Stocks Get Tech Boost After Trade-Fueled Selloff: Markets Wrap

(Bloomberg) — A renewed wave of dip buying lifted stocks after a wild day for financial markets around the world, with big tech leading the way ahead of results from Google’s parent Alphabet Inc.

Following a slide fueled by uncertainties over a trade war, equities rebounded as investors sifted through a batch of corporate results. Bullish revenue forecasts from giants like Palantir Technologies Inc. and Infineon Technologies AG bolstered sentiment. The Nasdaq 100 climbed over 1% and all companies in the “Magnificent Seven” cohort of megacaps advanced. Meta Platforms Inc. rose for a 12th consecutive session  — the longest winning streak ever.

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“Short-term market jitters have proven good short-term buying opportunities,” said Craig Johnson at Piper Sandler.

Data Tuesday showed US job openings fell by more than forecast to a three-month low, consistent with a gradual slowdown in the labor market. The figures support the Federal Reserve’s assertion that the job market is no longer a source of inflationary pressures.

The first volleys in the latest US-China trade war made clear that Xi Jinping is taking a more cautious approach than during Donald Trump’s first term. After the US leader gave a last-minute reprieve to both Canada and Mexico, his 10% tariffs on China took effect on Tuesday. Within seconds, Beijing announced additional tariffs on roughly 80 products to take effect on Feb 10. The question now is whether leaders of the world’s biggest economies can quickly reach an agreement before Chinese tariffs kick in.

“There is a reasonable likelihood that the ultimate impact from these tariffs may be less than expected,” said Todd Ahlsten at Parnassus Investments. “These tariffs may also represent the first round of an ultimate negotiation, which could reduce their ultimate impact.”

The S&P 500 rose 0.6%. The Nasdaq 100 climbed 1.2%. The Dow Jones Industrial Average added 0.1%. A Bloomberg gauge of the “Magnificent Seven” megacaps rallied 1.4%. The Russell 2000 of small caps gained 0.9%.

The yield on 10-year Treasuries declined three basis points to 4.53%. The Bloomberg Dollar Spot Index fell 0.7%. The Mexican peso was little changed. Canada’s loonie rose 0.8%.

Despite being targeted by Beijing in retaliation to US trade tariffs, Alphabet’s durable growth and attractive valuation may offer insulation from all the geopolitical uncertainty. 

China on Tuesday announced a probe of Alphabet’s Google for alleged antitrust violations. Given the firm’s search services have been unavailable there since 2010, the stock rose ahead of results due after the close. 

While the Google parent has been trading near record levels, analysts say it still stands out as a bargain, especially among megacap tech firms at the heart of artificial intelligence — the trade that has lifted markets for two years.

“GOOGL – the sleeper in the group, cheapest of the Mag7, headline risk with noise around their ability to keep their lead across search and AI but the stock is attractive and looks to be breaking out,” said Eric Clark, portfolio manager at Rational Dynamic Brands Fund. “Add here for people that don’t own it.”

Corporate Highlights:

• Palantir Technologies Inc. gave a full-year revenue forecast that exceeded analysts’ estimates, thanks to what Chief Executive Officer Alex Karp described as “untamed organic growth” in demand for its artificial intelligence software.
• Infineon Technologies AG forecast revenue that beat analyst estimates, a bright spot in an industry that’s been grappling with a prolonged slump.
• Salesforce Inc. is cutting jobs as its latest fiscal year gets underway, according to a person familiar with the matter, even as the company simultaneously hires workers to sell new artificial intelligence products.
• PayPal Holdings Inc. reported slowing growth in its card-processing business even as fourth-quarter earnings topped analysts’ estimates.
• NXP Semiconductors NV gave a disappointing forecast for first-quarter revenue, signaling that sluggish demand for industrial and automotive chips is lingering.
• Spotify Technology SA posted another quarter of better-than-expected subscriber growth in the fourth quarter, helping the Swedish music company record its first-ever annual profit.
• PepsiCo Inc. reported sales that missed expectations and forecast sluggish growth for 2025 as North American shoppers pull back on purchases of snacks from the maker of Cheetos and Mountain Dew.
• Clorox Co. raised sales and earnings guidance for the current year while also reporting better-than-expected quarterly results, showing that the bleach maker’s business continues to recover from a 2023 hack that disrupted operations.
• Pfizer Inc.’s fourth quarter beat expectations on strong sales of its Covid vaccine and pill, bolstering its sales as it seeks to fend off criticism from an activist investor that has argued the company squandered its pandemic gains and needs a new path forward.
• Merck & Co. is halting shipments to China of its cancer-preventing Gardasil vaccine, threatening the future of one of its best-selling products and dragging down the company’s outlook in the process.
• Centene Corp. reported a fourth-quarter profit beat that was aided by a settlement related to payments for patients insured though Obamacare plans.
• Estée Lauder Cos. said it plans to eliminate between 5,800 to 7,000 positions in a corporate restructuring meant to return the flagging company to sales growth under its new chief executive officer.
• Archer-Daniels-Midland Co. is weighing asset divestitures as part of a plan to slash costs as the crop trading giant faces a downturn in profits.
• Apollo Global Management Inc.’s plan to tap wallets of rich clients is paying off, with its wealth business raking in record capital last year and boosting assets from the sector 50%.
• KKR & Co. raised its forecast for earnings from long-term private equity wagers and announced that it will increase its ownership in three investments.
• Grab Holdings Ltd. is weighing a takeover of rival GoTo Group at a valuation of more than $7 billion, accelerating talks for a combination to end years of losses in Southeast Asia’s competitive internet market.

Key events this week:

• China Caixin services PMI, Wednesday
• Eurozone HCOB Services PMI, PPI, Wednesday
• US trade, Wednesday
• Fed’s Austan Goolsbee, Tom Barkin, Michelle Bowman, Philip Jefferson speak, Wednesday
• Eurozone retail sales, Thursday
• UK rate decision, Thursday
• US initial jobless claims, Thursday
• Fed’s Christopher Waller, Lorie Logan speak, Thursday
• Amazon earnings, Thursday
• US nonfarm payrolls, unemployment, University of Michigan consumer sentiment, Friday
• Fed’s Michelle Bowman, Adriana Kugler speak, Friday

Some of the main moves in markets:

Stocks

• The S&P 500 rose 0.6% as of 11:13 a.m. New York time
• The Nasdaq 100 rose 1.2%
• The Dow Jones Industrial Average rose 0.1%
• The Stoxx Europe 600 rose 0.1%
• The MSCI World Index rose 0.7%
• Bloomberg Magnificent 7 Total Return Index rose 1.4%
• The Russell 2000 Index rose 0.9%

Currencies

• The Bloomberg Dollar Spot Index fell 0.7%
• The euro rose 0.4% to $1.0382
• The British pound rose 0.2% to $1.2481
• The Japanese yen rose 0.1% to 154.51 per dollar
• The Mexican peso was little changed at 20.3699
• The Canadian dollar rose 0.8% to 1.4312

Cryptocurrencies

• Bitcoin fell 2.4% to $99,460.42
• Ether fell 1.1% to $2,787.05

Bonds

• The yield on 10-year Treasuries declined three basis points to 4.53%
• Germany’s 10-year yield advanced one basis point to 2.40%
• Britain’s 10-year yield advanced three basis points to 4.52%

Commodities

• West Texas Intermediate crude fell 1% to $72.43 a barrel
• Spot gold rose 0.8% to $2,838.71 an ounce

This story was produced with the assistance of Bloomberg Automation.

–With assistance from Robert Brand, Margaryta Kirakosian and Aya Wagatsuma.

©2025 Bloomberg L.P.