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Smashing idea: how East Germany invented ‘unbreakable’ drinking glasses 2024-08-06 16:26:00+00:00 - The glass is narrow at the bottom but bulges out a third of the way to the top. As with the classic British “nonik” pint, the bulge makes the glass easier to stack and gives your thumb and index finger somewhere to rest. The name is spelled in fading letters near the rim and means “super tight” or “super strong” in German, which one might assume to be a reference to the drinker’s solid grip. In fact, it hails the glass’s extraordinary durability. This is Superfest, East Germany’s “unbreakable” drinking glass. Invented in the industry-rich but resource-poor socialist German Democratic Republic, Superfest glasses were designed with the aim of making them last five times longer than ordinary drinking glasses. They were soon found to be 10 times more durable. Glass retailers depend on their products breaking – this new idea was a threat to profits The company that made them went bankrupt after the fall of the Berlin Wall, but as contemporary designers are exploring more eco-friendly and sustainable production methods, the 120m Superfest glasses produced between 1980 and 1990 are more in demand than ever, fetching about €35 (£30) a pop on online marketplaces such as eBay and Etsy. Some designers even dream of bringing the technology behind them back into production. As objects mostly made to be seen through rather than seen, drinking glasses are an oddly overlooked category of homeware design. Even when they are recognised as works of art, their value tends to be set by what goes in them. A Kurt Zalto wine glass or a Tom Dixon whisky tumbler will fetch good money at auctions; the humble water glass usually doesn’t. In the case of the Superfest glass, the anonymity of the makers was also politically desired. The GDR’s regime preached solidarity and unity. The prevailing ideology regarded the collective more highly than the talents and abilities of the individual. Even though Superfest glasses were ubiquitous in every bar, canteen and household in the Soviet satellite state, few people had heard of Paul Bittner, Fritz Keuchel and Tilo Poitz, the design collective who gave them their shape. “Not a living soul had any idea who actually designed Superfest,” says Günter Höhne, who from 1984-1989, in the GDR’s twilight years, worked as editor-in-chief for the country’s leading journal for industrial design, Form und Zweck. For their range of glasses – which included variants for champagne, schnapps and cognac as well as three different sizes for beer – the designer trio were inspired by the equally beautiful so-called Wirteglas, which the East German designers Margarete Jahny and Erich Müller created in the early 1970s. The groundbreaking technology they deployed was developed in the 1970s at the Department for Glass Structure Research at the Central Institute for Inorganic Chemistry near Dresden. The material scientists there knew that when glass breaks, it is typically due to microscopic cracks in the material’s surface which form during the production process. Dramatically increasing the toughness of the glass surface was possible, they found, by replacing the smaller sodium ions in the glass with electronically charged potassium ions. Potassium ions need more space, pressing harder against neighbouring atoms and building up more tension that needs to be overcome for the microscopic cracks to get bigger. “A huge amount of technical groundwork was done to produce a glass like that,” says Höhne, who is the author of several books about industrial design in the GDR. Nonetheless, the state-owned company that specialised in this technology, VEB Sachsenglas Schwepnitz, ceased production in 1990, a year after the fall of the Berlin Wall. Hundreds of employees received redundancy notices, and scrap dealers came to pick up melting moulds, plant components and machines. View image in fullscreen ‘There’s only one disadvantage’ … Paul Kupfer, the Soulbottles co-founder bringing shatter-resistant glass back to market. Photograph: Courtesy: Soulbottles One factor that may have hindered Superfest’s competitiveness in a unified Germany was its functionalist, austere look. Especially in southern parts of the country, drinkers like to swig their beer from glasses decorated with gold edging or engraved coats of arms. “Baroque decoration on a Superfest glass wouldn’t work,” says Höhne. “It would violate the design itself.” But the main reason for its decline, paradoxically, was its strength. Glass retailers who play by the rules of the market live off the fact that their products break, so they can sell more. A glass that didn’t break was a threat to profits. “It turned out that Superfest is not suited for the market,” says Höhne. “The glasses are too good for pure market thinking.” Today, the highly durable glasses can only be bought secondhand – but a Berlin startup is trying to change that. As sustainability has risen up the agenda, the company Soulbottles believes customers are prepared to pay higher prices for high quality and durable products. Its founders, Paul Kupfer and Steve Köhler, have crowdfunded €251,139 (£215,400) for a production facility that partially draws on Superfest’s old GDR-era ion technology. “Compared to plastic, glass is a material that can be recycled almost as often as you like,” says Köhler. “It is tasteless and transparent, and it has only one disadvantage: it breaks.” The problem with the original Superfest glass is that its manufacturers worked with modified alumino or borosilicate glass, which is not as easy to recycle as the more common soda-lime glass. So Soulbottles’ challenge is to produce glass that is both durable and recyclable. Initial tests were promising, and delivery of the first bottles is expected next year. How strong are they? Well the prototypes were dropped from a height of two metres – and didn’t smash.

Elon Musk’s X sues advertisers over alleged ‘massive advertiser boycott’ after Twitter takeover 2024-08-06 16:22:13+00:00 - WICHITA FALLS, Tex. (AP) — Elon Musk’s social media platform X has sued a group of advertisers, alleging that a “massive advertiser boycott” deprived the company of billions of dollars in revenue and violated antitrust laws. The company formerly known as Twitter filed the lawsuit Tuesday in a federal court in Texas against the World Federation of Advertisers and member companies Unilever, Mars, CVS Health and Orsted. It accused the advertising group’s brand safety initiative, called the Global Alliance for Responsible Media, of helping to coordinate a pause in advertising after Musk bought Twitter for $44 billion in late 2022 and overhauled its staff and policies. Musk posted about the lawsuit on X on Tuesday, saying “now it is war” after two years of being nice and “getting nothing but empty words.” X CEO Linda Yaccarino said in a video announcement that the lawsuit stemmed in part from evidence uncovered by the U.S. House Judiciary Committee which she said showed a “group of companies organized a systematic illegal boycott” against X. The Republican-led committee had a hearing last month looking at whether current laws are “sufficient to deter anticompetitive collusion in online advertising.” The lawsuit’s allegations center on the early days of Musk’s Twitter takeover and not a more recent dispute with advertisers that came a year later. In November 2023, about a year after Musk bought the company, a number of advertisers began fleeing X over concerns about their ads showing up next to pro-Nazi content and hate speech on the site in general, with Musk inflaming tensions with his own posts endorsing an antisemitic conspiracy theory. Musk later said those fleeing advertisers were engaging in “blackmail” and, using a profanity, essentially told them to go away. The Belgium-based World Federation of Advertisers and representatives for CVS, Orsted, Mars and Unilever didn’t immediately respond to requests for comment Tuesday. A top Unilever executive testified at last month’s congressional hearing, defending the British consumer goods company’s practice of choosing to put ads on platforms that won’t harm its brand. “Unilever, and Unilever alone, controls our advertising spending,” said prepared written remarks by Herrish Patel, president of Unilever USA. “No platform has a right to our advertising dollar.”

