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  • 💎 This Investor Is Sitting on 300 Billion

💎 This Investor Is Sitting on 300 Billion

+ Palantir Reports Record Profit, Cites ‘Unwavering’ AI Demand

November 04, 2024

Good afternoon! American voters are finally nearing the finish line after weeks of relentless ads, donation texts, and a news cycle that’s been anything but calm. But with a new administration on the horizon, the big question is: what does it mean for your portfolio?

Analysts suggest a Kamala Harris presidency could lift sectors like clean energy, healthcare, and homebuilders, while a Trump administration would likely favor industries like crypto, financials, and traditional energy. Despite the temptation to play the “election trade,” experts remind us that politics is just one slice of the pie. In the end, staying diversified through any administration is often the smarter, long-term move.

MARKETS

*Stock data as of market close*

  • Stocks took a tumble on Monday, as pre-election jitters and a possible Fed rate cut had investors in a frenzy. All three major indexes danced up and down before closing in the red—Dow down 257 points (0.61%), while the S&P 500 and Nasdaq slipped 0.28% and 0.33%.

  • It was a choppy day all around, as investors braced for a wild week of market-moving events. With the election and Fed’s decision on deck, it’s safe to say the market rollercoaster is far from over.

STOCKS
Winners & Losers

What’s up 📈

  • Globalstar surged 31.88% after Apple committed approximately $1.5 billion to support its satellite communication expansion for iPhone services. ($GSAT)

  • Chewy rose 6.34% after S&P Dow Jones Indices announced that it would replace Stericycle in the S&P MidCap 400, effective Wednesday. ($CHWY)

  • Sherwin-Williams increased 4.59% as its addition to the Dow boosted the materials sector weighting, while the technology sector’s influence in the Dow also shifted. ($SHW)

  • Peloton climbed 3.59% following an upgrade to “buy” from “underperform” by Bank of America, which is optimistic about earnings growth under new CEO Peter Stern. ($PTON)

  • Exxon Mobil rose 3.18% despite reporting Q3 earnings of $8.61 billion, down 4.4% year-over-year, as production reached a 40-year high of 4.6 million barrels per day. ($XOM)

  • eBay gained 3.65%. ($EBAY)

  • First Solar ticked up 3.58%. ($FSLR)

What’s down 📉

  • Constellation Energy dropped 12.46% as the Federal Energy Regulatory Commission rejected Talen Energy's request to boost power output from the Susquehanna nuclear plant for an Amazon data center. The market anticipated similar deals from Constellation and Vistra, contributing to the decline. ($CEG)

  • New York Times fell 7.71% after reporting fewer-than-expected digital subscriber gains in Q3, despite strong growth in digital ad sales. Additionally, the New York Times Tech Guild launched an unfair labor practice strike. ($NYT)

  • American Airlines slipped 4.06% as the U.S. Department of Transportation enacted new refund rules for passengers facing cancellations or major delays. Additionally, CEO Robert Isom plans to sell up to 150,000 shares in the coming months. ($AAL)

  • Sirius XM dipped 6.22%. ($SIRI)

  • Chipotle Mexican Grill declined 3.77%. ($CMG)

  • Loews fell 3.48%. ($L)

  • Reddit dropped 3.50%. ($RDDT)

  • Snap Inc. slid 3.27%. ($SNAP)

FINANCE
Berkshire Hathaway’s Cash Fortress Tops $300 Billion

Warren Buffett’s cash stash at Berkshire Hathaway is looking more like a cash fortress, ballooning to a record-breaking $325 billion.

It’s a fortune even Buffett isn’t sure how to spend, as he keeps dodging big-ticket buys and instead cashes out on old faves like Apple and Bank of America. Why the hoarding? Some say he’s just too seasoned to overpay in today’s market; others think he’s plotting something big.

Either way, he’s showing us what real self-control looks like.

