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January 2025

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AI Stocks and Their Impact on the Stock Market: Hype or Reality?

4 Mins Read

The week started with a wild ride when DeepSeek created a bizarre “deep sink” day in the stock market. NVIDIA Corp. (NVDA) was one of the most actively traded stocks, closing lower by 16.97%. The stock lost $593 billion in market cap, which, according to Barron’s, is the most market value a stock has lost in a single day. There was a lot of talk suggesting the semi-bubble may have burst.

The release of DeepSeek R1, an AI tool that appears to be much more efficient than other large language models caused NVDA’s stock price plunge. This raises questions about the need for expensive hardware that NVDA and its competitors provide. Reduced hardware needs would mean less spending on AI infrastructure, impacting employment and, ultimately, the economy.

Despite the massive selloff in semiconductor stocks, other areas didn’t feel as much pain. The Dow Jones Industrial Average ($INDU) closed higher, the S&P Equal Weighted Index ($SPXEW) closed up 0.02%, and seven of the 11 S&P sectors closed in the green. The top-performing sectors were Consumer Staples, Health Care, and Financials (see image below). Out of the Mag 7 stocks, Meta Platforms (META), Apple (AAPL), and Amazon (AMZN) closed higher. These companies would benefit greatly from the implementation of AI tools.

However, Monday’s selloff may have been overhyped because, on Tuesday, the narrative shifted. The chart below shows how the S&P 500 ($SPX) bounced off its 21-day exponential moving average (EMA).

FIGURE 1. S&P 500 BOUNCES BACK. A bounce off its 21-day EMA and improving breadth suggests the S&P still has legs.Chart source: StockCharts.com. For educational purposes.

Interestingly, the NYSE New 52-week highs outnumbered the New 52-week lows on Monday. This should have indicated that Monday’s selloff could be a short-lived overreaction.

Overall, the uptrend in the S&P 500 has not suffered much harm, but considering it’s close to its top, a little hesitancy to continue higher is healthy.

The Nasdaq Composite still has a little work to do before confirming its bull trend. An upside follow-through and improving breadth would confirm a bullish trend (see chart below).

FIGURE 2. NASDAQ COMPOSITE NEEDS A LITTLE MORE UPSIDE FOLLOW-THROUGH. Improving breadth indicators and a continuation to the upside would confirm the Nasdaq’s bullishness.Chart source: StockCharts.com. For educational purposes.While the index broke above its downward-sloping trendline connecting the lower highs, Monday’s price action broke that trajectory. Investors should look for the Nasdaq to resume an uptrend—a series of higher highs and higher lows. The Nasdaq Composite Bullish Percent Index (BPI) is shy of 50, about 45% of Nasdaq stocks are above their 200-day moving average, and the Nasdaq Advance-Decline Line is still not convincingly bullish. The Nasdaq is still at a crossroads, but it has a lot of damage to overcome.

The Dow Jones Industrial Average ($INDU), which was running behind, has caught up with the other indexes and is getting very close to its all-time high. Its breadth is also strengthening—a respectable BPI of 63.33, a rising Advance-Decline Line, and 25% of Dow stocks above their 200-day simple moving average.

FIGURE 3. DOW JONES LEADS THE INDEXES. The Dow is looking the most bullish of the three indexes.Chart source: StockCharts.com. For educational purposes.

The Bottom Line

Investors should always worry about protecting their portfolios, so it shouldn’t be surprising that negative news sent investors into a panic-selling mode. Profit-taking from a strong stock performer such as NVDA is a natural reaction. After getting slammed beyond belief on Monday, NVDA’s stock price recovered on Friday, closing higher by 8.82%. It hasn’t recovered all its losses, but Tuesday’s move is encouraging.

Wednesday will be an eventful day. There’s the Fed meeting and Tech earnings are in full swing. Microsoft Corp. (MSFT), Meta Platforms (META), and Tesla, Inc. (TSLA) report quarterly earnings after the close. META closed at an all-time high, MSFT closed higher and recovered from Monday’s loss, and TSLA closed slightly higher. Will the upward move continue?

Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional.

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‘We came back for nothing’: Returning home to northern Gaza, Palestinians find death and destruction

6 Mins Read

Khamis and Ahmad Imarah knew they wouldn’t find much more than rubble when returning to their home in northern Gaza. But they had to go. Their father and brother are still buried under the debris, more than a year after their home was struck by Israeli forces.

“I don’t want anything else. What I am asking for is to find my father and brother and that’s it, that’s all.”

The Gaza Government Office said Wednesday that some 500,000 displaced Palestinians — almost a quarter of the enclave’s population — had made the journey to the decimated north in the first 72 hours after Israeli forces opened the Netzarim corridor, which separates it from the south.

The two Imarah brothers walked 11 kilometers (6.8 miles) to reach Al-Shujaiya, a treacherous journey they made with several small children. They found their home almost completely gone, with just one room still partially standing.

Rummaging through the rubble, Khamis came across his mother’s green knitting bag, with a couple of balls of yarn and two crochet hooks still inside, as if she had only just put it down.

Some 500,000 displaced Palestinians have made the journey to the decimated north since Monday.
CNN

Khamis and Ahmad’s mother was injured in an Israeli strike and was later evacuated to Egypt, one of the few Palestinians allowed to leave the strip to get medical treatment before Israel closed the Rafah crossing between Gaza and Egypt in May 2024. The United Nations Office for the Coordination of Humanitarian Affairs (OCHA) said that only 436 patients, most of them children, had been allowed to be evacuated since May, out of the estimated 12,000 who urgently need medical evacuation.

Israeli military strikes have turned most of Gaza to rubble. According to the UN, some 69% of all structures in the strip have been destroyed or damaged in the past 15 months, with Gaza City the worst hit.

Returning after more than a year

Israel forced most residents of northern Gaza to leave the area early in the war, issuing evacuation orders and telling people to move south. Once people left, return was impossible, meaning that most of those coming back this week are doing so for the first time in more than a year. And while nine in 10 Gaza residents have been displaced during the war, those forced to flee the north have been homeless for the longest.

“You enter from one neighborhood to another and it’s all mounds of rubble that have not been cleared … and there were martyrs on the way, on the road where, until today, no one has picked them up. There are fresh bodies and bodies that have (decomposed) as well,” Khamis said.

Israeli military strikes have razed most of Gaza to rubble.
CNN

He urged others looking to make the journey back north to reconsider. “Because there is no water, no electricity or even food, no tents, you sleep in the rubble,” he said.

Mohammad Salha, director of Al-Awda Hospital in Tal Al-Zaatar, said there is currently no space in northern Gaza to establish camps for displaced people returning home. The area was densely built-up before the war and the enormous scale of damage means there are now huge mountains of rubble and debris everywhere.

The situation in the north is so dire that some of those who have made the journey have had little choice but to turn back and return to the refugee camps down south.

Arwa Al-Masri, who was displaced from Beit Hanoun in the northeastern corner of the strip, said the men from her family went home in the past few days to see what is left of their houses.

But while she and her children cannot yet go back to her home in the north — or what remains of it — Al-Masri’s stay at the shelter is also uncertain, because of impending bans on UNRWA operations within Israel and on the prohibition of Israeli authorities from cooperating with UNRWA.

‘No one is left’

Discovering that the place they once called home was almost completely gone was just the latest in a series of heartbreaks Khamis and Ahmad Imarah have suffered over the past 15 months.

The two brothers said that of the 60 members of their extended family, only 11 have survived the war.

The family fled Al-Shujaiya after receiving text messages from the Israeli military telling them to leave the area. Khamis said the whole family — his brother and sisters and their in-laws — went to his brother’s house in Al-Mughraqa, just south of the Netzarim corridor.

“It was afternoon prayers time when our house in Al-Mughraqa was hit by a strike. I still don’t know how I got out of the house,” he said.

At one point during the interview, Ahmad’s son Walid came by. Asked by his father where his mom was, the child pointed up to the sky.