Global markets partly recover but analysts fear ‘we’re not out of woods’ 2024-08-06 16:21:00+00:00 - Shares on Wall Street rose and many Asian and European markets staged a recovery after this week’s global stock market rout, but analysts warned: “We might not be out of the woods.” The FTSE 100 index in London rose 18 points, or 0.2%, on Tuesday to close at 8,026.69, after losing 166 points, or 2%, on Monday, its biggest one-day points drop in more than a year. Germany’s Dax edged up by 0.1%, although France’s Cac slipped by 0.3% after earlier rising, and the Italian bourse slid by 0.6%. On Wall Street, the Dow Jones closed up by 0.8%, while the broader S&P 500 rose by 1.5%. The Nasdaq climbed 1%, after Wall Street’s worst day in almost two years on Monday. The Nikkei 225 index in Tokyo closed 10.2% higher – up 3,217 to 34,675, a record daily points rise – as investors bought into bargains after the 12.4% rout the previous day that triggered a fall in European and US markets. The Nikkei experienced its biggest drop in 37 years on Monday. Other markets in Asia also recovered after the rollercoaster ride at the start of the week. South Korea’s Kospi index gained about 3%, while Australia’s ASX200 added 0.4% and the Shanghai and Shenzhen markets in China rose by 0.2% and 0.8% respectively. Hong Kong’s Hang Seng was among a small number of markets that recorded further modest losses, slipping by 0.3%. “We might not be out of the woods yet,” said Fawad Razaqzada, a market analyst at City Index, “though conditions could stabilise as the week progresses. With a quieter US economic calendar ahead, there will be fewer new recessionary signals to unsettle traders, and the potential for supportive comments from Federal Reserve officials could ease market pressure.” The dollar gained 0.7% to 144.75 yen, the first day it has traded higher against the Japanese currency this month. However, the dollar could weaken more broadly in the coming days and weeks amid expectations of a sharper pivot by the US Federal Reserve than previously expected, Razaqzada said. Markets are now expecting the Fed to cut interest rates by 50 basis points at its September meeting, with futures implying an 61% chance of such a big move. Analysts at Goldman Sachs, led by Peter Oppenheimer, said investors had been growing increasingly complacent, interpreting “bad news as good news”. They said: “Has the correction gone far enough? At this stage probably not. Valuations have moderated but remain elevated, particularly in the US.” The week started with a global stock plunge reminiscent of 1987’s Black Monday crash that swept around the world and pummelled Wall Street with more steep losses, as fears worsened about a slowing US economy. skip past newsletter promotion Sign up to Business Today Free daily newsletter Get set for the working day – we'll point you to all the business news and analysis you need every morning Enter your email address Sign up Privacy Notice: Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Privacy Policy . We use Google reCaptcha to protect our website and the Google Privacy Policy and Terms of Service apply. after newsletter promotion It was the first chance for traders in Tokyo to respond to the global sell-off that began on Friday, after US government figures showed employers slowed their hiring last month by much more than economists expected, while the unemployment rate rose to 4.3%. It was the latest piece of data on the US economy to come in weaker than expected, raising fears that the Fed has pressed the brakes on the economy by too much for too long through high interest rates, in the hope of bringing down inflation. Fed officials tried to reassure markets on Monday. Its San Francisco president, Mary Daly, said it was “extremely important” to prevent the labour market tipping into a downturn and that she expected interest rates to be cut later this year. Investors also pointed to the Bank of Japan’s decision last week to raise its main interest rate from almost zero. This helps boost the value of the Japanese yen but it could also force traders to exit deals where they borrowed money for virtually no cost in Japan and invested it in higher-yielding assets around the world. This is known as the “carry trade”. JP Morgan Chase said the recent unwinding in carry trades had further to run, as the yen remains one of the most undervalued currencies. “We are not done by any stretch,” Arindam Sandilya, a co-head of global FX strategy, said on Bloomberg TV. “The carry trade unwind, at least within the speculative investing community, is somewhere between 50% and 60% complete.”

Parisians once scoffed at hosting the Olympics. Now, here come the conga lines 2024-08-06 16:17:23+00:00 - Want more Olympics? Sign up for our daily Postcards from Paris newsletter. PARIS (AP) — Like most self-respecting Parisians, Mathilde Joannard and Franck Tallieu had been training for the Olympic sport of Olympics-bashing. Of course the Olympics were going to be a mess, the couple had reasoned when they learned the Games were coming to town. Like so many Parisians, the human resources executives assumed it would be crowded, or beastly hot, or chaotic, or a pain in the derrière to navigate. Or all the above. So how did they end up dressed in rented “Three Musketeers” costumes with painted-on goatees, waving the tricolor flag gleefully for the cameras at the fencing competition? They’re not really sure. “We just decided to have fun with it,” said Joannard, engaging in some Gallic understatement as the couple enjoyed ice cream pops outside the majestic Grand Palais during a break in fencing on a brilliant summer day. She herself seemed a bit shocked by what she was saying. “We’re really, really enjoying it,” she repeated. “I’m so glad we’re here.” It seems many Parisians have undergone the same happy metamorphosis. At first pooh-poohing the audacious plan to turn the capital into one big Olympic venue — launched by an even more audacious opening ceremony along the Seine River — many have come to think it was a pretty cool idea after all. And they’re taking it all in. Those who stayed, that is. As for those who left, some are sorry to have missed the fun. Where’s the evidence of fun, you ask? How about a conga line? At beach volleyball, in the absurdly photogenic stadium nestled under the Eiffel Tower, a crowd of volunteers began just such a line Sunday night. A gaggle of fans joined in, following them around an upper tier of the stadium. How about street dancing? The marquee cycling event a day earlier brought countless Parisians into the streets to cheer riders on, a mini-Tour de France showcasing the glittering capital. To the barricades, Parisians went — setting up speakers and dancing, even doing the wave with police officers at one spot. Sure, many international visitors were among them, replacing some of the residents who purposely left early on summer holiday. But there have been countless local fans, displaying French pride with painted flags on their cheeks as they flocked to favored events like judo, featuring French star Teddy Riner, and swimming, where France’s hero of these Games, Léon Marchand, was holding court. If you were around in 1998, you might have recalled a similar mood enveloping the city when France captured its first World Cup. For days afterward, briefcase-toting office workers rode the Metro with the tricolor on their cheeks. One could often hear spontaneous chants of “Et un, et deux, et trois-zéro” — a nod to the 3-0 score against Brazil in the final. So perhaps it wasn’t surprising that at fencing last weekend, the crowd suddenly launched into the very same chant. To one longtime Parisian, that didn’t sound like an accident — and not just because these Games have seen a stellar French performance, with the country’s medal haul currently third after the United States and China. “That 1998 World Cup was when we French realized we could be world champions,” said Dan-Antoine Blanc-Shapira, an event planner. “Maybe that’s also when we learned as a country that we could pull off something like this.” Blanc-Shapira stayed in Paris for much of the Games. He and his family went to watch women’s rugby and track events, and simply wandered the Champs-Elysées, delighted to see the smiling faces on the famous boulevard. “This may not be the real world right now, but it’s a very pleasant one,” he said. “Maybe we should do this more often.” Even some of those who’ve eschewed the often-pricey Olympic competitions — and many Parisians have indeed been priced out — say they’ve experienced an unexpectedly pleasant, even relaxed feeling in the city. “It’s unusually calm,” said writer Cathy Altman Nocquet. She chose not to attend Olympic events, but was delighted to stay in town. “It’s as if the entire city took a pill.” Others noted the contrast between the current mood and the tense atmosphere just weeks earlier, as the country went through elections and political turmoil. “This is such a nice distraction,” said Craig Matasick, a policy analyst who’s lived in Paris for 10 years. He and his family left for part of the Games because they thought things would be a mess, but found the city pleasant and much more relaxed than anticipated upon return. Matasick’s family of four has taken advantage of the offerings, visiting the Olympic cauldron in the Tuileries gardens, the Club France fan hangout, table tennis and cycling so far. “This vision of the city as backdrop for the Games could have been a total logistical nightmare,” Matasick noted, “but it hasn’t been.” Give Elodie Lalouette a medal — this Parisian had faith from the start. Lalouette, who works in communications for a national radio network, applied a year ago to be a volunteer. Now she’s taking two weeks’ annual leave to work at the field hockey venue. “I was sure it would be super,” she said during a break this week. “And it has — it’s been incredible.” Most valuable are the interactions she’s had with people from around the world. And, perhaps even more, with fellow Parisians. “They see me on the Metro, and they say ‘Salut’ and tell me it’s great that I’m doing this,” she said. Some who left have had regrets. Teacher Judith Levy surprised herself by watching the competition on TV nonstop for the first few days. Then she had to leave for Italy, a trip booked months in advance. “At the time, I felt like everything was going to go wrong,” she said of her travel plans. “Now I feel like I’m missing the party.” Claire Mathisjen, too, has watched it all from afar — on holiday in Brazil. The Paris-based psychologist lengthened her usual August holiday to avoid the Games. But watching for hours on TV, she has found herself transfixed. And while she isn’t necessarily consumed with regret, she does feel something else: pride. “I watched that opening ceremony and truly felt proud to be French, and a Parisian,” she said. “We pulled it off!” Jean-Pierre Salson would not dispute that. What he’s discovered, though, is that what’s good for the national soul may not be good for the bottom line. Salson, who owns a clothing store in the tourist-frequented Marais neighborhood, calculated just before the Games opened that business had tanked by 30-40% — a result of Parisians leaving and non-Olympics tourists staying away. He hoped things would improve after the opening ceremony, when security loosened. Contacted again, he said they had not. Tourists had already spent too much on tickets and such, and weren’t focused on clothes. Still, Salson will take no part in Olympics-bashing. “I have nothing bad to say, I think it’s great,” he said of his country’s successful Games. “But for business, I think we will have to wait.” He doesn’t have long to wait — the Olympics are closing in on their grand finale. For their part, Joannard and Tallieu, the temporary Musketeers, plan to keep enjoying events — including at the Paralympic Games. The couple are grateful now for a dinner they had sometime before the Games with a few American friends, which helped transform their attitudes. “We were doing the bashing,” says Tallieu. “But they were optimistic. You know what? They were right.” ___ Associated Press journalist Tom Nouvian contributed reporting. ___ For more coverage of the Paris Olympics, visit https://apnews.com/hub/2024-paris-olympic-games.

