A Quantum Computing Crash
NEWS
A Quantum Computing Crash
Source: Tenor.com
Quantum computing stocks plunged across the board after Nvidia’s CEO said practical use of the technology is still decades away. Meanwhile, the December Fed minutes flagged uncertainty caused by President-elect Trump’s policies, hinting at slower rate cuts and a more mixed message from the central bank. 👀
Today’s issue covers Jensen Huang’s comments crushing quantum stocks, Constellation Energy buying a competitor, and more from the day. 📰
Here’s the S&P 500 heatmap. 8 of 11 sectors closed green, with materials (+0.55%) leading and communication services (-0.59%) lagging.
Source: Finviz.com
And here are the closing prices:
|
S&P 500 |
5,918 |
+0.16% |
|
Nasdaq |
19,479 |
-0.06% |
|
Russell 2000 |
2,239 |
-0.48% |
|
Dow Jones |
42,635 |
+0.25% |
Most bullish/bearish symbols on Stocktwits at the close: 📈 $JSPR, $XHG, $PENG, $SCCO, $KMDA 📉 $AVDL, $VIR, $DRIO, $ALLY, $HELE*
*If you’re a business and want to access this data via our API, email us.
STOCKS
Jensen Huang Casts Doubts On Quantum Computing 😬
Quantum computing stocks have been all the rage lately, seen as the next leg of the artificial intelligence (AI) and broader technology rally. However, the recent rally has been stopped in its tracks following comments from Nvidia CEO Jensen Huang during the company’s Analyst Day. 🛑
Evercore ISI analyst Mark Lipacis asked about Nvidia’s strategy for quantum computing and how quantum computing differs from the accelerated computing platforms Nividia has. According to the event transcript, Huang replied:
His comments echo the findings of Boston Consulting Group, the management consultancy firm that suggested the quantum computing industry will grow through three phases, achieving full-scale fault tolerance likely after 2040. ⏳️
Quantum Computing stocks like D-Wave Quantum, Quantum Computing, Inc., IonQ, Rigetti Computing, Arquit Quantum, and others all declined significantly today, with many posting losses in the 30-50% range.
Following the selloff, a new poll on Stocktwits shows mixed sentiment among retail investors and traders toward the industry. Roughly 44% of the 8,100 respondents remain bullish long-term, with a third agreeing that it’s too early, and the remaining trading the swings or avoiding the stocks entirely. 😬
Source: Stocktwits.com
On top of the tech stock pessimism, the December Fed Minutes raised further concerns about the path of interest rates. The Wall Street Journal’s Nick Timiraos flagged the following quote in his recap story:
“Recent higher-than-expected readings on inflation, and the effects of potential changes in trade and immigration policy, suggested that the process [of bringing inflation to target] could take longer than previously estimated.”
Time will tell what the fate of quantum computing stocks is. But in a high interest rate environment, the growth trajectory and price investors are willing to pay for these types of long-term, speculative bets both face meaningful headwinds.
PRESENTED BY STOCKTWITS
Mastering Risk Management With @alphatrends 🛡️
Pro trader and Stocktwits user Brian Shannon is back for another power hour, focusing on managing risk in this choppy market environment. He analyzes several key indices and high-beta stocks using the anchored VWAP and outlines levels of interest, how he manages trades, common pitfalls in “buying the dip,” and more!
STOCKS
Other Noteworthy Pops & Drops 📋️
DatChat (-60%): The company capitalized on its recent stock surge by announcing securities purchase agreements with institutional investors to sell an aggregate of 1.2 million shares at a purchase price of $4.25 per share.
MultiSensor AI (-31%): Amid a strategic shift, it appointed its chief financial officer (CFO), Peter Baird, as its chief commercial officer. Baird will focus on driving the company’s sales initiatives and building commercial partnerships.
Galapagos NV (+2%): The Belgium-based biotech announced a significant restructuring plan, including a spin-off into two publicly traded entities and a major workforce reduction.
Context Therapeutics (+14%): JMP Securities initiated coverage with an ‘Outperform’ rating and a price target of $4, implying nearly 300% upside.
First Solar (-3%): Wells Fargo lowered its price target on the shares to $209 from $240 while maintaining an ‘Overweight’ rating. The brokerage expressed a bearish outlook for the clean energy sector in 2025, citing ongoing political uncertainty surrounding the Inflation Reduction Act (IRA) and elevated interest rates.
Exxon Mobil (-2%): In a regulatory filing, the oil major said that its upstream segment earnings in the fourth quarter could decline by $500 million to $900 million from the preceding quarter due to a fall in liquids prices.
Lyft (-6%): Delta Air Lines announced that Uber will be the airline’s exclusive rideshare and delivery partner in the U.S. beginning this spring, replacing Lyft.
Advanced Micro Devices (-5%): HSBC analysts double-downgraded the stock to ‘Reduce’ from ‘Buy,’ slashing their price target from $200 to $110.
UniFirst Corporation (+5%): The supplier and servicer of uniform and workwear programs, facility service products, and first aid and safety supplies beat on earnings.
Arcadium Lithium (+8%): The Committee on Foreign Investment in the United States (CFIUS) approved its acquisition by Rio Tinto (RIO). CFIUS completed its review of the deal, concluding there were no unresolved national security concerns.
Sana Biotechnology (+170%): Analysts reacted positively to initial data from a groundbreaking type 1 diabetes trial using Sana’s experimental cell therapy.
N2Off Inc. (+23%): The company received a 180-day extension from the Nasdaq to regain compliance with the exchange’s listing requirements.
SoundHound AI (-16%): It was a “buy-the-rumor, sell-the-news event” after the voice and conversational artificial intelligence (AI) solutions provider unveiled its much-awaited first-ever commerce platform at the Consumer Electronics Show (CES) 2025.
Moderna (-9%): Retail sentiment remains ‘extremely bullish,’ even as the stock pairs some of its gains from this week’s H5N1 bird flu vaccine optimism.
COMPANY NEWS
Constellation Energy Comes For Its Competitor 👀
The power generation sector may be seeing one of its biggest-ever deals begin to unfold as Constellation Energy Corp. nears an acquisition of Calpine Corp.
The energy giant is reportedly in discussions with Calpine’s private equity owners to organize a transaction that could value the company at about $30 billion, including debt. Calpine was taken private in 2017 in a deal valued at roughly $17 billion. It now generates electricity from natural gas and geothermal resources to power roughly 27 million homes annually. ⚡️
As for Constellation, the deal would help diversify its fleet of plants by geography and fuel type, with Capline’s weighting toward natural gas offsetting its concentrated portfolio of nuclear assets.
According to Grid Strategies, skyrocketing power needs to run data centers, new factories, and other facilities will drive U.S. electricity demand higher by 16% over the next five years. And retail investors and traders are seemingly buying that thesis. 💵
A Stocktwits poll showed that roughly 58% of the 1,500 respondents view nuclear energy stocks as a “top-performing sector” for 2025. Constellation Energy shares initially fell 5% on the news, but Stocktwits sentiment remained in ‘bullish territory’ by the close of trading. 🐂
Source: Stocktwits.com
As a result, this stock will likely remain on traders’ and investors’ radars until the deal is formally announced and provides more clarity about the long-term potential. 🧭
Links That Don’t Suck 🌐
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💰️ Trump announces Dubai company will invest at least $20 billion in U.S. data centers
🤖 CES 2025 updates: Live coverage of all the biggest tech, AI and gadget news from Las Vegas
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