-rate by CY32E via share gains across two $1+ trillion TAMs,” those being its defense sector and enterprise markets.

“We see PLTR as an AI secular winner,” writes Bracelin. For me, the key slide in his note is the one showing the relative paucity of high-growth software companies:

Intel shares are up fractionally in late trading Thursday, at $22.71, after the company topped expectations with its quarterly revenue forecast, only the second time the company has beaten with its outlook in the past year and a half.

The stock soon gave up the gains and is now down a point.

It may be reason to celebrate, though the company is hardly out of the woods. The upside in the forecast is entirely a result of analysts having cut their own estimates massively. 

The current consensus estimate is twenty-two percent lower than it was a year ago, a sign of how far Intel’s prospects have fallen.

Recently appointed CEO Lip-Bu Tan said in prepared remarks that “Our operating performance demonstrates the initial progress we are making to improve our execution and drive greater efficiency.” 

Tan came aboard in March, promising to refashion Intel in a way that goes back to its roots “as an engineering-led company.”

Just a quick recap of the first flood of earnings reports overnight. In brief, shares of chip maker MaxLinear, Alphabet, ServiceNow, and BE Semiconductor are all rising nicely while Tesla and IBM are the standout disappointments.

DATA CENTER CHIP BRIGHT SPOT

The simplest of these is MaxLinear, a small-cap, or, you could even say, micro-cap ($1.3 billion) analog chip maker that specializes in communications chips that go into cellular infrastructure but also data centers. The stock had been down twenty-three percent this year prior to the report, but it’s up twenty-two percent in early trading.

Like a lot of analog chip makers, it’s a story of the company’s end markets turning a corner. “we think MXL has undoubtedly turned the corner with a multi-year growth cycle ahead,” writes David Williams with The Benchmark Company this morning.

“These are the industries that have been slowest to digitize, not because they're slow but because they're complex.”

It sure feels like tech stocks on Tuesday afternoon are just taking a breather after racking up new all-time high prices for many weeks now.

The Nasdaq Composite is down less than a point, but most of Mega-Cap tech is falling harder, with conspicuous declines in Applied Materials, Broadcom, Dell Technologies, Advanced Micro Devices, Oracle, and Nvidia, among others. Many of those had hit or were close to hitting new lifetime high prices in recent days.

There are, however, a couple things in play today to perhaps give investors pause about the state of the world.

They include two announcements overnight, one from chip maker NXP Semiconductor, a broad-based supplier of analog chips that go into cars and consumer goods and industrial equipment; and a profit warning from European telecom equipment stalwart Nokia tied to the weaker U.S. dollar and also the expected impact of tariffs.

In the case of Nokia, which will formally report its quarterly results on Thursday morning, the company surprised the market Tuesday morning with a terse statement that said that its operating profit for this year will come in lower than expected. Nokia shares fell almost six percent.

• Stocks keep hitting new all-time highs, as the Nasdaq Composite closed the week of July 14th to 18th with a two-percent gain.

• Among new highs, Microsoft and Nvidia, while Mega Cap names close to all-time highs include Broadcom, Oracle, SAP SE, Texas Instruments and Taiwan Semiconductor Manufacturing. 

• So many others can be included in the group of at-or-almost-at-new-all-time-high-prices, such as Amphenol, Coinbase, Robinhood Markets, RocketLab, Flex, KLA Corp.

• We’re not out of the woods as far as the U.S. tariff regime. Keep in mind the observation of The Financial Times’s Oliver Roeder, Eva Xiao and Molly Taylor this weekend: “If all of [U.S. President Donald] Trump’s policies announced by July 13 are implemented […] the average effective tariff rate for US consumers could rise as high as 20.6 per cent — the highest since 1910, according to estimates by Yale’s Budget Lab.”

A three-quarter streak of price jumps ended Thursday evening for Netflix as the stock sagged in late trading following the company’s second-quarter earnings report. 

It was an upbeat report, however, and it’s not surprising to see people taking profits after a forty-three percent gain in the stock this year, at Thursday’s close of $1,274.17. 

