Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Semi Equipment Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Return to Sender who wrote (94508)	6/6/2025 11:33:42 PM
From: Return to Sender	1 Recommendation Recommended By Julius Wong Read Replies (1) \| Respond to of 95342

From Briefing.com: The Big Picture Last Updated: 06-Jun-25 18:04 ET \| Archive May jobs report eases economic fears Column Summary: Labor market remains resilient; unemployment and wage growth support continued economic growth. The May jobs report eased fears of economic recession. * A resilient labor market reduces the probability of imminent Federal Reserve rate cuts. Nonfarm payroll growth may be slowing, but it isn't declining. Average hourly earnings growth may be slowing, but on an inflation-adjusted basis, it is still positive. The unemployment rate may be up from a multi-decade low of 3.4%, but at 4.2%, it is still historically low. The labor market, overall, may not be quite as strong as it once was, but it remains strong enough to lend confidence to the idea that the economy has enough labor market footing to remain on a growth trajectory. Some Shortcomings The May Employment Situation Report, to be fair, wasn't completely above reproach. Some of its shortcomings include the following: With the revisions, employment in March and April combined was 95,000 lower than previously reported. The number of people working part-time for economic reasons (i.e., due to slack work or business conditions or could only find part-time work) was 4.624 million. While that was down from 4.690 million in April, it was up from 4.415 million in the same period a year ago. Employment in the temporary help services industry declined by 20,300. The vast majority of the nonfarm payrolls increase in May was driven by two industries: health care and social assistance (+78,300) and leisure and hospitality (+48,000). With a report as comprehensive as the employment report, there will always be room to find some negatives in it. On balance, the May report was as good as the stock market could have hoped for at the time it was released -- and we don't mean 8:30 a.m. ET. We mean on the heels of an ADP Employment Report that showed only 37,000 jobs added to private-sector payrolls in May. We mean in the wake of an ISM Services PMI reading for May that showed only its fourth contractionary reading (49.9%) in the last 60 months. We mean in the midst of the U.S.-China trade uncertainty. We mean in the middle of argumentative negotiations over the reconciliation bill. There was plenty that could have upended the labor market in May, but for the most part, the labor market stood its ground. That is an extremely important variable in assessing the economic outlook. A Jobs Report That Fits the Bill If people are gainfully employed, they will be spending money. This is a point we have made often, and it continues to be supported by the data, although the latest Personal Income and Spending Report for April did show some guarded spending activity. With personal income up 0.8%, personal spending rose only 0.2% following a 0.7% increase in March. There was a lot going on in April to deter spending activity, not the least of which was all the tariff upset that spawned talk of a possible recession for the U.S. economy. That talk was tempered by the subsequent tariff pause announcement and the massive recovery rally that pause ignited, but it was really tempered by the arrival of hard economic data that showed resilience in the economy and activity that belied the ugly sentiment readings seen in the soft data. Ironically, the April employment report was one of those hard data releases, and now the May employment report also fits that bill. Some might take exception to that characterization given the softening stature of nonfarm payrolls, but the Treasury market didn't appear to take exception to that view. If anything, it recoiled somewhat at the thought of the economy and average hourly earnings growth being better than feared. Maturities from the 2-yr note to the 10-yr note all moved up at least 11 basis points following the release of the May employment report, the resilient nature of which cast some doubt on the timing of the Fed's next rate cut. The move took the 2-yr note yield to 4.04% and the 10-yr note yield to 4.51%. According to the CME FedWatch Tool, the probability of a 25 basis point rate cut to 4.00-4.25% at the July FOMC meeting has been reduced to 16.5% from 31.5%, while the probability of a 25 basis point cut to 4.00-4.25% at the September FOMC meeting has been trimmed to 62.4% from 73.9% the day before the report. Briefing.com Analyst Insight The May Employment Situation Report easily surpassed the market's worst fears. It wasn't strong, but it was good nonetheless, and good is good enough right now for a market that is watching the hard data with an eagle eye to determine if it is showing some worrisome deterioration because of the policy uncertainty. This report didn't suggest as much. Instead, this important body of hard economic data indicated that, overall, the economy is still on solid footing despite the volatility of the stock market and the tariff uncertainty. The most important takeaway is that the combination of the low unemployment rate and higher-than-expected average hourly earnings growth, which follows a robust 0.8% increase in personal income in April, will keep consumers on a spending path and the economy on a growth trajectory. Notwithstanding the fact that this report should also keep any rate cut by the Fed on hold, this is a report that the stock market should have been cheering because it is a good economic report that is better for earnings prospects than a truly bad report would be. -- Patrick J. O'Hare, Briefing.com (Editor's Note: The next installment of The Big Picture will be published the week of June 23.)

