NEWS
Analyst Note Knocks Down Tech

Source: Tenor

Analysts at TD Cowen are back and raising additional warnings about Microsoft’s AI investments and the sustainability of the industry’s breakneck growth rate. Plus, Trump implemented new tariffs that sent automobile stocks tumbling. Defensive market sectors led as investors look to protect their books into quarter end. 👀 

Today’s issue covers the latest concerns surrounding Microsoft and Nvidia, Trump’s tariffs tanking the auto sector, and other pops and drops. 📰

Here’s the S&P 500 heatmap. 5 of 11 sectors closed green, with consumer staples (+1.55%) leading and technology (-2.23%) lagging.

Source: Finviz

And here are the closing prices: 

STOCKS
Pessimism Around The Pace Of AI Investment 🤔 

TD Cowen is back in the news after the company’s analysts noted that their channel checks at Nvidia’s (NVDA) GTC event and DCD Connect indicate aggregate data center demand has risen YoY, but not at the same pace as expected. 📉 

More specifically, it flagged “more pervasive lease cancellations and deferrals by Microsoft than initially thought.”

Its report suggests that Microsoft has walked away from new data center projects in the U.S. and Europe that would have amounted to a capacity of about 2 gigawatts of electricity. The analysts attributed the pullback to an oversupply of the clusters of computers that power artificial intelligence. ⚠️ 

The same analyst team rattled investors with a note back in February with similar concerns, which led Microsoft to comment that it was not changing its capital expenditure budget, but could potentially reallocate portions of it.

Today’s news hit most of the tech sector pretty hard, including digital infrastructure stocks like Vertiv Corp., energy infrastructure stocks like Oklo, and quantum computing stocks like IONQ.

Adding insult to injury, Nvidia shares fell on a Financial Times report that suggested China’s environmental regulations could impact the chipmaker’s AI sales in the country.

Overall, it was a tough day for the market between this tech news and the new automobile tariffs. Bears pushed the major indexes back below their 200-day moving average, and Nvidia lost hundreds of billions in market cap. 🐻 

Source: Stocktwits

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STOCKS
Other Noteworthy Pops & Drops 📋️ 

Lumen Technologies ($LUMN -6%): A Bloomberg report said that AT&T has been in exclusive discussions to acquire Lumen’s consumer fiber operations in a deal worth more than $5.5 billion, quelling any hopes of a higher bid for the assets coming in.

Allurion Technologies ($ALUR -3%): The weight loss company’s fourth-quarter loss exceeded estimates, and its 2025 revenue outlook disappointed investors.

REX American Resources (REX +5%): The ethanol producer’s fourth-quarter results topped estimates, with net sales falling 15% YoY, primarily due to a decrease in lower product pricing. Despite the weaker environment, it’s still planning a major expansion.

Alphabet ($GOOGL -3%): YouTube took the lead in Nielsen’s February 2025 Media Distribution Gauge, improving 2% MoM and capturing 11.6% of time spent watching TV across the month. That’s up from 7.9% in February 2023.

Bayer ($BAYRY -4%): The German pharmaceutical maker entered into a global license agreement with China’s Suzhou Puhe BioPharma Co. for its oral drug candidate targeting cancer cells. It obtained a worldwide license to develop, manufacture, and commercialize the experimental drug, which is not approved by any health authorities.

Paychex ($PAYX +4%): The human resources tech and advisory service company’s results narrowly topped estimates, but sentiment remains ‘extremely bearish.’

Southern Copper & Freeport McMoRan ($SCCO & $FCX -4%): Copper mining stocks fell after a Bloomberg report suggested that U.S. tariffs on copper imports could be implemented sooner than expected. Copper futures hit a new cycle high.

Cintas ($CTAS +5%): The corporate apparel and office supply company’s revenues rose 8.4% YoY and net income jumped 16.6% YoY as it topped analyst estimates.

Playtika Holding Corp. ($PLTK +20%): Bank of America double upgraded the mobile game developer from ‘Underperform’ to ‘Buy’ and raising its price target from $6 to $6.50. The analysts say the company has the highest industry profitability and three of the longest-running mobile gaming franchises.

Palo Alto Networks ($PANW -3%): The cybersecurity giant announced that it signed a multi-year partnership with the National Hockey League (NHL).

SurgePays, Inc. ($SURG +68%): The telecom and fintech nano-cap company issued an upbeat outlook that offset its subpar annual results.

Quantum BioPharma ($QNTM +18%): Its licensee, Celly Nutrition Corporation, has released a new format of its alcohol detox product that could be sold in convenience, liquor, and drug stores across the United States.

BlackRock ($BLK -1%): The world’s largest asset manager launched a first-of-its-kind customizable model portfolio with access to private and public market assets.

Trimble ($TRMB -5%): The company has been given 60 days to submit a plan to regain compliance, with the possibility of an extension up to 180 days, for failing to file its Annual Report on Form 10-K for the fiscal year that ended on Jan. 3, 2025.

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POLICY
Fresh Tariffs Weigh On Auto Stocks 🚘️ 

U.S. President Donald Trump announced that new import taxes of 25% on cars and car parts are coming into the U.S., furthering the global trade war. The latest tariffs will go into effect on April 2nd, when additional ‘reciprocal tariffs’ on countries like Mexico, Canada, and others are also expected. ⚔️ 

The U.S. imported roughly eight million cars last year, accounting for about $240 billion in trade and roughly half of overall sales. Mexico is also the top supplier of cars to the U.S., with U.S. car companies having operations there and in Canada.

The news has shares of Ford, General Motors, Stellantis, and other automobile stocks extending their regular session declines in after-hours trading. With Trump signaling that these measures are permanent, the only clear way for automakers to avoid them is to build their car in the U.S.

That will not be an easy (or quick) fix. 😐️ 

Source: Stocktwits Trending Tab

WHAT’S ON DECK
Tomorrow’s Top Things 📋

Economic data: GDP Growth Rate Final Q4 (8:30 am), Initial/Continuing Jobless Claims (8:30 am), Retail/Wholesale Inventories (8:30 am), Pending Home Sales (10 am), Fed Barkin Speech (4:30 pm). 📊

Pre-Market Earnings: Bitfarms ($BITF), Urban One ($UONE), Jiayin Group ($JFIN), Urban One ($UONEK), Winnebago Industries ($WGO). 🛏️

After-Hour Earnings: Lululemon ($LULU), Co-Diagnostics ($CODX), Plus Therapeutics ($PSTV), KULR Tech ($KULR), The Beachbody Company ($BODI), Goevax ($GOVX). 🎧

P.S. You can listen to all of these earnings calls and more straight from the Stocktwits app or website. You’ll find them on the calendar page and individual symbol pages once they’re set to begin! We’ll see you there. 👍

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