While the NASDAQ is flirting with putting a double-top in, technology companies like 
MSFT 
GOOGL and 
META are increasing CapEx spend for future Ai infrastructure. Margin compression is likely to result with a smaller hit from energy costs - estimated at about 1% of revenue - as energy demand for compute continues to leap forward and future executive action from the Trump administration threatens to kneecap the ITC with modified "placed-in-service" dates and onerous FEOC requirements, eliminating targeted tax subsidies on solar and redistributing the costs to energy more broadly. META will not likely see the benefits of its CapEx spend anytime soon.
The ratio continues to widen between the
NDX and 
SPY, indicating a higher probability of mean-reverting behavior. While QE and open-market operations have tended to be steepening for technology companies after the dotcom bust and beginning during the GFC, the segment is likely exhausted. We have not yet seen a larger retrace since unprecedented yield inversions starting in '22.
If we see a large market correction, a markdown in share price and any drop in advertising - META's largest revenue driver - will likely compound bearish sentiment. Tariff effects have yet to reported meaningfully in economic data and the job market is cooling. Inflation is likely to stick at 3%. Stagflation is on the table.
What a time to be alive.
~s
MSFT GOOGL and META are increasing CapEx spend for future Ai infrastructure. Margin compression is likely to result with a smaller hit from energy costs - estimated at about 1% of revenue - as energy demand for compute continues to leap forward and future executive action from the Trump administration threatens to kneecap the ITC with modified "placed-in-service" dates and onerous FEOC requirements, eliminating targeted tax subsidies on solar and redistributing the costs to energy more broadly. META will not likely see the benefits of its CapEx spend anytime soon. The ratio continues to widen between the
NDX and SPY, indicating a higher probability of mean-reverting behavior. While QE and open-market operations have tended to be steepening for technology companies after the dotcom bust and beginning during the GFC, the segment is likely exhausted. We have not yet seen a larger retrace since unprecedented yield inversions starting in '22.If we see a large market correction, a markdown in share price and any drop in advertising - META's largest revenue driver - will likely compound bearish sentiment. Tariff effects have yet to reported meaningfully in economic data and the job market is cooling. Inflation is likely to stick at 3%. Stagflation is on the table.
What a time to be alive.
~s
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.