The outlook is robust and should keep the shares in favor. The forecast for this quarter’s revenue, $11.5 billion, is two percent higher than consensus, which is the biggest upside in the quarterly forecast in years. The company also raised its year revenue outlook for the second time since it issued it back in October 

All this is very validating for the multiple analysts who raised their ratings back in January. 

The quarterly report Thursday morning of Taiwan Semiconductor, the largest chip manufacturer in the world, was quite a contrast to the dour tone of chip-equipment maker ASML on Wednesday. 

Just like ASML, Taiwan Semi is seeing increased uncertainty because of global trade riffs. But demand from companies such as Nvidia to make artificial intelligence chips is even stronger than it was in April, according to TSM’s CEO C.C. Wei. His company is racing to “fill the gap” between escalating demand and how many chips he can manufacture.

The shares rose Thursday by over three percent, and gave a lift to Nvidia and other stocks, but there was an odd dichotomy here: Wei’s outlook for this year is going higher even as he urges caution.

The outlook this year’s revenue is now for “around thirty percent” growth, up from what Wei forecast in April would “mid-twenties-percent.” 

At the same time, Wei is keeping the company’s outlook for capital spending this year the same, despite the fact that he is building factories all over the world, in Japan, in Germany, in the U.S., and in Taiwan at a pace the company has never been on before. Taiwan Semi is one of ASML’s biggest customers, and that prudence doesn’t help ASML at the moment. 

Shares of chip-equipment maker ASML closed down eight percent Wednesday, after the Dutch company’s earnings report Wednesday morning offered a repeat of the dour tone in April: lots of uncertainty in the world.

ASML is our first read on how the chip-equipment market tshis earning’s season, so the negative tone of the report put a damper on shares of peers including Applied Materials and KLA and Lam Research.

My take on things is that it’s all about the tariffs, and the uncertainty that the U.S.’s on-again, off-again tactics are having. ASML’s management is signaling that its customers are not sure what’s going to happen with their own costs, nor with global GDP this year and next.

The verbiage in the conference call with CEO Christophe Fouquet and CFO Roger Dassen Wednesday morning was, on the surface, baffling. Fouquet said expectations for growth in the business in 2026 that he had previously signaled were now less certain.

His actual remark was that “Against this backdrop,” meaning, tariffs and trade, “while we are still praying for growth in 2026, we cannot confirm it at this stage,” my emphasis added. “We will continue monitoring developments over the coming months.”

The news overnight that Nvidia has been granted permission by the U.S. government to resume selling its artificial intelligence chip to customers in China has sharply lifted not only Nvidia stock but also the broader tech market, yet another sign of the enormous role the company is playing as a market maker. 

Nvidia shares are up almost five percent after the company announced in press releases and a blog post late Monday that the company has been given assurances from the administration of U.S. President Donald Trump that the export ban on its “H20” chip, a dumbed-down part designed for the Chinese market, will be reversed. That ban had lead to a four-and-a-half-billion-dollar write-down by Nvidia in the April quarter, and lost revenue, the company said in May, of eight billion dollars.

It was said back in May, by Wedbush analyst Matt Bryson said, that politics was the only thing could slow Nvidia. Well, CEO Jensen Huang’s decision to be “politic” about tariffs and trade seems to have been the right move.

• Stocks continue to hit new highs, and many, new all-time highs. During the week ended July 11th, in which the major indices, Nasdaq and S&P 500, were basically flat, several names hit new all-time highs, including Nvidia, Texas Instruments, and Microsoft.

• Many others are near new all-time highs, including Broadcom, Meta Platforms, and Taiwan Semiconductor Manufacturing.

• Others are still trying to get back to all-time highs they had a year ago, such as ASML and Dell and Salesforce.

• These new all-time highs mean you have to tread even more carefully as far as stock-picking, to find things that are not over-priced at the moment relative to their potential.

“There are a lot of things that feel like they're full. There are other companies that feel decidedly overvalued. And then there are some names that feel very reasonable, and some things that are just downright cheap.”

Stocks continue to hit new 52-week highs, and some are hitting new all-time highs, including Broadcom, Microsoft, SAP, and Nvidia.