According to the UN, some 69% of all structures in the strip have been destroyed or damaged in the past 15 months, with Gaza City the worst hit.
CNN

“Why did they tell us to go south? Imagine a four-year-old boy telling you here is my mother and here is my aunt, (their bodies) all ripped in pieces in front of him. I covered his face and he was screaming. His aunts, and uncles, his grandfather and an uncle, no one is left,” he said.

“We were very happy. I wish I had a picture of my newborn but I don’t have any. I waited a long time to have my daughter and then her and her mom vanished together,” he said, adding that their graves were destroyed by the Israeli military just days after the family buried them.

“You take them and bury them in the cemetery and then when you go a few days later to see the cemetery, you don’t find them because they have been erased by the bulldozers. The (Israeli forces) didn’t leave anything. Even the martyrs and the bodies they have dug up. They didn’t leave a thing,” he said, looking around the destroyed neighborhood.

“We came back to the north for nothing,” he said. But he quickly added that he was determined to stay and rebuild. “I am from Gaza and I won’t leave. Even if it was harder and more difficult than this, I want to live in Gaza and I won’t leave it. I will only leave Gaza to go to Heaven,” he said.

US President Donald Trump last week suggested Gaza should be “cleaned out” by removing Palestinians living there to Jordan and Egypt — either on a temporary or permanent basis.

The comment sparked outrage and rebuke across the Middle East, with both Egypt and Jordan rejecting the idea.

“This is ingrained in our minds, we will stay. We will not leave this place, because this land is not ours but our grandparents’ and our ancestors’ before us. How am I supposed to leave it? To leave the house of my father, and grandfather and brothers?” he said.

This post appeared first on cnn.com

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Tesla investors want Elon Musk to answer questions about ‘salute,’ role in Trump White House

3 Mins Read

Tesla’s fourth-quarter earnings report lands just over a week after President Donald Trump began his second term in the White House, with Elon Musk right by his side.

Now that the Tesla CEO is firmly planted in Washington, D.C., in a high-profile advisory role, shareholders in the electric vehicle maker have some questions.

On the forum Tesla uses to solicit investor inquiries in advance of its earnings calls, more than 100 poured in from shareholders about Musk’s politics, including his official role at Trump’s Department of Government Efficiency (DOGE) and his endorsement of far-right candidates.

“How much time does Elon Musk devote to growing Tesla, solving product issues, and driving shareholder value vs. his public engagements with Trump, DOGE, and political activities?” one retail investor asked, adding, “Do you believe he’s providing Tesla the focus it needs?”

In addition to contributing $270 million to help Trump and other Republican candidates and causes, Musk spent weeks on the campaign trail during the fourth quarter working to propel Trump back into the White House. After Trump’s election victory, Musk then spent considerable time far away from Tesla’s factory floor at Trump’s Mar-a-Lago resort in Florida.

One of the top-voted questions about Musk asked how much time he intends to spend “at the White House and on government activities vs time and effort dedicated to Tesla.”

Musk and Tesla didn’t immediately respond to a request for comment.

Musk has also involved himself in German politics, giving a full-throated endorsement of the country’s far-right, anti-immigrant party AfD (Alternative für Deutschland) in December ahead of the February election.

According to research and consulting firm Brand Finance, the value of Tesla’s brand fell by 26% last year, with factors including Musk’s “antagonism,” Tesla’s aging lineup of EVs and more. The researchers found that fewer consumers would recommend or consider buying a Tesla now than in previous years.

During public remarks following last week’s inauguration, Musk repeatedly used a gesture that was viewed by many historians and politicians as a Nazi salute. Ruth Ben-Ghiat, whose scholarship has focused on fascism, described it as “a Nazi salute and a very belligerent one,” while neo-Nazis praised Musk for his antics.

A shareholder on Say asked, “Will you apologize for the misunderstanding that occurred when you made the hand gesture thanking folks for their support. It would go a long way with your investors and the American public at large. Thanking you in advance Elon!”