Microsoft Says Delta Was Largely Responsible for Flight Cancellations 2024-08-06 16:00:07+00:00 - In mid-July, a cybersecurity company, CrowdStrike, issued a flawed software update to customers who run Microsoft Windows, effectively shutting down various computer systems of lots of businesses, including several airlines. Most carriers bounced back relatively quickly, but Delta struggled for days, ultimately canceling about 5,000 flights over four days, or more than a third of its schedule. Delta’s chief executive, Ed Bastian, has said the episode had cost the airline about $500 million. Last week, he told employees that he had hired Mr. Boies’s firm, Boies Schiller Flexner, to pursue legal claims against Microsoft and CrowdStrike, which also rebutted Delta’s claims this week. In its letter on Tuesday, Mr. Cheffo said that Microsoft “empathizes” with Delta and its customers and that while the technology company was not at fault, it had offered to help the airline for no charge after the outage. Microsoft repeated that offer over five days, from July 19 to July 23, but was turned down each time, it said. The technology company’s chief executive, Satya Nadella, also reached out to Mr. Bastian on July 24 but never received a response, according to the letter. (In its letter, CrowdStrike said Delta had rejected or ignored its offers for help, too.) Microsoft said Delta had probably turned it down because the airline was struggling the most with a computer system that it uses to track and schedule the airline’s crew and that was being serviced by other companies, including IBM. It also accused Delta of using outdated information technology.

Hims & Hers Reports Stellar Quarter: Stock Set for a Rally 2024-08-06 15:07:00+00:00 - Most investors have had to worry about the accelerating sell-offs happening across the global stock markets this week, which aren’t being encouraged by news from Warren Buffett’s latest decisions. The Oracle decided to start decreasing its exposure to some of America’s technology darlings, such as Apple Inc. NASDAQ: AAPL, which was cut by 50%, or Bank of America Co. NYSE: BAC. Hims & Hers Health Today HIMS Hims & Hers Health $16.88 -0.96 (-5.38%) 52-Week Range $5.65 ▼ $25.74 Price Target $19.07 Add to Watchlist Even a few months ago, investors received a warning from Stanley Druckenmiller after he sold out of NVIDIA Co. NASDAQ: NVDA to reallocate into bonds and small-cap stocks. Some investors may have benefited from copying his liking of the iShares 20+ Year Treasury Bond ETF NASDAQ: TLT, but these have now become too famous a pick to follow up on. Get DexCom alerts: Sign Up What is still—arguably—undervalued and poised to rally in the coming months is a little-known healthcare stock called Hims & Hers Health Inc. NYSE: HIMS. Bringing the stability and predictability that come from investing in a defensive space like health care, along with the exciting and promising growth potential that technology offers, this company just proved to the market that an S&P 500 sell-off is nothing compared to the growth it delivered in its latest quarterly results. Hims & Hers Stock: Double-Digit Crash Turns Into Double-Digit Beat Over the past few weeks, bearish action has taken hold of Hims & Hers stock, but it has nothing to do with the company’s prospects at all. After posting disappointing demand guidance for its weight loss and diabetes watch medical devices, shares of DexCom Inc. NASDAQ: DXCM brought down all other stocks associated with weight loss products. The main difference is in the word devices; Hims & Hers doesn’t sell devices but instead sells medicine directly to aid in weight loss efforts. Secondly, according to its investor presentation, only one of ten product offerings must deal with weight loss. Not only is weight loss a minuscule share of the company’s revenue, but it was only introduced in December of 2023, so the impact could not have been as significant as to send the stock trading as low as 68% of its 52-week high. Here’s what the actual results look like in support of a potential recovery rally. Total subscribers grew 43% over the past 12 months for Hims & Hers. Subscriber growth is much different from monetizing these new members. Still, investors can rest assured that the company achieved this, as shown in the 52% jump in revenues over the year. All told, one of the most critical metrics in any business also jumped up by triple-digits this time. Free cash flow (operating cash flow minus capital expenditures) is up to $53.6 million, or 377% on the year, and that is one of the main milestones investors look for when finding their next multi-bagger investment. Hims & Hers Health, Inc. (HIMS) Price Chart for Tuesday, August, 6, 2024 Wall Street Sees Significant Upside Potential in Hims & Hers Stock Riding on this recent financial momentum, management felt comfortable guiding the rest of 2024 higher, and that is not only enough to send the stock into a recovery rally and makes it easier for Wall Street analysts to correctly value the stock today. Those at Truist Financial see a price target of up to $23 a share for Hims & Hers stock, daring it to rally by 29% from where it trades today. To support these targets, the general forecast for up to 90% earnings per share (EPS) growth in the next 12 months is the foundation for bullish sentiment. Hims & Hers Health Stock Forecast Today 12-Month Stock Price Forecast: $19.07 11.01% Upside Moderate Buy Based on 16 Analyst Ratings High Forecast $26.00 Average Forecast $19.07 Low Forecast $10.00 Hims & Hers Health Stock Forecast Details However, these analysts weren’t the only ones on Wall Street willing to publicize their bullish views. Those at the Vanguard Group, Hims & Hers’ largest shareholder, boosted their stakes in the company by 1% in the past quarter. This addition brought the asset manager’s net investment to $221.4 million today, or 6.7% ownership in the company. One last check investors can review is by decrypting the market’s message. To do this, Hims & Hers stock should be compared to the rest of its peer group on a valuation basis. Where a positive outlier is found, that is typically bullish sentiment for the stock. Regarding the price-to-book (P/B) ratio, Hims & Hers stock trades at an 11.1x multiple to command a premium valuation over the medical sector’s average 4.6x multiple today. Usually, there is an excellent reason for stocks to trade at a premium, and investors have more than one when looking at the recent financial momentum in Hims & Hers stock. Before you consider DexCom, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and DexCom wasn't on the list. While DexCom currently has a "Moderate Buy" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here