The last of these, Nvidia, hit a new all-time Wednesday morning of $164.42, a return since it started trading in January of 1999 of 432,000 percent. Not bad.

As you can see in the accompanying chart, adjusted for splits, the past decade for Nvidia stock really stands out. It was 2015 that was the year that things really changed, as Nvidia started to become an AI stock. (The first sixteen years were not bad, though, a return of 181,327 percent.)

This new high is special because it moves Nvidia into a market capitalization of four trillion dollars, the first to make it that far, and well ahead of the next-closest, Microsoft, at $3.8 trillion.

I would imagine no one is particularly moved by this event, as it is not very different from $3.999 trillion, but Dan Ives of Wedbush Securities, one of the biggest fans of Nvidia, remarks today that it “speaks to the AI Revolution hitting its next stage of growth,” which just means that, yes, the AI trade is alive and well. Ives thinks Microsoft “will also hit the $4 trillion market cap club this summer and then over the next 18 months the focus will be on the $5 trillion club,” without making any predictions.

Shares of recently public, debt-laden artificial intelligence darling CoreWeave are down for a second day in a row after the company on Monday morning announced it will purchase data center provider Core Scientific for for nine billion dollars worth of stock, a deal that had been rumored for a month or more.

The acquisition has prompted two downgrades this morning, the main issues being large dilution for CoreWeave shareholders, and the transformation of CoreWeave from what had been an “asset-light” business — not owning too much stuff outright — to now asset-heavy, owning data centers.

CoreWeave is essentially buying its supplier, as Core Scientific makes up almost forty percent of the total data center “footprint” that CoreWeave is using to run GPU chips to process AI.

Last Wednesday brought word that small-cap software maker Datadog is going to have its shares added to the Standard & Poor’s 500 Index this Wednesday, July 9th.

The stock soared the next day, Thursday, by fifteen percent, which is typical of an S&P index announcement of this kind: people buy the news. The importance of index inclusion is obvious: fund managers who want to match S&P index performance tend to have to follow the new component by buying shares of it, which is an automatic lift.

In addition, there’s a PR element. Merrill Lynch analyst Koji Ikeda, on Monday articulated why announcements of this kind tend to be seen as favorable. “Now that it's going to be a part of the S&P 500, we believe investor awareness of this DevSecOps category leader will increase meaningfully,” writes Ikeda, referring to the software category into which Datadog is usually included, “DevSecOps.”

That makes sense, as DevSecOps is rather obscure, so index inclusion can tend to shine a light.

I was curious to know just how much index inclusion actually helps a stock, so I did a little research.

Adobe is one of the most interesting stock debates these days, given that it is a storied name, and given that the debate about its future hinges for the moment on what people think about artificial intelligence.

As I’ve noted before, the discussion is about whether Adobe can thrive, or even survive, as non-professional types — hobbyists, people who are amateurs at design, and lots of others who are not the “core audience” — are lured away by AI tools such as ChatGPT making their image for them.

Last month, Adobe’s quarterly report was deemed very “solid” by most analysts, but it hasn’t helped the shares much, with the stock down ten percent since then, at $377.36, a fifteen-percent decline so far this year.

On Wednesday, a skeptic turned more negative, as Omar Sheikh of Rothschild & Co.’s Redburn division cut his rating on the stock to Sell from Neutral, and slashed his price target to $280 from $420.

What is the Street doing during these summer months?

They’re driving around the country looking at artificial intelligence data centers for tea leaves.

Macquarie Research’s Paul Golding, an analyst covering payments technology, including crypto-currency, lead clients on a bus tour through Texas last week, meeting with crypto firms such as Hut 8, Riot, Galaxy Digital, and a twelve-year-old, privately held firm named Aligned Data Centers based in Danbury, Connecticut.

The connection of AI to crypto is that a lot of companies that were mining Bitcoin for years suddenly turned to AI to fill their data centers as mining demand cooled.

Hut 8 and Riot and Galaxy, and others such as Cleanspark, are selling their data center capacity to parties hungry for ever more racks of equipment to run GPU chips for AI.

That includes large deals by CoreWeave lately to rent capacity from Cleanspark, Applied Digital, and Core Scientific that made headlines.