In response to the criticism, Musk said anyone calling the salute a hateful gesture was pushing a “hoax.” But after that, he engaged in Nazi-themed word play on X, prompting the Anti-Defamation League to rebuke him, writing it is “inappropriate and offensive to make light” of the “singularly evil” Holocaust. And Musk later appeared via video at a rally for the AfD in Halle, Germany.

Some investors asked whether Tesla had “sales lost due to political activities of Elon,” how the company plans “to respond to Musk’s now infamous Nazi salute,” and how Tesla “is addressing the negative impacts of Elon’s public views and activities.”

But Tesla is under no obligation to bring any of these topics up on the earnings call. Ahead of the third-quarter call in October, investors had a lot of questions and concerns about similar issues regarding Musk’s involvement in politics, though that was before Trump’s election victory.

Trump was never mentioned on that call.

This post appeared first on NBC NEWS

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Snowflake and Twilio Stocks are Surging: Here’s What to Do Now!

4 Mins Read

While StockCharts offers numerous tools you can use to find top stocks or top-gaining stocks, I decided to focus on an Outperforming SPY: 3-Month Relative Highs scan to see if I can find a few resilient stocks in early-stage trends, especially after Monday’s huge market rout.

FIGURE 1. THE OUTPERFORMING SPY SECTION OF THE PREDEFINED SCAN GROUP.  I went with the first scan to find stocks that outperformed SPY over three months.Image source: StockCharts.com. For educational purposes.

What I found were two cloud-based tech stocks at different trend stages: Snowflake (SNOW) and Twilio, Inc. (TWLO). It turns out that both were garnering attention on Wall Street due to their recent earnings performances:

  • SNOW surged late last year on strong financial performance and strategic AI advancements.
  • TWLO’s jump to an all-time high can be attributed to several analysts recent “buy” ratings and upward price target revisions, following the company’s strong earnings results and guidance.

Also, note that both stocks have a StockChartsTechnicalRank (SCTR) above the 90 line, indicating extreme bullishness across multiple technical indicators and timeframes.

FIGURE 2. RESULTS OF THE SCAN. When you run a scan, consider categorizing stocks by volume to list the most liquidly traded stocks from the top down.Image source: StockCharts.com. For educational purposes.

While outperforming SPY, an S&P 500 proxy, points to recent developments in the stock, it’s always good to get a bigger-picture view of relative performance. In light of this notion, take a look at a one-year chart illustrating relative performance between $SPX, SNOW, and TWLO.

FIGURE 3. PERFCHARTS RELATIVE PERFORMANCE OF SPY, SNOW, AND TWLO. This gives you a one-year perspective on the relative outperformance and underperformance of the two stocks.Chart source: StockCharts.com. For educational purposes.

This adds more depth to the comparison. It also makes you wonder if TWLO and SNOW are overvalued and undervalued, respectively, relative to the S&P 500 on a purely technical basis.

With that in mind, let’s start with a daily chart of SNOW.

FIGURE 4. DAILY CHART OF SNOW. Note the conflicting volume-based indicators. You’ll need to analyze this divergence to get a clearer set of possible interpretations.Chart source: StockCharts.com. For educational purposes.

SNOW is breaking above resistance (and its most recent swing high) at roughly $187. The nearest level of support can be found at its most recent swing low at the $153 range. Note the significant earnings-driven gap late November; a range it might retest should SNOW’s breakout fail. SNOW’s price momentum has pushed it toward the early stages of an overbought condition, as indicated by the Relative Strength Index (RSI).

If that’s relatively straightforward, the picture presented by the volume indicators is much more confusing. The On Balance Volume (OBV) indicates strong buying pressure, but the Accumulation/Distribution Line (ADL) behind the price suggests a drastic weakening in money flows. What might this mean? Here are a few possibilities:

  • Institutional distribution and false strength, or institutional sellers absorbing retail demand.
  • Rally or trend exhaustion.
  • If price holds above support, it can also indicate hidden accumulation.