Cloudflare Stock Flares Up on Solid EPS Beat and Raised Guidance 2024-08-06 14:47:00+00:00 - Cloudflare Today NET Cloudflare $76.24 -1.46 (-1.88%) 52-Week Range $53.88 ▼ $116.00 Price Target $92.29 Add to Watchlist Content delivery network (CDN) service provider Cloudflare, Inc. NYSE: NET reported a solid Q2 2024 earnings report, resulting in a 6% gain the following day. This is impressive, considering the Nasdaq composite index fell nearly 418 points that day. Cloudflare is a one-stop shop for millions of websites offering a global network and comprehensive platform of services ranging from robust cybersecurity to optimized performance for streaming and website loading speeds and reliability. Cloudflare aims to make the internet safer, faster, and more reliable for businesses and end users worldwide. Cloudflare operates in the computer and technology sector, competing with CDNs like Akamai Technologies Inc. NASDAQ: AKAM, Zscaler Inc. NASDAQ: ZS, and Fastly Inc. NYSE: FSLY. Get Cloudflare alerts: Sign Up What is a Content Delivery Network and What Does It Do? A CDN is a network of servers that stores and delivers content instantly, securely, and efficiently to end users. The servers store website content like videos, HTML files, and images, which are readily and instantly accessible when requested. Due to its redundancy and low latency, load times are reduced, resulting in an optimized experience. Cloudflare's CDN network spans over 300 cities in over 100 countries, connecting more than 12,500 networks, reaching over 95% of the world's population in under 50 milliseconds. The result is faster website loading, streaming content, safety from malicious cybersecurity attacks, and better browsing for users. Cloudflare is More than Just a CDN Cloudflare provides value-added services in addition to its CDN. It claims itself to be the world’s first connectivity cloud. It’s integrated with all networks with built-in intelligence on a unified and simplified interface. It provides firewalls, TLS encryption, image optimization, and caching to expedite loading speeds with direct connections to nearly every service, cloud provider, and major enterprise. Cloudflare’s network blocks 158 billion cyber threats daily. Cloudflare is used by some of the largest hyper scalers, service providers, and internet giants, including Netflix Inc. NASDAQ: NFLX, Amazon.Com Inc. NASDAQ: AMZN, International Business Machines Co. NYSE: IBM, and Uber Technologies. Inc. NYSE: UBER. NET Stock Attempting a Descending Triangle Breakout The daily candlestick chart for NET illustrates a descending triangle breakout pattern. A descending triangle is a bearish pattern comprised of a descending upper trendline, which started at $87.18, falling to the flat-bottom lower trendline support at $74.37. NET attempted to break out of the triangle twice, but each time failed as shares fell back under the descending trendline as lower highs continued to form. The Q2 2024 earnings beat caused a gap above the upper trendline resistance and is attempting to break out for the third time. The daily relative strength index (RSI) is attempting to bounce through the 50-band. Pullback support levels are at $76.52, $74.37, $71.77, and $68.95. Growth Continues to Accelerate Cloudflare reported Q2 2024 EPS of 20 cents, beating consensus estimates by 6 cents. GAAP gross profit was $312 million or 77.8% gross margin. Net income was a GAAP net loss of $15.1 million compared to a loss of $94.5 million in the year-ago period. Non-GAAP net income was $69.5 million, up from $33.7 million last year. Revenues surged 30% YoY to $401 million, beating $394.11 million consensus analyst estimates. Operating cash flow was $74.8 million or 19% of revenue, and cash flow of $38.3 million was 10% of revenue. Cloudflare closed the quarter with $1.757 billion in cash and cash equivalents. Cloudflare Issues Upside Guidance The current landscape of enterprises buying IT services and products has turned darker amidst macroeconomic uncertainty. Companies have stated that deals are being scrutinized more as the sales cycle gets elongated. This backdrop is what makes Cloudflare’s upside guidance impressive and may further justify its stock price trading at over 80x non-GAAP 2025 operating profits. Cloudflare provided upside guidance for both Q3 and full year 2024. For Q3 2024, Cloudflare forecasts EPS of 18 cents versus 15 cents consensus estimates. Revenues are expected between $423 million to $424 million versus $422.74 million consensus estimates. Non-GAAP income from operations is expected between $50 to $51 million. Cloudflare Stock Forecast Today 12-Month Stock Price Forecast: $92.29 19.86% Upside Hold Based on 25 Analyst Ratings High Forecast $135.00 Average Forecast $92.29 Low Forecast $57.00 Cloudflare Stock Forecast Details The company expects full-year 2024 EPS between 70 cents and 71 cents versus 61 cents in consensus estimates. Revenues are expected between $1.657 billion and $1.659 billion, versus $1.65 billion in consensus analyst estimates. Non-GAAP income from operations is expected between $196 million and $198 million. Cloudflare Co-Founder and CEO Matt Price commented, “We had a strong second quarter, crossing $1.6 billion in annualized revenue and growing 30% year-over-year. The world is still complicated, but our team remained focused on execution and delivered terrific results, including a double-digit year-over-year improvement in sales productivity.” Cloudflare analyst ratings and price targets are at MarketBeat. There are 25 analyst ratings on NET stock, comprised of 10 Buys, 12 Holds, and three Sells. The stock has a 15.8% upside to the consensus price target of $92.08. Before you consider Cloudflare, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Cloudflare wasn't on the list. While Cloudflare currently has a "Hold" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here