Apple on a Diet, Cash on a Bulk-Up

Buffett trimmed Berkshire’s Apple stake by another 25% this quarter, whittling it down to $69.9 billion. Even though the iPhone maker still holds the crown as Berkshire’s biggest holding, it’s clear Buffett’s leaning out the tech exposure.

The kicker? This isn’t a tech-love breakup, just a careful rebalancing to make sure Apple doesn’t end up becoming the whole show.

Buybacks? Not This Time

Usually, Buffett’s all about scooping up his own shares when Berkshire’s cash pile is high, but this quarter, buybacks took a timeout. And that’s surprising, given Berkshire’s been on a 25% winning streak this year.

Analysts speculate he’s holding out for the really right moment to jump back in—because why not, when cash is stacking up faster than Wall Street can blink?

Cash-Burning Dreams: So, what’s next for Buffett’s billions? Will he finally splurge on something big, like a mega-acquisition? Or is he playing the long game, waiting for stock prices to cool off before making any serious moves? One thing’s clear: the Oracle of Omaha knows patience is a virtue—and he’s got the cash mountain to prove it.

NEWS
Market Movements

  • 📡 Apple Commits $1.5B to Globalstar for Satellite Expansion: Apple has invested $1.5 billion into Globalstar to expand iPhone satellite services, including a $1.1 billion cash commitment and a 20% equity stake, prompting Globalstar’s stock to jump over 30%. ($AAPL, $GSAT)

  • ✈️ Boeing Machinists Vote on New Contract: Today, Boeing’s 32,000 machinists are casting their votes on a newly proposed contract, which includes a 38% wage increase over the next four years—a substantial boost following previous offers that were turned down. ($BA)

  • 🇨🇳 Tesla’s China Sales Dip as Model Deliveries Slow: Tesla reported a 5.3% drop in sales of its China-made electric vehicles for October, with the monthly deliveries of Model 3 and Model Y down 22.7%, signaling a cooling demand in a key EV market. ($TSLA)

  • 🇪🇺 EU to Review Apple’s Compliance with New Digital Markets Act: The European Union will evaluate whether Apple’s iPad OS aligns with the Digital Markets Act, which could require Apple to offer users a choice in default browsers and allow access to third-party app stores. ($AAPL)

  • 🍟 Wendy’s to Close 140 Locations with Plans for New Openings: Wendy’s has announced it will close 140 underperforming locations but plans to open a similar number of new restaurants in stronger markets as part of a larger strategy to modernize and grow. ($WEN)

  • ⚖️ Meta and Nvidia Appeal Securities Fraud Cases to Supreme Court: Meta and Nvidia are petitioning the U.S. Supreme Court to dismiss securities fraud cases against them, arguing that recent rulings limiting regulatory powers could set new legal precedents for investor lawsuits. ($META, $NVDA)

  • 📉 Investors Shift to Bonds as Stock Market Caution Increases: U.S. equity funds saw $5.83 billion in outflows this past week as investors adopt a more cautious stance ahead of the election and the Federal Reserve’s upcoming policy decision, while bond funds gained a strong $7.37 billion in inflows.

EARNINGS
Palantir Reports Record Profit, Cites ‘Unwavering’ AI Demand

Palantir just dropped a knockout earnings report, sending its stock up 15% after hours. Revenue shot up 30% in Q3 to $725.5 million, leaving analysts' forecasts in the dust. But the real kicker?

Demand for Palantir’s AI tech in the U.S. is off the charts, setting the company up for a stellar year with a new revenue target of nearly $2.81 billion.

The U.S. Appetite for AI

Business is booming stateside, with commercial revenue up 54% and government revenue climbing 40% year-over-year. CEO Alex Karp didn’t hold back, describing this as “unwavering demand” that’s positioning Palantir front and center in an AI-powered revolution.

The U.S. government’s appetite for advanced data tools is a big driver, making Palantir’s AI solutions essential for organizations seeking smarter, more efficient operations.