Your actionable step: Add SNOW to your ChartLists and track its price movement relative to support and resistance levels. This will help you better understand its potential direction, assuming that it’s supported by momentum and volume.

Now let’s shift over to a daily chart of TWLO.

FIGURE 5. DAILY CHART OF TWLO. Strong breakaway gap, but possibly well-overbought.Chart source: StockCharts.com. For educational purposes.

TWLO experienced a parabolic jump following a breakaway gap just last week. While the OBV underscores the bullish optimism, showing strong buying pressure, the Chaikin Money Flow (CMF) signals that selling pressure is now greater than buying pressure.

Is this another case, similar to SNOW, of retail strength buying into institutional selling? Or will accumulation continue once TWLO has pulled back? After all, the RSI is signaling overbought conditions, and TWLO is well above the upper Bollinger Band.

For now, add TWLO to your ChartLists and wait for it to pull back to the middle Bollinger Band. If you’re bullish on TWLO, such a pullback would present a strong buying opportunity as long as price doesn’t fall below $105, the bottom level of the month-long congestion range.

At the Close

SNOW and TWLO have shown strong relative performance and bullish momentum, but conflicting volume indicators suggest caution. Monitoring key support and resistance levels, along with volume and momentum, will provide better clarity on their next moves. Keep them on your ChartLists and monitor them for confirmation before taking action.

Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional.

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Former al Qaeda member named as Syria’s president for transitional period

3 Mins Read

Former al Qaeda member Ahmad al-Sharaa, formerly known as Abu Mohammad al-Jolani, has been named as Syria’s president for a transitional period.

“We announce the appointment of Commander Ahmad al-Sharaa as head of state during the transitional period. He will assume the duties of the president of the Syrian Arab Republic and represent the country in international forums,” commander Hassan Abdel Ghani, spokesman for the Syria Military Operations Command, said in a statement Wednesday.

“The president is authorized to form a temporary legislative council for the transitional phase, which will carry out its duties until a permanent constitution is enacted and put into effect,” Ghani added.

The command also announced several resolutions, including the suspension of the country’s constitution, the dissolution of the country’s parliament, and the dissolution of the former regime’s army and its Baath party.

Al-Sharaa was the leader of the main militant group that spearheaded the lightning offensive that led to the overthrow last year of Syrian dictator Bashar al-Assad, whose regime had been in power for several decades.

His task now will be rebuilding a country torn apart by more than a decade of civil war that has killed more than 300,000 people and displaced millions more, according to the UN. The conflict broke out during the 2011 Arab Spring when the Assad regime suppressed a pro-democracy uprising and soon plunged into a full-scale war that pulled in other regional powers from Saudi Arabia and Iran to the United States and Russia and enabled ISIS to gain a foothold – for a while – in the country.

Shortly before he was named president, Al-Sharaa said the Assad regime had “left behind deep societal, economic, political and other wounds, and fixing them requires great wisdom, hard work and doubled effort.”

A sense of duty was what Syria “needs today more than ever,” he said.

“Just as we were determined in the past to liberate it, our duty now is to be determined to build and develop it,” Al-Sharaa added.

Who is Ahmad al-Sharaa?

Al-Sharaa became a Syrian “foreign fighter” in his early 20s, crossing into Iraq to fight the Americans when they invaded the country in the spring of 2003. That eventually landed him in the notorious US-run Iraqi prison, Camp Bucca, which became a key recruiting ground for terrorist groups, including what would become ISIS.

Freed from Camp Bucca, he crossed back into Syria and started fighting against the Baathist Assad regime, doing so with the backing of Abu Bakr al-Baghdadi, who would later become the founder of ISIS.

In Syria, he founded a militant group known as Jabhat al-Nusra (“the Victory Front” in English), which pledged allegiance to al Qaeda, but in 2016, he broke away from the terror group, according to the US Center for Naval Analyses.