Palantir Stock Surges After Strong Earnings: Is $30 Too Low? 2024-08-06 14:24:00+00:00 - Palantir Technologies Inc. NYSE: PLTR stock is up more than 11% in pre-market trading after it released its second quarter 2024 earnings after the market closed on August 5, 2024. By any measure, this was a strong report. But will it be enough to silence critics that PLTR stock is too expensive? Palantir Technologies Today PLTR Palantir Technologies $26.59 +2.50 (+10.38%) 52-Week Range $13.68 ▼ $29.83 P/E Ratio 221.60 Price Target $21.96 Add to Watchlist Earnings reports frequently focus on the headline numbers, and Palantir delivered a strong report in that regard. Revenue of $678 million beat analysts’ expectations by 3.9%. Get Palantir Technologies alerts: Sign Up But those numbers look significantly stronger when you look at them year-over-year (YoY). Revenue was 27% higher YoY. That growth took place in both the company's U.S. government business (up 24%) and its U.S. commercial business (55%). The company also posted 83% U.S. Commercial growth. In the quarter, the company closed 27 deals valued at over $10 million, translating to a 41% growth in customer count. On the heels of those results, the company increased its revenue guidance for the third quarter and the full year. Earnings May Seal the Deal With the S&P 500 Investors who follow Palantir know that the stock was rebuffed for inclusion in the S&P 500 for the second time in June 2024. The next opportunity for the company will come in September. Earnings of nine cents per share beat expectations by one cent and were 800% higher YoY. Palantir Technologies Stock Forecast Today 12-Month Stock Price Forecast: $22.54 -16.29% Downside Reduce Based on 15 Analyst Ratings High Forecast $35.00 Average Forecast $22.54 Low Forecast $7.50 Palantir Technologies Stock Forecast Details In November 2023, Palantir met the threshold for inclusion in the S&P 500 by posting its fourth consecutive positive quarterly earnings. These results confirm that the company is not only staying profitable but also growing profits at a strong pace. In an interview on August 5, Palantir chief financial officer (CFO) David Glazer confirmed, “With these results we maintain our eligibility for the S&P...It’s the S&P’s call.” As Palantir’s investors understand, inclusion in the S&P 500 will likely bring more institutional investors into PLTR stock. Currently, institutions hold approximately 45% of the stock’s float. Why Palantir? Even for those who are well-versed in technology stocks, particularly software stocks, Palantir can be difficult to understand. However, as analysts focus on monetizing AI, it’s critical to understand Palantir’s unique role in making this happen. Many people understand the role that large language models (LLMs) play in deploying AI applications for enterprises. Palantir does offer its own LLM through its AIP platform, which is gaining traction. However, the company also delivers the infrastructure that LLMs need to help businesses make critical decisions. That’s where the company’s ontology comes in. That ontology, found in its Gotham and Foundry platforms, enables its customers to gather meaningful insights from whatever LLM they may use. As I've heard it described, LLMs are like early automobiles; Palantir is building the roads and bridges that make those cars go. That's important because Palantir is going to market with a two-pronged strategy that focuses on ensuring it offers a value proposition to its customers. Because of that value, the company is attempting to capture a massive market share in what will be a trillion-dollar market in the next 10 years. Is a $30 Price Target for Palantir Too Low? Dan Ives of Wedbush has been one of the most bullish analysts regarding PLTR stock. In 2023, Ives referred to Palantir as the “Lionel Messi of AI” and issued a $30 price target on the stock. Ives has since increased that target to $35. After the earnings report, the analyst reiterated his Outperform rating on PLTR and raised his price target to $38. However, not all analysts share that outlook. The Palantir analyst forecasts on MarketBeat show that two analysts have issued price targets for PLTR that are far below the price the stock was trading at prior to the earnings report. Palantir Technologies Inc. (PLTR) Price Chart for Tuesday, August, 6, 2024 Before you consider Palantir Technologies, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Palantir Technologies wasn't on the list. While Palantir Technologies currently has a "Reduce" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here

Axios Laying Off 10% of Staff 2024-08-06 14:14:26.813000+00:00 - The eliminated positions are across the 500-person company, including in the newsroom, according to a person familiar with the matter. It is the first time the company has instituted layoffs. Axios was started in 2017 by Mr. VandeHei and his business partners Mike Allen and Roy Schwartz, all of whom previously worked at Politico, the political news site. The publication quickly made a name for itself with its bullet-point format, distilling the news down into bite-size chunks. In 2022, Axios was sold to Cox Enterprises in a deal valuing the media outlet at $525 million. The three founders continue to run the company. Mr. VandeHei said in the email to staff on Tuesday that moving forward, Axios would increase its focus on U.S. news coverage and more rapidly expand its city-specific newsletters to new locations. He also said the company would continue building its paid subscription product, Axios Pro, which is aimed at business professionals. Axios is also continuing to explore potential acquisitions. Mr. VandeHei told The Times earlier this year that the rise of A.I. had influenced his thinking on how to position his media company, developing a thesis that the only outlets that would survive the technology were ones that had journalistic expertise, trusted content and in-person human connection. Mr. VandeHei said at the time that Axios would increase the number of live events it holds as well as build paid memberships around some of its star journalists.

There is a Big Opportunity in Microchip Technology’s Sell-Off 2024-08-06 14:07:00+00:00 - Microchip Technology NASDAQ: MCHP stock is selling off for more reasons than one, but its operational quality, market position, and outlook make this a buy-the-dip opportunity. Among the takeaways from the Q1 release are that near-term headwinds, including end-market inventory normalization and macroeconomic headwinds, weigh on the market today. Still, the long-term outlook for semiconductor solutions is robust. Microchip Technology Today MCHP Microchip Technology $74.67 +0.81 (+1.10%) 52-Week Range $68.75 ▼ $100.57 Dividend Yield 2.42% P/E Ratio 21.52 Price Target $99.42 Add to Watchlist The long-term outlook is robust because Microchip Technology is a leader in embedded control systems used by a diverse clientele, all facing a secular upgrade cycle. The upgrade cycle is driven by rapidly improving technologies related to AI. It will last for many years, leading to follow-on cycles as technology advances, sustaining operations and growth for this business. If (when) the FOMC cuts interest rates, there will be a tailwind to compound the business's inherent strengths, including a healthy capital return program. Get Microchip Technology alerts: Sign Up Among the details suggesting this stock will rebound strongly are the analysts. The analysts are trimming their price targets following the release, but the cuts are marginal, and the consensus is for a 35% upside. Regarding the impact of revisions, the consensus is down following the release, but only by a dollar to $99, remaining within the tight range it has been in for the last year, showing a high level of conviction. More importantly, the stock sell-off is overblown, creating a deep value by trading beneath the analysts' lowest target of $80. Microchip Technology Falters on Slow Return to Growth Microchip Technology struggled in Q1 despite the “green shoots” mentioned in the previous reporting. The company’s net revenue of $1.24 billion is down 6% sequentially and 46% compared to last year, missing the consensus estimate due to the slow reboot of inventories in key end markets. Margin is another area of weakness, although the news is better-than-expected. The company’s margin narrowed significantly at the gross and operating levels and on a GAAP and adjusted basis. Deleverage is the primary culprit, but one-offs include the amortization of acquisitions-related intangibles. The takeaway is that adjusted earnings are down more than 60% compared to the 46% top-line decline but beat the consensus estimate reported by MarketBeat by a penny. Microchip Technology Dividend Payments Dividend Yield 2.40% Annual Dividend $1.81 Dividend Increase Track Record 23 Years Annualized 3-Year Dividend Growth 29.30% Dividend Payout Ratio 52.16% Next Dividend Payment Sep. 5 MCHP Dividend History As bad as the operational results are, the company continues to drive sufficient cash flow to sustain operational quality and capital returns. The free cash flow margin came in below last year but healthy at 25% of revenue, enough to sustain capital return with only a minor decrease in the cash balance. The capital return topped $315 million for the quarter, including dividends and share buybacks, compared to $304 million in free cash flow and $390.5 million in operating income. Over the past twelve months, buybacks have been accretive to shareholders, reducing the count by an average of 1.5% in Q1. There is ample availability under the current authorization, so repurchases and dividends should continue. The dividend is worth about 2.4% in yield with shares near a one-year low, attractive on its own but more so because the distribution is growing. Microchip Technology has increased the payout yearly for over two decades and shows no signs of ending the trend. The Q1 report includes the latest increase, worth 10% to investors and more than enough to offset inflation. The Technical Outlook: Microchip Technology Reverts to Trend The price action in MCHP is down following the results and may remain under pressure for the next few weeks or months, but a rebound is expected before the year’s end. This stock is in a sustained uptrend and nearing price levels that have produced strong rebounds. Assuming the market takes advantage of this opportunity, shares of MCHP are unlikely to fall below $70 or stay there long if they do. The risk is that the recovery in power control markets will remain sluggish through year’s end, leaving this stock to wallow until business traction is regained. Before you consider Microchip Technology, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Microchip Technology wasn't on the list. While Microchip Technology currently has a "Moderate Buy" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here

