U.S. stocks are modestly higher today as investors look for a steadier session and await the January FOMC minutes for further clarity on the path of rate cuts. Still, domestic equities have lagged a strong global rally, struggling to keep pace with momentum abroad. The S&P 500 is down about -1% year-to-date while ex-U.S. stocks have gained +8%, marking the worst relative start for U.S. markets since 1995, as American valuations remain stretched. As growth abroad stabilizes and geopolitical risks rise domestically, investor attention has tilted overseas, challenging the long-standing premium placed on U.S. stocks.
Nvidia and Meta Deepen Multi-Year AI Partnership
Nvidia (NVDA) unveiled a sweeping multi-year partnership with Meta (META) to power the social media giant’s expanding AI infrastructure, sending NVDA shares higher in premarket trading. META will ramp up deployments of NVDA's Grace CPUs, marking the first large-scale Grace-only rollout, while preparing to adopt next-gen Vera CPUs, GB300 systems, and Spectrum-X networking to boost data center performance and efficiency. The collaboration also includes NVDA's Confidential Computing for WhatsApp, enhancing AI capabilities while safeguarding user privacy.
Berkshire Trims Apple Further, Buys New York Times
Berkshire Hathaway (BRK) disclosed it reduced its Apple (AAPL) stake by -4% in Q4 to $62B, while initiating a new $351.7M position in The New York Times (NYT). Even after the trim, AAPL remains BRK’s largest holding, though the conglomerate has steadily pared its exposure over recent quarters. The moves come amid a leadership transition to Greg Abel as CEO, with investors watching whether portfolio shifts signal a broader repositioning. Despite AAPL’s recent underperformance versus the S&P 500, BRK’s allocation still reflects a high-conviction core holding.
Arm Moves Higher Despite Nvidia Exiting Long-Held Position
Arm Holdings (ARM) is up over +1% in premarket trading after filings showed Nvidia (NVDA) sold its remaining 1.1M–share stake. NVDA had been reducing its position since ARM’s 2023 IPO following its failed takeover attempt. Despite the exit, the companies remain linked through long-term licensing, and investors appeared largely unfazed by the divestment.
Palo Alto Slips as Soft Outlook Overshadows Solid Quarter
Palo Alto Networks (PANW) is down over -7% in premarket trading even after delivering a Q2 beat, as cautious earnings guidance tempered enthusiasm. Revenue rose +15% YoY to $2.6B and EPS of $1.03 topped estimates, with annual recurring revenue climbing +33% and backlog exceeding expectations. However, fiscal Q3 EPS guidance of $0.78 to $0.80 came in well below forecasts, raising concerns about near-term profitability amid an aggressive acquisition spree and ongoing AI investments.