Since then – unlike al Qaeda, which promoted a quixotic global holy war – Al-Sharaa’s group, now known by the initials HTS (Hayat Tahrir al-Sham), has undertaken the more prosaic job of trying to govern millions of people in the northwestern Syrian province of Idlib, providing basic services, according to the terrorism scholar Aaron Zelin who has written a book about HTS.

This post appeared first on cnn.com

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Over 3 million on Social Security may wait more than a year for higher payments

2 Mins Read

More than 3.2 million people will see increased Social Security benefits, under a new law.

However, individuals who are affected may have to wait more than a year before they see the extra money that’s due to them from the Social Security Fairness Act, the Social Security Administration said in an update on its website.

“Though SSA is helping some affected beneficiaries now, under SSA’s current budget, SSA expects that it could take more than one year to adjust benefits and pay all retroactive benefits,” the agency states.

The Social Security Fairness Act eliminates two provisions — known as the Windfall Elimination Provision and Government Pension Offset — that previously reduced Social Security benefits for certain beneficiaries who also had pension income provided from employment where they did not contribute Social Security payroll taxes.

Those provisions reduced benefits for certain workers including state teachers, firefighters and police officers; federal employees who are covered by the Civil Service Retirement System; and individuals who worked under a foreign social security system.

The law affects benefits paid after December 2023. Consequently, affected beneficiaries will receive increases to their monthly benefit checks, as well as retroactive lump sum payments for benefits payable for January 2024 and after.

The benefit increases “may vary greatly,” depending on an individual’s type of Social Security benefits and the amount of pension income they receive, according to the Social Security Administration.

“Some people’s benefits will increase very little while others may be eligible for over $1,000 more each month,” the agency states.

The Social Security Administration said it cannot yet provide an estimated timeline for when the benefit adjustments will happen.

In the meantime, the agency is advising beneficiaries to update their mailing address and bank direct deposit information, if necessary. In addition, non-covered pension recipients may now want to apply for benefits, if they are newly eligible following the enacted changes.

This post appeared first on NBC NEWS

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Investing in the Age of Tariffs: Safeguard Your Portfolio Now

6 Mins Read

Trade tariffs have been hogging the headlines since last year, and have been a sticky debate point heading into the 2024 US elections. With newly-elected US President Donald Trump in office, the fear of tariffs is front and center in investors’ minds.

On his first day in office, President Trump shied away from slapping tariffs, which provided some relief to investors and was reflected in the stock market’s price action. However, later in the day, Trump said he would impose tariffs on Canada and Mexico on February 1.

If history is any indication, tariffs have been a drag on the US economy and have had a negative impact on the stock market’s performance. As an investor, your primary goal is to protect your portfolio from large drawdowns. To achieve this goal, you’ll need to regularly monitor the stock market’s price action.

Tariff Talk

Tariffs can be both beneficial and detrimental to the overall economy. The general consensus is that they will increase the prices of imported goods, which will hurt consumers. On the other hand, they can increase domestic production and make the US economy more profitable, resulting in higher wages and increased domestic consumption.

The effects of tariffs on the US economy will take years to unravel, but the stock market reacts instantly. The lack of tariff slaps on day one of Trump 2.0 sent the broader stock market indexes higher. The S&P 500 ($SPX) closed at a new high on January 23. The Nasdaq Composite ($COMPQ) and Dow Jones Industrial Average ($INDU) are approaching their all-time highs.

The Market Overview panel on the StockCharts Dashboard gives you a bird’s eye view of equities, bonds, commodities, and cryptocurrency markets.

Learn more.

But what if President Trump indeed slaps tariffs on Mexico and Canada on February 1? Will this benefit or hurt the US economy? It could go either way, which is why investors should monitor the US’s performance relative to other countries.

Domestic or International Stocks?

The US economy is strong, corporate earnings are solid, and investors are complacent. However, the implementation of tariffs could change the narrative, which is why investors should monitor the US market’s performance relative to the rest of the world.

The chart below provides a comprehensive overview of the US market’s performance compared to the rest of the world over three years. The top panel displays the performance of the Vanguard Total World Stock ETF (VT), Vanguard Total Stock Market ETF (VTI), and Vanguard Total International Stock ETF (VXUS). The middle panel compares the US market’s performance to the world’s, and the bottom panel compares the US market to international stocks.

