The stock retreated in another choppy, holiday-shortened week, with the Nasdaq heading for its first close below the 50-day line in four months. Treasury yields surged to a 52-week high on a hot jobs report.
Nvidia CEO Jensen Huang gave a much-anticipated CES 2025 speech, but shares tumbled back afterward. Nvidia chipmaker Taiwan Semiconductor reported strong sales and Delta Air Lines better-than-expected earnings and guidance. Tesla launched the long-awaited Model Y refresh. Meta Platforms ended its fact-checking efforts and named UFC CEO Dana White, a Donald Trump supporter, to its board.
Stock Market Breaks Key Levels
The major indexes started the week strong, but then fell back for solid weekly losses. The S&P 500 gained and quickly lost the 50-day line while the Nasdaq finally fell below that level. Nvidia tumbled after CEO Jensen Huang's CES speech, while quantum computing and other highly speculative stocks sold off. Treasury yields rose to a 52-week high.
Hot Jobs Report Ices Rate-Cut Hopes
Friday's jobs report looked like a game-changer. Hiring blew away expectations and the unemployment rate unexpectedly dipped. Yet, if you take a step back, it still looks pretty mediocre. Despite December's 256,000 payroll gain, including 223,000 private-sector jobs, the three-month average gain is a moderate 170,000, with 138,000 private jobs. December's strength may have reflected delayed recovery after a lackluster November bounce from October's anemic hiring amid storms and the Boeing strike. Business optimism tied to President-elect Donald Trump's low-tax agenda also may have given hiring a lift. However, it's too soon to know whether any short-term burst has staying power. Plus, gains weren't broad-based, as factories shed jobs and construction hiring was modest.
Nvidia's Huang Sees Huge AI Future
Nvidia CEO Jensen Huang, speaking at CES 2025, touted huge opportunities for generative artificial intelligence across a range of industries. He unveiled Nvidia Cosmos, AI for the physical world such as robotics and self-driving. Uber and self-driving truck company Aurora will use the system. Those were among many partnerships as Nvidia aims to defend its competitive moat. Project DIGITS will offer $3,000 AI supercomputers. Huang also said Blackwell shipments are going well and introduced new gaming chips. Meanwhile, The Biden administration reportedly plans to step up export curbs on AI chips from Nvidia and Advanced Micro Devices. Nvidia stock, which had run up ahead of his speech, tumbled from a record high to below key levels.
Quantum computing stocks such as IonQ and Rigetti crashed Wednesday after Nvidia's Huang predicted quantum computing won't be "very useful" for 15-30 years.
Stock Market Breaks Key Support; What To Do Now
Taiwan Semiconductor Sales
Taiwan Semiconductor reported December sales surged 57.8% vs. a year earlier in local currency, amid booming AI demand. That was modestly above expectations. Q4 revenue climbed 39%, with Q4 earnings due Jan. 16. Taiwan Semi is the world's largest foundry, making chips for Nvidia, Broadcom, Apple and many more. Shares tested but held a buy point Friday.
Tesla Launches New Model Y
Tesla on Friday launched the refreshed Model Y vehicle in China with a slightly longer range and higher price than the old Model Y. The "Juniper" Model Y has a clearly different front and back. Deliveries of the new Model Y are due to start in March, with Europe and the U.S. likely coming soon after. Earlier, the National Highway Traffic Safety Administration opened an investigation into Tesla crashes involving the Actually Smart Summon feature. TSLA shares fell solidly for the week, testing a rising 10-week line.
Delta Flies On Earnings, Guidance
Delta Air Lines on Friday reported a 44.5% earnings gain while revenue increased almost 10% to $15.56 billion, both beating forecasts. Delta guided higher on Q1 and 2025, while forecasting 10% earnings growth over the next three to five years. DAL stock surged Friday, hitting a record high.
Meta Shifts Policies, Partners With eBay
Meta Platforms Chief Executive Mark Zuckerberg said that the social media giant is phasing out its fact-checking operations and will begin placing political content back into algorithmic recommendation feeds on Facebook, Instagram and Threads. The move was widely seen as an attempt to ease tensions with President-Elect Donald Trump, who has accused Meta's fact-checking operation of harboring a bias against conservative content. Meanwhile, Meta announced that it would soon include eBay listings on Facebook Marketplace in Germany, France and the U.S. The move was made as a concession to European regulators who late last year fined Meta $840 million, saying Facebook Marketplace violated competition rules. EBay stock jumped 10% on the news. Meta stock was up slightly for the week entering Friday.
In Brief
Constellation Energy will buy Calpine, a natural gas and geothermal power generator, in a cash-and-stock deal valued at $26.6 billion, including $12.7 billion in assumed debt. CEG stock surged Friday to a record high.
Fanduel-parent Flutter Entertainment cut its 2024 U.S. revenue projections as the NFL season to date "has been the most customer friendly since the launch of online sports betting with the highest rate of favorites winning in nearly 20 years." Flutter Entertainment now expects U.S. sales of $5.78 billion vs. its prior guidance $6.05 – $6.25 billion. But outside the U.S., Flutter reported "favorable sports results" in the English Premier League. It estimates 2024 revenue and adjusted EBITDA will be 1%-2% higher than the midpoints of its previous guidance.
Cal-Maine earnings boomed to $4.47 per share from 35 cents a year ago. Revenue surged 82% to $954.7 million, accelerating from a 71% gain the prior quarter. The company cited robust demand, while prices skyrocketed as bird flu outbreaks crimped supplies. Cal-Maine said it is investing $60 million to expand cage-free egg capacity, as it continues to play catch up with upstart Vital Farms, an organic egg producer. Shares of both companies ripped higher in the past year. Cal-Maine stock briefly surged on earnings, then pared gains. Vital Farms is near a buy point.
Boston Scientific announced a $4.9 billion takeover of Bolt Medical. Meanwhile, Johnson & Johnson said it temporarily halted sales of its Varipulse system. Several patients experienced side effects following treatment with the pulsed field ablation system. Boston Scientific sells a rival system, Faripulse. BSX stock gapped to a new high.