Market Shock: How Sectors Have Shaped Up During Historic Sell-Off 2024-08-06 13:52:00+00:00 - Over the past week, the stock market experienced a significant downturn, marked by a historic sell-off across multiple sectors and global markets. Here's a detailed look at what transpired and how the key sectors have fared amid the volatility. Get XLU alerts: Sign Up Market Turmoil: Recent Sell-off The stock market faced a significant sell-off last week, primarily due to disappointing job data and rising recession fears. The S&P 500 fell 1.84%, the Nasdaq Composite slid 2.43%, and the Dow Jones Industrial Average dropped 1.51%, hitting a session low with a nearly 1,000-point decline. The Labor Department's report showed nonfarm payrolls increased by only 114,000 in July, significantly below the expected 185,000, with the unemployment rate rising to 4.3%. Amid concerns that the Federal Reserve's decision to maintain current interest rates might have been a mistake, investors flocked to bonds, pushing the 10-year Treasury yield to its lowest since December. Mega-cap stocks suffered notable losses: Amazon fell 8% on the week after missing revenue estimates and issuing a weak forecast, Intel dropped 26% on poor guidance and layoffs, and the market's darling NVIDIA decreased by 1.8% on Friday following a 6% decline the previous day. Monday's Market Gap Down The situation worsened on Monday as U.S. equities experienced a sharp gap down. Sunday futures were significantly lower after panic ensued in the Japanese market, with extreme sell-offs in the Nikkei 225 (Japan's S&P 500), causing a ripple effect globally. U.S. stocks were particularly impacted by the rapid unwinding of "carry trades." Sector Performance During Market Volatility Let's analyze how the popular sector ETFs have shaped up during these recent days of volatility compared to the benchmark. XLF: Financial Select Sector SPDR Fund The XLF NYSE: XLF tracks financial services companies, including banks, investment funds, and insurance companies. Last week, the famous financial ETF was down slightly over 3%, making it one of the worst-performing sectors. Yesterday, those losses extended, bringing its five-day performance to negative 6.6%. YTD, however, the sector ETF remains positive at 8.6%. Financial Select Sector SPDR Fund (XLF) Price Chart for Tuesday, August, 6, 2024 XLK: Technology Select Sector SPDR Fund The XLK NYSE: XLK focuses on the technology sector, including companies in software, hardware, and IT services, and is heavily comprised of members of the magnificent seven. The XLK has been one of the hardest hit sectors, with last week's losses totaling 5.34% and extending by an additional 3.33% on Monday. After sharply reversing off its lows on Monday, the XLK closed near its 200-day SMA, which will be a critical trend inflection point in the future. Technology Select Sector SPDR Fund (XLK) Price Chart for Tuesday, August, 6, 2024 XLE: Energy Select Sector SPDR Fund The XLE NYSE: XLE represents the energy sector, including companies involved in oil, gas, and renewable energy. Like the sectors mentioned above, the XLE's decline of 4.1% last week was greater than the benchmarks' (SPY) weekly loss of 2.1%. Monday's panic and further decline of 2.2% added to its pullback, with the sector ETF now trading below critical support near $88 and flattening 200-day SMA. Energy Select Sector SPDR Fund (XLE) Price Chart for Tuesday, August, 6, 2024 XLU: Utilities Select Sector SPDR Fund The XLU NYSE: XLU tracks utility companies, including electric, water, and gas utilities. Unlike the overall market and the sectors mentioned above, the XLU acted as a haven last week, with the ETF achieving new 52-week highs and closing the week up an impressive 4.1%. However, on Monday, it could not remain uncorrelated to the overall market and experienced a 2.6% decline to trade back near the previous resistance at $72. In the future, it will be essential to see whether that area can be turned into support. Utilities Select Sector SPDR Fund (XLU) Price Chart for Tuesday, August, 6, 2024 XLP: Consumer Staples Select Sector SPDR Fund The XLP NYSE: XLP covers essential consumer goods companies, including food, beverages, and household products. Up almost 1% last week, the consumer staples sector acted true to its nature as a somewhat recessionary-proof sector with a solid defensive nature. However, as various growth and innovation stocks and industries staged impressive rebounds off the lows on Monday, the XLP pulled back, declining almost 2%. The sector ETF remains just 2.5% away from its 52-week high, within a firm uptrend, with $76 as the line in the sand. Consumer Staples Select Sector SPDR Fund (XLP) Price Chart for Tuesday, August, 6, 2024 Before you consider Utilities Select Sector SPDR Fund, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Utilities Select Sector SPDR Fund wasn't on the list. While Utilities Select Sector SPDR Fund currently has a "hold" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here

Caterpillar: The Rebound Is On, New Highs In Sight 2024-08-06 13:43:00+00:00 - Caterpillar’s NYSE: CAT stock price was not immune to the threat of recession, but its Q2 results disprove the idea that the global economy is on the brink now. The report highlights outperformance on the top and bottom lines driven by sequential improvements in all segments and regions. The company is still in contraction compared to last year’s figures, but a return to growth is expected by the end of the year, and now, a budding tailwind is strengthening. The July NFP report suggests weakening in the US labor market, enough to spur the FOMC to cut rates sooner or more aggressively than the market had been pricing. Lower rates will catalyze global spending projects from public to private sectors relying on Caterpillar’s industrial products and services. Get Caterpillar alerts: Sign Up Caterpillar Crawls Higher After Better-Than-Expected Q2 Results Caterpillar Today CAT Caterpillar $326.44 +9.64 (+3.04%) 52-Week Range $223.76 ▼ $382.01 Dividend Yield 1.73% P/E Ratio 14.74 Price Target $335.00 Add to Watchlist Caterpillar is not out of the weeds yet, but the Q2 results suggest it is working through the pullback and setting up for a solid year in 2025. The company reported $16.69 in net revenue, a decline of 3.5% that outpaced the consensus by a slim ten basis points, with the real strengths showing up on the bottom line. The company reports sales are down YOY in two segments, Construction and Resources, offset by a gain in Energy & Transportation. Regionally, North America and Latin America were strongest, up 1% and 5%, offset by YOY declines in EMEA, Asia, and External Sales. Regarding volume and pricing, volume is down and offset by pricing realization, with a bonus. The bonus is that volume declines are associated with declining dealer inventory levels, setting the company up for an inventory build next year. Pricing is a critical factor because it impacts the bottom line, helping to improve the adjusted operating margin by 110 basis points and to a level above consensus. The takeaway is that GAAP earnings are down on one-offs, but the adjusted EPS of $5.99 is up 8% YOY despite the weakened sales volume, with margin strength expected to stick. Cash flow is another critical detail for investors, allowing for robust capital returns. Caterpillar produces solid cash flow, and Q2 is no different. The company reported $3 billion in operating cash flow, 17.9% of revenue, and returned most of it to shareholders. Capital returns in Q2 included $0.6 billion in dividends and $1.8 billion in share buybacks, which reduced the average share count by 4.95% for the quarter. The balance sheet is also healthy, with only one red flag: the reduction in shareholder equity, which is ultimately a red herring. The decline in equity is due entirely to an increase in treasury shares (the result of buybacks), which more than offsets the decline. Investors can expect capital returns to continue because the company shows traction in the sequential results, and a return-to-YOY growth is expected soon. Analysts Are Driving Caterpillar Stock Higher Caterpillar Stock Forecast Today 12-Month Stock Price Forecast: $335.00 1.39% Upside Hold Based on 15 Analyst Ratings High Forecast $435.00 Average Forecast $335.00 Low Forecast $245.00 Caterpillar Stock Forecast Details The analysts' activity in 2024 is tepid, and Marketbeat tracks no revisions in the first few hours following the Q2 release, but the trend in sentiment is bullish and unlikely to change. The analysts have been initiating targets, lifting sentiment, and raising price targets, leading this stock to a range above the consensus estimate. The consensus is about 3% above the post-release price action, aligning with recent support levels, and most of the fresh targets are new all-time highs. Price action is bullish. The market is rebounding from recent lows due to the company’s inherent strengths and set up to return to the top of a recent trading range. A move to the top of the range would put this market above the consensus target and on track for a new high, which may be reached before the year’s end. The outlook for new highs will improve if analysts issue positive updates or revisions; gains will likely be capped at the range top if the Q2 results do not inspire the analysts. Before you consider Caterpillar, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Caterpillar wasn't on the list. While Caterpillar currently has a "Hold" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here