FIGURE 1. WEEKLY CHART OF THE US STOCK MARKET VS. THE REST OF THE WORLD. The US stock market, represented by VTI, is the outperformer, over three years.Chart source: StockCharts.com. For educational purposes.

A glance at the above chart shows US stocks are outperforming international stocks. If this reverses, then it’s time to reevaluate your portfolio and decide whether you want to allocate your assets across global stocks.

There are several international indexes and exchange-traded funds (ETFs) available in StockCharts.

A good starting point is to download the StockCharts Essentials ChartPack.

In addition to monitoring relative performance, investors should keep an eye on the US dollar. A strong dollar indicates the US economy is performing well relative to other countries. The daily chart of the US Dollar Index ($USD) shows the US dollar continues to be resilient, despite its pullback after peaking on January 13, 2025.

FIGURE 2. DAILY CHART OF US DOLLAR VS. CANADIAN DOLLAR AND MEXICAN PESO. Keep an eye on the strength of the US dollar relative to the Canadian dollar and Mexican peso.Chart source: StockCharts.com. For educational purposes.

The lower panels display the US dollar relative to the Canadian dollar and Mexican peso. As of this writing, the US dollar retains its strength, although it’s moving sideways relative to the two currencies.

Canada and Mexico could be the first countries to face tariffs. When Trump didn’t mention tariffs when he was signing executive orders, the Canadian dollar rose, but later in the day, as it was announced that Canada would be slapped with tariffs on February 1, the Canadian dollar lost ground. Monitoring the performance of the respective currencies relative to the US dollar can reveal strengths or weaknesses in the US economy.

The US is the world’s largest importer of manufactured goods. If tariffs are imposed, many sectors and industries will get caught in the trenches of the trade war, some experiencing a greater impact than others. Which sectors could get hit the hardest?

Sector Watch

Assuming Trump enforces his proposed tariffs on imports from China, Canada, and Mexico, the sectors that will bear the brunt are Technology, Materials, Industrials, and Consumer Discretionary.

Technology

Tariffs are only going to be applied to components manufactured in other countries. Semiconductor and hardware companies could be affected, but those that rely mostly on cloud services or ad revenues may not see significant changes.

Materials

The US depends on Canada and Mexico for many resources, such as aluminum, zinc, copper, and nickel. These are used to produce aircraft, home appliances, medical equipment, and home construction. Manufacturers will face higher costs if 25% tariffs are implemented.

Industrials

The US imports automobiles and light-duty motor vehicles, motor vehicle parts, heavy-duty trucks and chassis, and motor vehicle electrical and electronic equipment from Mexico and Canada. The US consumer will be faced with higher automobile prices if tariffs are implemented.

Consumer Discretionary

If tariffs don’t increase domestic production, then the US consumer will face higher prices. As a result, consumption will decline for discretionary items such as new cars, home appliances, and consumer electronics.

The PerfCharts tool in StockCharts helps you monitor which sectors are outperforming and which are underperforming. The chart below shows the performance of Technology, Materials, Industrials, and Consumer Discretionary sectors over one year.

FIGURE 3. PERFORMANCE OF TECHNOLOGY, INDUSTRIALS, MATERIALS, AND CONSUMER DISCRETIONARY SECTORS. Over the past year, Consumer Discretionary is in the lead, up 34.34%. Will it maintain its lead if tariffs are imposed?Chart source: StockCharts.com. For educational purposes.

Consumer Discretionary is leading the pack, but, if tariffs are imposed, it could lose its lead. If your portfolio is overweighted in stocks in this sector, it may be time to reallocate your assets among different sectors.

The Bottom Line

During President Trump’s first term, the stock market declined after tariffs were announced. That doesn’t mean a similar scenario will take place this time. With the uncertainty surrounding tariffs, investors need to prepare for any scenario to surface.