Stocks are hitting new highs. The week ending June 27th saw several of the biggest names at new highs on Friday, including Broadcom, Cisco, Taiwan Semiconductor, Microsoft, Intuit, Uber.

It’s very broad-based, with a ton of other names were hitting new highs: Advanced Energy Industries, SK Hynix, Aeva Technologies, Amphenol, Booking Holdings, Celestica, DoorDash, Diebold, Flex, Jabil, Just Eat Takeaway, Cloudflare, Roblox, Sanmina, Rocket Lab, Spotify, Seagate, Zscaler, etc.

Reasons include the tariff pause put in place by U.S. president Donald Trump restored risk-on attitude, and there was a relatively benign earnings season, with just a couple of tariff-related warnings from Ciena, First Solar.

You can debate the virtues of Bitcoin, but it’s certainly been the case that the crypto-currency has been a better bet than the companies working on crypto, companies such as Argo Blockchain.

Back in February of 2022, I wrote a note about Argo and others that were in that group of “blockchain” exchanges, crypto mining facilities, data center providers, etc. Their stocks were already down at the time, but they’ve turned out in the intervening three-plus years.

While Bitcoin has more than doubled since February of ’22, to a recent $107,266 per coin, Argo’s shares in that time have lost ninety-eight percent of their value. Bitfarms, another hopeful, is down almost eighty percent in three years. Many have trailed the Nasdaq Composite’s fifty-five percent return, such as Cleanspark, up just twenty-eight percent. 

Just a couple have been good bets, including Coinbase, the largest crypto exchange, up eighty percent since 2022, and Galaxy Digital, the firm run by former Fortress Investment principal Mike Novogratz, whose shares are up seventy-six percent. 

Most of the best action of late has been in the crypto ETFs, not stocks.

However, hope springs eternal, and Circle Internet Group, which went public on June 5th in an offering lead by JP Morgan, Citigroup, and Goldman Sachs, has more than doubled to a recent $182.56. 

The stock received mix reviews Monday as several underwriters and other analysts initiated coverage of its shares. The dilemma for analysts is simple: Lots of potential, hugely expensive stock.

As I had previewed in this week’s podcast, there was a rising tide of good feeling about memory-chip maker Micron Technology heading into Wednesday evening’s report, and it was paid off with what is being described as a “stellar” or “blow-out” report.

It wasn’t enough for the shares, however, which are up forty-five percent this year, and which have more than doubled since hitting a fifty-two-week low in April. The stock sold off a point on Thursday to $126.

The issues, if there are any, are probably less profound than the opportunity.

The results for the fiscal third quarter were strong all around. The quarter’s revenue and profit were the strongest upside in five and four quarters, respectively, and the forecast for revenue and profit were both the strongest in five quarters.

In these summer weeks between earnings reports and tariff cliffs, the Street turns to its current obsessions, things such as artificial intelligence agents and stablecoins.

An emerging fixation of the Street is the notion that “agents,” AI programs that plug into databases and other existing programs, will help companies better monetize AI.

Merrill Lynch’s software analyst Brad Sills on Tuesday took a shot at sizing the market for agents, which he concludes could be a “compelling” $155 billion total addressable market (TAM) by 2030.

“To our knowledge, this would make our estimated 2030 TAM the Street/third-party research high, and by a significant margin,” he writes. Other figures he’s seen from firms such as Boston Consulting Group, in the neighborhood of $52 billion, “are definitely too low,” he avers.

Elon Musk on Monday introduced a few of Tesla’s robo-taxis to Austin, Texas, a maiden voyage that has been anticipated since last fall’s unveiling of the self-driving technology.

The rides were offered to select “influencers,” according to Reuters’s Norihiko Shirouzu and Abhirup Roy, and the whole experiment involves “a small trial with about 10 vehicles and front-seat riders acting as ‘safety monitors’,” they relate.

The response from the Street is rather muted, and it’s clear there are many more fans of Google’s Waymo service than of Musk’s company.

Ben Rose of the boutique Battleroad Research estimates that Waymo is already making a quarter of a billion dollars in annual revenue on millions of self-driving rides in multiple markets. Google is probably also losing hundreds of millions of dollars on the service, he estimates, which shows you the power of being able to subsidize such a project.