How Google’s Antitrust Defeat Might Transform Big Tech 2024-08-06 11:40:08.731000+00:00 - What now for Google? The federal court ruling that Google had abused its monopoly in online search threatens to disrupt one of the most valuable businesses in modern history, and Big Tech more broadly. Expect Google to fight back, which could drag this out for some time. Still, the decision will likely carry a lot of consequences for the internet industry. What happened: Judge Amit Mehta of U.S. District Court for the District of Columbia sided with the Justice Department and several states that had accused Google of illegally cementing its search dominance. In large part that was by paying billions each year to companies including Apple and Samsung to make Google the default search engine on their devices. (Apple alone received $20 billion in 2022.) Those agreements hurt competition, Mehta found, allowing Google to trample competitors. That dominance — 94.9 percent of the general search market — then allowed the company to inflate the prices for some search ads, giving it more money to pay Apple and others, he wrote.

World’s Five Leading Chipmakers Have Now Promised U.S. Investment 2024-08-06 09:04:07+00:00 - The Biden administration said on Tuesday that it would award up to $450 million in grants to a South Korean chipmaker, SK Hynix, to help build its new chip facility in Indiana, in what officials described as a milestone in rebuilding the U.S. semiconductor manufacturing industry. With the announcement, the United States now has commitments from all five of the world’s leading-edge semiconductor manufacturers to construct chip plants in the United States with financial assistance from the administration, Commerce Secretary Gina M. Raimondo said in a call with reporters on Monday. The Biden administration previously announced that it had reached agreements with Intel, Taiwan Semiconductor Manufacturing Company, Samsung and Micron to help fund investments in the United States. “These are the only companies in the world capable of producing leading-edge chips at scale,” she said. SK Hynix announced in April that it had committed to investing $3.87 billion in a facility in West Lafayette, Ind. Ms. Raimondo called that investment a “huge deal” because it meant that the United States would “have the most secure and diverse supply chain in the world for the advanced semiconductors that power artificial intelligence.” SK Hynix makes advanced memory chips that are an essential component for creating A.I.

Recession Fears May Be Overstated, but Not Unfounded 2024-08-06 09:03:50+00:00 - The U.S. economy has spent three years defying expectations. It emerged from the pandemic shock more quickly and more powerfully than many experts envisioned. It proved resilient in the face of both inflation and the higher interest rates the Federal Reserve used to combat it. The prospect many forecasters once considered imminent — a recession — looked increasingly like a false alarm. Until now. An unexpectedly weak jobs report on Friday — showing slower hiring in July, and a surprising jump in unemployment — triggered a sell-off in the stock market as investors worried that an economic downturn might be underway after all. By Monday, that decline had turned into a rout, with financial markets tumbling around the world.

How the Google Antitrust Ruling May Influence Tech Competition 2024-08-06 09:00:55+00:00 - In 2000, a ruling in a U.S. antitrust case against Microsoft helped set the rules of competition for the digital giant of its day. At the time, a federal judge said Microsoft had abused the monopoly power of its Windows operating system and ordered that the company be split up. A breakup was reversed on appeal, but key legal findings were upheld. And Microsoft was prohibited from forcing restrictive contracts on its industry partners and ordered to open some of its technology to outsiders — preventing the company from single-handedly controlling the internet. More than two decades later, a ruling in a Google antitrust case similarly promises to shape new rules for the tech industry. Judge Amit P. Mehta of U.S. District Court for the District of Columbia found on Monday that Google had violated antitrust laws by stifling rivals in internet search to protect its monopoly. Google’s loss could have major ripple effects for competition today. U.S. regulators have also accused Apple, Amazon and Meta of violating antitrust laws by advantaging their own products on the platforms they run and acquiring smaller rivals. The Google ruling, and potential remedies to be decided by Judge Mehta, are likely to weigh heavily on those cases, including a second lawsuit against Google over ad technology, which is scheduled to go to trial next month.

Intel Stock Extends Losses as Analysts Say Chipmaker Faces 'Formidable Hurdles' 2024-08-06 05:17:00+00:00 - NurPhoto / Contributor / Getty Images Key Takeways Intel shares tumbled Monday, extending losses after the chipmaker posted disappointing quarterly results last week and announced layoffs to cut costs. Goldman Sachs analysts questioned whether Intel's cost-cutting plan will be enough to drive a recovery. Analysts at Baird said "formidable hurdles remain," anticipating Intel's cost challenges will carry into next year. Intel (INTC) shares dropped over 6% Monday, extending losses after the chipmaker posted disappointing quarterly results last week and announced layoffs to cut costs. In the wake of Intel's latest results, analysts expressed doubts whether the chipmaker's plans to trim expenses and accelerate its manufacturing ramp-up for artificial intelligence (AI) products will be enough to help the firm recover market share. Goldman Sachs analysts said Intel's plans to achieve around $10 billion in cost reductions, which include laying off 15% of its workforce, may not be "sufficient for a sustained recovery in the company's competitive position." Meanwhile, analysts at Baird said "formidable hurdles remain," anticipating Intel's cost challenges will carry into next year. Goldman Sachs analysts maintained a "sell" rating on Intel stock, and lowered their price target to $22 from $19 previously, while Baird analysts held a "neutral" rating and cut their price objective to $20 from $40. Shares of Intel closed 6.4% lower Monday at $20.11. They've lost about 60% of their value since the start of the year. Read the original article on Investopedia.