Be sure to follow the stock market by monitoring the broader indexes, the performance of the US market relative to the rest of the world, the US dollar’s strength, and sector performance. Staying abreast of stock market action will help you identify investor sentiment changes, which, in turn, will help position your portfolio for success.

Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional.

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Passenger plane catches fire in South Korea prompting mass evacuation, three injured

2 Mins Read

An Airbus plane belonging to South Korean carrier Air Busan caught fire on Tuesday at Gimhae International Airport in the country’s south while preparing for departure to Hong Kong, fire authorities said.

All 169 passengers and seven crew members were evacuated, with three having minor injuries, fire authorities in Busan said.

The fire service was alerted to the fire which began inside the plane just before 10:30 p.m., it said. South Korea’s Yonhap news agency said it began in the plane’s tail.

Footage aired by local broadcaster YTN shows evacuation slides deployed on both sides of the single-aisle plane, with emergency workers tackling smoke and flames from the jet.

Later footage from Yonhap news showed burned out holes along the length of the fuselage roof.

It is a month since the deadliest air disaster on South Korean soil when a Jeju Air plane coming from Bangkok crashed on Muan Airport’s runway as it made an emergency belly landing, killing all but two of the 181 people and crew members on board.

Budget airline Air Busan is part of South Korea’s Asiana Airlines, which in December was acquired by Korean Air.

Planemaker Airbus said it was aware of reports about the incident and was liaising with Air Busan.

Air Busan and Asiana did not immediately respond to requests for comment. Korean Air directed inquiries to Air Busan.

The plane is a 17-year-old Airbus A321ceo model with tail number HL7763, according to Aviation Safety Network, a respected database run by the Flight Safety Foundation.

This post appeared first on cnn.com

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DeepSeek hit with large-scale cyberattack, says it’s limiting registrations

3 Mins Read

DeepSeek on Monday said it would temporarily limit user registrations “due to large-scale malicious attacks” on its services, though existing users will be able to log in as usual.

The Chinese artificial intelligence startup has generated a lot of buzz in recent weeks as a fast-growing rival to OpenAI’s ChatGPT, Google’s Gemini and other leading AI tools.

Earlier on Monday, DeepSeek took over rival OpenAI’s coveted spot as the most-downloaded free app in the U.S. on Apple’s App Store, dethroning ChatGPT for DeepSeek’s own AI Assistant. It helped inspire a significant selloff in global tech stocks.

Buzz about the company, which was founded in 2023 and released its R1 model last week, has spread to tech analysts, investors and developers, who say that the hype — and ensuing fear of falling behind in the ever-changing AI hype cycle — may be warranted. Especially in the era of the generative AI arms race, where tech giants and startups alike are racing to ensure they don’t fall behind in a market predicted to top $1 trillion in revenue within a decade.

DeepSeek reportedly grew out of a Chinese hedge fund’s AI research unit in April 2023 to focus on large language models and reaching artificial general intelligence, or AGI — a branch of AI that equals or surpasses human intellect on a wide range of tasks, which OpenAI and its rivals say they’re fast pursuing.

The buzz around DeepSeek especially began to spread last week, when the startup released R1, its reasoning model that rivals OpenAI’s o1. It’s open-source, meaning that any AI developer can use it, and has rocketed to the top of app stores and industry leaderboards, with users praising its performance and reasoning capabilities.

The startup’s models were notably built despite the U.S. curbing chip exports to China three times in three years. Estimates differ on exactly how much DeepSeek’s R1 costs, or how many GPUs went into it. Jefferies analysts estimated that a recent version had a “training cost of only US$5.6m (assuming US$2/H800 hour rental cost). That is less than 10% of the cost of Meta’s Llama.”

But regardless of the specific numbers, reports agree that the model was developed at a fraction of the cost of rival models by OpenAI, Anthropic, Google and others.

As a result, the AI sector is awash with questions, including whether the industry’s increasing number of astronomical funding rounds and billion-dollar valuations is necessary — and whether a bubble is about to burst.

This post appeared first on NBC NEWS

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