Boosted Guidance Lights Up Investors

With a solid quarter under its belt, Palantir has raised its guidance, now expecting full-year revenue to land between $2.805 and $2.809 billion—well above Wall Street’s estimates.

Q4’s forecast looks equally strong, with revenue projected as high as $771 million. Given AI’s moment in the spotlight, investors are betting on Palantir’s long-term potential in this high-stakes arena.

Global Hiccups, U.S. Dominance

While the U.S. powers Palantir’s growth, international sales are a mixed bag, particularly in Europe, where commercial revenue slipped this quarter. Yet Karp remains optimistic, seeing the U.S. as the core of Palantir’s AI growth.

As these tools become integral across industries, Palantir’s strong domestic foothold could keep it leading the pack, even as it navigates a few global bumps.

Calendar
On The Horizon

Tomorrow

Two economic reports are due tomorrow—the ISM Services Index and a snapshot of the U.S. Trade Deficit. But, let’s face it, neither will come close to stealing the spotlight from the presidential election.

Election night means noise, lots of it. And with every update and needle movement, it’s tempting to hit the panic button. But seasoned investors know the real trick: tuning out the chaos and sticking to their strategy.

Here’s the game plan—keep calm, keep steady. The ones who make it big aren’t the ones glued to every election twist but those who play the long game, staying true to their plan no matter what.

Before Market Open:

  • Ferrari has been cruising on pure brand power. While most of the luxury market is slowing down, Ferrari’s ultra-wealthy customers barely feel the pinch, happily shelling out for a supercar that hits 0-60 in just 2.4 seconds. With a waiting list that stretches well into the future, Ferrari’s got smooth sailing for months, and management will likely be popping the champagne tomorrow to toast another year of market-beating gains. Consensus: $2.19 EPS, $1.79 billion in revenue. ($RACE)

After Market Close:

  • Meanwhile, Super Micro Computer has found itself in hot water. A damning short-seller report, a DOJ investigation, and the sudden exit of its independent auditor have all hit within weeks. Investors are expecting answers in tomorrow's earnings call, but clarity? That might be harder to come by. Consensus: at this point, who really knows? ($SMCI)

NEWS
The Daily Rundown

  • 🍔 TGI Fridays Files for Bankruptcy Amid Pandemic Struggles: Once a cultural icon, TGI Fridays has filed for Chapter 11 bankruptcy protection, joining a growing list of casual dining chains that have struggled to rebound from pandemic losses and shifting consumer spending habits.

  • 🗳️ Early Voting Hits New Heights as Nearly Half of Electorate Casts Ballots: Early voting for the 2024 election is up significantly, with 48% of the total 2020 electorate already having cast their ballots—an indication that the shift to early and mail-in voting is likely here to stay.

  • 📉 Fed Expected to Cut Rates Despite Labor Market Cooling Signs: The Fed is anticipated to lower interest rates this Thursday following a recent jobs report hinting at a softer labor market, but future rate moves remain uncertain with the election just around the corner.

  • 🌊 Spanish leaders face flood protests: Spanish leaders, including King Felipe, were met with protests and chants of "murderers" during their visit to a city devastated by deadly floods last week. Public anger is growing over the government’s response to the flooding that has claimed at least 217 lives.

  • 💸 Political ad spending soars: Nearly $1 billion has been spent on political ads in just the past week, AdImpact reports, as Election Day nears and campaigns ramp up their final pushes.

  • 🗳️ Election Day scenarios: Here are the seven most likely scenarios shaping up for Election Day, highlighting potential outcomes in this year’s tightly contested races.

  • 🎄 Mariah Carey rings in the season: Mariah Carey has once again declared, "It’s time." Her holiday classic "All I Want for Christmas Is You" is celebrating its 30th anniversary this fall, as it returns to top holiday playlists worldwide.

RESOURCES
The Federal Reserve Resource

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