Lumen secures deals worth $5 billion on AI driven demand for connectivity 2024-08-06 05:13:00+00:00 - (Reuters) - Telecommunications firm Lumen Technologies has secured new deals worth $5 billion from cloud and tech companies for its networking and cyber-security solutions as more businesses rush to adapt AI driven technologies. Deals include one with tech giant Microsoft, which announced last month that it will use Lumen's network equipment to expand its capacity for AI workloads. Lumen, which provides secure digital connections for data centers, said on Monday that it is involved in active discussions with customers to secure sales opportunities worth an additional $7 billion. The surge in AI adoption has led enterprises across multiple sectors to invest heavily in building infrastructure capable of supporting AI-powered applications. Lumen said that major corporations are rushing to secure high-capacity fiber, a resource that is becoming increasingly valuable and potentially scarce, due to growing AI requirements. "Our partners are turning to us because of our AI-ready infrastructure and expansive network. This is just the beginning of a significant opportunity for Lumen, one that will lead to one of the largest expansions of the internet ever," Lumen CEO Kate Johnson said. Separately, Lumen said it has established new division, Custom Networks, to oversee its Private Connectivity Fabric solutions portfolio and meet increasing demand from various organizations. (Reporting by Harshita Mary Varghese in Bengaluru; Editing by Tasim Zahid)

Nvidia shares tank as 'Magnificent 7' stocks lose more than $650 billion in market cap 2024-08-06 04:50:00+00:00 - Nvidia (NVDA) shares fell more than 6% on Monday as the "Magnificent Seven" stocks suffered a valuation wipeout of more than $650 billion during Monday's market plunge. The iconic group of seven stocks have lost roughly $1.3 trillion in market cap over the past three trading sessions. "Mag Seven" component Alphabet (GOOGL, GOOG) slid 4% while Meta (META) fell more than 2%. EV giant Tesla (TSLA) dropped over 4%. Ecommerce giant Amazon (AMZN) and software maker Microsoft (MSFT) also slid. Apart from the broad market sell-off, individual company news also put pressure on the Mag Seven stocks. On Monday a judge found Alphabet's Google search and ad businesses violated antitrust laws, sending shares of the tech giant lower during the session. Apple (AAPL) dropped more than 4% after Berkshire Hathaway (BRK-B) revealed over the weekend it had cut half of its stake in the iPhone maker. Nvidia fell as much as 13% at the market open to pare some of its losses. Analysts noted recent negative catalysts weighing on the AI chip heavyweight. The Information reported the company's upcoming next-generation AI chips would be delayed by three months, potentially impacting its biggest customers like Microsoft, Alphabet, and Meta. "Nvidia has a window to sell to Microsoft, Amazon, Google, and Meta while those companies are hot and bothered about building out data centers as quickly as they can. That window will shut at some point," Gil Luria, D.A. Davidson senior software analyst, told Yahoo Finance on Monday. "If Nvidia is missing out on some of those sales during that window, that does have an impact on Nvidia's value," said the analyst. Monday's action follows a recent heavy sell-off on Wall Street as chip stocks have gotten hammered over the past week. Nvidia stock tumbled more than 5% Monday amid a broader market selloff. (AP Photo/Jeff Chiu, File) (ASSOCIATED PRESS) On Friday Nvidia closed off the lows of the session, down only 1.8%, while Intel (INTC) shares cratered over 26% following a disastrous second quarter earnings report and a broad decline in chip stocks led the tech sector lower. After the July jobs report, which showed job growth slowed last month and the unemployment rate reached a nearly three-year high, the Nasdaq Composite (^IXIC) slipped into correction territory, defined as a 10% drop from its most recent high. Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre. StockStory aims to help individual investors beat the market.

Sell-off on Wall Street: Why it is happening and what it says about the economy 2024-08-06 04:34:00+00:00 - Specialist Glenn Carell works at his post on the floor of the New York Stock Exchange on Monday. Financial markets tumbled around the world. (Richard Drew / Associated Press) It’s nail-biting time on Wall Street. Stocks had been dropping at worrisome rates for several days, but on Monday things went from concerning to panicky. At one point, the Dow Jones industrial average plunged more than 1,200 points, on a day when equity markets tumbled across the globe. It closed down 1,034 points, or 2.6%. Technology stocks have been hit particularly hard lately: The Nasdaq composite was, for a moment on Monday, down more than 10% since the middle of last week, entering into what economists euphemistically call “correction” territory. The sudden pullback has jolted investors and raised questions that go beyond financial markets to questions about the underlying health of the economy. And even when things level out, the window-rattling downturn threatened to kill the political euphoria that has swept over Democrats since President Biden withdrew and Vice President Kamala Harris emerged as the party's standard-bearer. So what's happened and what may be next? Here are first-draft-of-history answers to some of the crucial questions: What’s causing the current plunge in U.S. stock markets? Economists point to several factors behind the sell-off. To begin with, tech stocks were overdone, pushed beyond their underlying value by the artificial intelligence craze. Hence the Nasdaq correction. Nvidia, Apple and Intel were among big losers Monday. And Friday’s jobs report, which showed a sharp slowdown in hiring and unemployment in July, set investors — even those not deep into tech — on edge. That came on the heels of news that jobless claims, a proxy for layoffs, increased significantly in the waning days of July. It hasn’t helped that the Federal Reserve has been reluctant to start cutting interest rates, which have throttled inflation as intended, but also weighed down businesses and consumers. Then there’s the reverberation from global markets. On Monday, Japan’s once-high-flying stocks took their worst drubbing since Black Monday in 1987. The huge losses were seen, in part, as being a reaction to market declines and growing concerns in the U.S. “It’s an unfortunate sequence of events that causes selling, selling, selling,” said Christopher Rupkey, chief economist at Fwdbonds, a research house in New York. How have stock markets in the U.S. performed overall this year? Even with Monday’s panic-selling, stocks generally are up for the year, many way up. Both the broader Standard & Poor's 500 and Nasdaq are still more than 9% higher compared with the start of the year. The Dow is the laggard, up only 2.6% since Jan. 2. Story continues Stocks have benefited from strong corporate earnings; investor excitement over AI’s growth and potential; and the expectation of Fed interest rate cuts, said Mark Zandi, chief economist at Moody’s Analytics. “This is still, at this point, a garden-variety correction,” Zandi said of the current turmoil, though he added that the situation warrants careful watching. “Things can take on a life of their own.” Should I be worried about a recession? Not yet, maybe never. The classical definition of a recession is two straight quarters of declining gross domestic product. The latest, second-quarter GDP, after adjusting for inflation, was a strong 2.8%. Almost every economist agrees that you can’t have a recession without job growth turning negative for some extended period. And the U.S. economy hasn’t come close to that point. Employers have added jobs every month since January 2021, when the economy began to recover from the pandemic. Most recently, in July, job growth came in below expectations, but at 114,000 new payroll hires, that was still solidly positive. “I don’t see the underpinnings of an economic downturn,” said Jack Ablin, chief investment officer and founding partner at Cresset Capital. Can anything be done to arrest the decline in stocks? To quell the sell-off, some investors have urged the Fed to cut interest rates now, in a kind of emergency move ahead of the central bank’s next scheduled meeting in mid-September. Fed officials have taken such steps before, during the pandemic and the Great Recession, for example. But analysts doubt that the policymakers will intervene unless markets keep faltering badly; making an emergency cut could make things worse by frightening people and causing a market meltdown. “It’s certainly not a hair-on-fire moment,” Zandi said. What are the risks going forward? With more people on edge about the economy, further declines in the stock market could erode confidence among businesses and consumers, leading to a pullback in hiring and spending. That would be a psychological development, but economies are not immune to the fears or the hopes of their human components. Consumer spending, which drives the U.S. economy, has held up very well in recent years, thanks to steady job and wage growth. But there are indications from companies such as McDonald's and Starbucks that consumers are becoming more cautious. Higher-income households account for a disproportionately big share of spending, which has been supported by rising gains in home and stock prices. A sharp drop in stocks would have the reverse impact, a so-called negative wealth effect, making richer households more averse to spending, which could lead to a recession. Sign up for our Wide Shot newsletter to get the latest entertainment business news, analysis and insights. This story originally appeared in Los Angeles Times.