📈 Palantir Crashes After Record Earnings

Good Morning & Happy Wednesday.

Today’s lineup is packed, from stocks sliding after Palantir’s surprise drop to Tesla’s $1 trillion pay showdown, and even Amazon’s legal fight with Perplexity’s AI bot. We’ll also break down why “Sell in May” still won’t die, lessons from Goldman’s global portfolio, and which hypergrowth stocks might be worth buying right now.

Grab you Flat White and let’s get into it! ☕️ 

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Market News

🧨 Stock Indexes End Sharply Lower
Stocks sank Tuesday, with the Nasdaq down 2% and Palantir plunging 8% despite posting strong earnings and raising its outlook. Tech heavyweights like AMD, Nvidia, Intel, and Tesla also dropped, dragging the S&P 500 and Dow lower. Cruise lines tumbled after Norwegian fell 15%, while Hertz soared 36% and Denny’s jumped 50% on a $620 million buyout. Bitcoin briefly dipped below $100K, while gold slid 1.6%, oil fell 1.7%, and Treasury yields eased to 4.09%.

📉 Don't panic yet, investors say, as high-flying AI stocks tumble
Global stocks slipped from record highs, with analysts calling the drop “healthy” profit-taking rather than a panic signal. Wall Street execs cautioned about a possible pullback as tech-led selling continued into a second day. Markets in Seoul and Tokyo fell about 5% from recent peaks, while Nasdaq futures dipped 0.2% after Tuesday’s 2% drop.

👇️ AMD Crushes Q3 — But Why’s the Stock Falling?
AMD beat Q3 expectations, posting $1.20 EPS on $9.25B in revenue, topping forecasts of $1.17 and $8.74B. It also issued a strong Q4 outlook, guiding revenue between $9.3B and $9.9B, above Wall Street’s $9.21B target. CEO Lisa Su called it a “record quarter” driven by demand for EPYC, Ryzen, and Instinct AI chips. Despite the upbeat report, shares fell up to 4% premarket Wednesday. So why did the stock fall?

😅 SoftBank shares plunge 10%, wiping $23 billion in market cap
SoftBank shares tumbled 10% Wednesday, shedding $23 billion in market cap as the broader AI sector faced heavy selling amid fears of overvaluation. It marked the group’s worst day since April, despite a strong AI portfolio including Arm Holdings, which also fell 4.7% overnight. Investors are growing cautious as the AI trade becomes increasingly crowded.

🏢 Trump’s Tariff Powers Face the Court
The Supreme Court is set to hear a pivotal tariff case Wednesday, challenging the authority former President Trump used to impose major tariffs. Experts see the outcome as a true toss-up, with some giving just 50–65% odds the Court will limit presidential power. The case, Learning Resources v. Trump, has drawn intense scrutiny due to Trump’s personal stake and a mounting White House pressure campaign.

This week in Tech

💰️ Elon Musk's $1 trillion pay fight
Tesla’s trillion-dollar showdown is set for Thursday, with Elon Musk’s massive pay package taking center stage at the annual meeting in Austin. Norway’s $1.9T wealth fund, a key shareholder, plans to vote against the $1T payout, citing concerns over size, dilution, and key person risk. While Musk’s leadership is praised, the vote is shaping up to be a major flashpoint for investors.

💼 Amazon sends legal threats to Perplexity over agentic browsing
Amazon has issued a cease-and-desist to Perplexity, demanding the startup remove its AI shopping assistant, Comet, from interacting with Amazon’s site. Perplexity fired back, calling the move “bullying” and arguing Comet acts on users’ behalf and shouldn’t need to self-identify. Amazon disagrees, pointing out that other third-party agents disclose themselves. The standoff highlights growing tension as Amazon protects its turf—and its Rufus AI bot—from rising AI intermediaries.

🪖 Fund manager sends message on latest Palantir earnings
Palantir posted blowout Q3 results, with CEO Alex Karp touting 121% U.S. commercial growth and calling the company’s AI transformation “undeniable.” Revenue guidance for Q4 hit a record, and full-year projections were raised again, now topping $4.4B. Zacks Investment’s Brian Mulberry praised the momentum, while Karp took a swipe at critics, saying they’re trapped in “deranged and self-destructive befuddlement.”

🕹️ Studio Ghibli, Bandai Namco, Square Enix demand OpenAI stop using their content to train AI
Japan’s top anti-piracy group, CODA, is demanding OpenAI stop using Japanese IP to train its models, specifically targeting Sora 2 for generating content resembling Studio Ghibli and Bandai Namco works. CODA argues this may violate copyright law, and the Japanese government has backed the call. Sora 2’s September launch triggered a wave of anime-style output, echoing past concerns, including GPT-4o’s Ghibli-inspired visuals and even Sam Altman’s profile pic.

Invest & Strategies

🤔 Should You Buy at All-Time Highs?
Buying at all-time highs might feel risky, but the data says otherwise, according to Nick Maggiulli. Historically, returns don’t suffer just because you're buying at a peak, in fact, emerging markets, gold, and Bitcoin often perform better in the short term after new highs. For U.S. stocks, the long-term impact is negligible, and market timing doesn’t work. So if you’re worried? “Sin a little,” rebalance, and Just Keep Buying.

🥈 2 Hypergrowth Tech Stocks to Buy in 2025
Palantir and Applied Digital are riding the hypergrowth wave, each posting revenue growth over 40% and showing no signs of slowing. Palantir’s Q2 revenue jumped 48%, marking its eighth straight quarter of acceleration. Meanwhile, Applied Digital is capitalizing on the AI power crunch, leveraging its roots in crypto mining to offer AI-ready data centers and GPU rentals, with major clients like CoreWeave locking in $11B+ in contracts.

📆 The 1950s Boom That Proved Not Every Bull Ends in a Crash
The 1950s bull market was one of the strongest in U.S. history, yet it rarely gets mentioned. Stocks soared nearly 20% annually, with massive gains in years like 1954 (+52.6%) and 1958 (+43.7%), all while investor sentiment lagged due to post-Depression scars. Unlike other melt-ups, this bull run ended quietly, with no devastating crash, just a transition into the more modest, but still positive, 1960s.

👀 5 Lessons for Investors from the Global Market Portfolio
Goldman Sachs’ “Investing in Everything, Everywhere, All at Once” report maps the evolving global market portfolio, showing how asset mix trends shift over time. Tech now dominates U.S. equities, while nontraditional assets like gold, crypto, and private markets are gaining ground. Though tactical shifts can boost returns in theory, most investors underperform by trying to time asset mix changes. The report ultimately reinforces that diversification matters, but timing is nearly impossible to get right.

💸 “Sell in May and Go Away” Refuses to Die
“Sell in May and go away” refuses to die, but as Larry Swedroe points out, the data doesn't back it up. While returns from November to April do outperform, the May-to-October period still beats cash on average. In 2025, for example, Vanguard’s S&P 500 ETF returned 27.3%, crushing T-bills. The myth lives on because it's catchy, not because it's profitable. The smarter move? Stay invested.