Welcome back from the U.S. Juneteenth Holiday weekend. 

Stocks continue to make gains through Friday's close, June 20th, with the Nasdaq Composite Index closing the week up fractionally. 

The Nasdaq is now up 2% for the month of June so far, the Standard and Poor’s 500 Index up 1%. The TL20 group of stocks to consider is up 6% for the month. 

Both indices are up slightly, year to date, building on May's big gains.

Welcome to a quiet summer Friday of a holiday week, when yours truly seeks to catch up on some missed coverage of stocks earlier in the week.

First stop, a large initiation of coverage on chip equipment stocks, which have been very mixed this year, the group roughly flat. As you can see in the table, most are pretty far from their fifty-two week high prices, so the group has been generally out of favor.

David Dai of Bernstein Research on Monday took a fresh look at the matter and came up with what I think is an intriguing contrarian view: Dump ASML, buy BE Semiconductor.

Dai appreciates the strengths of both companies (both of which are in the TL20 group of stocks to consider), but he’s focused on what happens to two great franchises as we move out in time.

He thinks ASML becomes less important than it is now, and BE more so. He starts ASML at Neutral and BE Semi at Outperform.

Sometimes the zeitgeist wins out over feelings about individual stocks.

Shares of chip-maker Marvell Technology have been a dog for a while now, down thirty-two percent this year at a recent $75.47, and up just three percent in twelve months, as quarterly results have failed to show the kind of upside that investors wanted.

But all is forgiven this week as the company Tuesday gathered analysts for an upbeat discussion of “AI infrastructure,” chips for running artificial intelligence.

The analysts came away delighted, and the zeitgeist of the AI-chip trade is now working in the shares’ favor: the stock is up Wednesday by seven percent, bringing gains for the week so far to almost twelve percent.

Marvell, you may recall, competes with Broadcom in helping the tech giants make custom chips for AI, known as “ASICs,” with Amazon being its most prominent customer. 

Well, that was quick: I interviewed Fastly CEO Todd Nightingale last month, and late yesterday it was announced that he’s departing to become chief operating officer of Arista Networks. In his stead, Fastly’s head of products, Kip Compton, is taking over as CEO. 

This often happens to reporters: They get played, in a sense, when an executive has a big change coming up and is seeking to build momentum by making media appearances. Oh, well, live and learn!

Nightingale replaces Anshul Sadana, who left Arista a year ago after eighteen years at the company. 

Investors seem to hate both of these new appointments, bidding down Arista by almost five percent today, to $90.83, and bidding down Fastly by almost nine percent, to $6.60. 

The analysts covering the stocks seem to be more content with the switch. 

I tend not to write about healthcare or biotech names because I don’t have a background in health or life sciences, and I believe the factors that drive those companies and their stocks are very different from those that drive areas such as computer networking and semiconductors, where I’ve spent over thirty years reporting.

However, I need to make accommodations more and more as technology seeps into every field and every industry. And some of the tech analysts I regularly follow are themselves expanding their coverage into life sciences for the right names.

Case in point, my curiosity was peaked with the initiation of coverage Monday of newly public Hinge Health, an eleven-year-old startup in San Francisco that claims to be changing the nature of outpatient care using artificial intelligence.

The appeal of the stock for many is that it is a kind of software stock, but trading at a cheaper valuation despite high growth at the moment.

Everything was “solid” for Adobe in Thursday evening’s fiscal second-quarter earnings report — that’s the term all the analysts used.

But solid results are not convincing anyone who has been worried about Adobe’s future. The stock fell five percent on Friday, the third quarter in a row that the shares have declined on the report. Adobe is down fifteen percent in the past twelve months. And the three-year, annualized return is a paltry three percent.

As I explained in this week’s podcast, the Street is concerned with whether creative professionals, those who grew up on Photoshop and the rest, are enough to offset what is expected to be a gradual migration away from Adobe of the less-dedicated users to artificial intelligence tools, things such as ChatGPT.

The question seems to be whether Adobe’s power in the visual creation market will be eroded by AI.