To: Return to Sender who wrote (94508)

6/9/2025 11:27:53 PM

From: Return to Sender

2 Recommendations

Recommended By
Julius Wong
kckip

Read Replies (1) | Respond to of 95342

Market Snapshot

Dow	42761.76	-1.11	(0.00%)
Nasdaq	19591.21	+61.28	(0.31%)
SP 500	6005.88	+5.52	(0.09%)
10-yr Note	+8/32	4.482

NYSE	Adv 1720	Dec 983	Vol 1.03 bln
Nasdaq	Adv 2720	Dec 1705	Vol 9.58 bln

Industry Watch

Strong: Communication Services, Materials, Information Technology, Energy, Consumer Discretionary

Weak: Financials

Moving the Market

-- Waiting on developments out of U.S.-China trade talks in London

-- Strength in semiconductors

-- Ongoing strength in small-cap stocks

Subdued start to new week
09-Jun-25 16:20 ET

Dow -1.11 at 42761.76, Nasdaq +61.28 at 19591.21, S&P +5.52 at 6005.88
[BRIEFING.COM] The stock market began the week on a slightly higher note with modest gains in the S&P 500 (+0.1%) and Nasdaq (+0.3%) while small caps outperformed throughout the day, sending the Russell 2000 higher by 0.7%.

The Monday session started with some guarded optimism surrounding trade talks between officials from U.S. and China. The market was eager to hear some news from the discussions in London, especially after NEC Director Hassett said that he does not expect a long meeting, but he expects a handshake agreement pertaining to rare earth elements. However, the day went by with no meaningful updates, other than a Fox Business report that talks will continue tomorrow after today's meeting lasted nearly seven hours. President Trump chimed in shortly before the close, saying he expects an update later this evening, which invited some profit taking that sent the major averages back toward their opening levels.

China was also in the spotlight overnight, when it reported more deflationary CPI and PPI readings for May, which are sending a poor signal about the country's pace of growth. Separately, China's Trade Balance report for May showed that exports to the U.S. dropped by more than 1/3.

Five sectors finished the day in positive territory after overcoming some early softness. The consumer discretionary sector (+1.1%) ended in the lead, seizing the top spot from the technology sector (+0.3%), which started in the lead, but finished just ahead of the broader market.

The discretionary sector received notable help from its two largest components, as Tesla (TSLA 308.55, +13.44, +4.6%) bounced back above its 50-day moving average (292.61) after last week's poor showing while Amazon (AMZN 216.98, +3.41, +1.6%) reached its best level since late February.

Technology was boosted by chipmakers with the PHLX Semiconductor Index (+2.0%) defending the bulk of its gain into the close even though chip giant NVIDIA (NVDA 142.63, +0.91, +0.6%) gave back a large chunk of its early advance that followed CEO Huang's opening keynote speech at London Tech Week. Qualcomm (QCOM 155.41, +6.17, +4.1%) was a notable outperformed among chip stocks, as it rallied to levels not seen since late March after announcing a $2.4 bln acquisition of Alphawave.

Elsewhere in technology, Apple (AAPL 201.45, -2.47, -1.2%) contributed to the intraday slip from highs after the company presented at its Worldwide Developers Conference, but only unveiled cosmetic software updates.

Economic data released today was limited to the Wholesale Inventories report for April (0.2%; Briefing.com consensus 0.0%; prior 0.4%), but things should get more exciting on that front in a couple days when the market receives the CPI report for May (Briefing.com consensus 0.2%; prior 0.2%).

Treasuries finished with gains across the curve that were paced by the short end. The 2-yr yield fell four basis points to 4.00% while the 30-yr yield dipped one basis point to 4.95% with help from an intraday release of the May Survey of Consumer Expectations from the New York Fed, which showed a drop in year-ahead inflation expectations to 3.2% from 3.6%. The three-year outlook decreased to 3.0% from 3.2% while the five-year outlook dipped to 2.6% from 2.7%.

Tomorrow's data will be limited to the 6:00 ET release of the NFIB Small Business Optimism Index for May (prior 95.8).

S&P 500 +2.1% YTD
Nasdaq Composite +1.5% YTD
Dow Jones Industrial Average +0.5% YTD
S&P Midcap 400 -2.0% YTD
Russell 2000 -3.8% YTD

Still waiting
09-Jun-25 15:25 ET

Dow +71.82 at 42834.69, Nasdaq +81.01 at 19610.94, S&P +13.55 at 6013.91
[BRIEFING.COM] The major averages are hanging onto their gains going into the home stretch of today's session.

The trading day started with some anticipation related to trade talks between representatives from the U.S. and China, but it is now set to end without any noteworthy updates from the meeting in London, other than a report from Fox Business that the conversation will continue tomorrow.

Treasuries finished their session on highs with the 2-yr note maintaining its lead throughout the day, sending its yield lower by four basis points to 4.00% while the 30-yr yield slipped one basis point to 4.95% after starting the day in negative territory.

Drifting near highs
09-Jun-25 15:00 ET

Dow +106.15 at 42869.02, Nasdaq +97.67 at 19627.60, S&P +20.20 at 6020.56
[BRIEFING.COM] The major averages hover near their best levels of the day with the Nasdaq (+0.5%) maintaining its lead over the S&P 500 (+0.3%).

The market started the week with strong support from the technology sector (+0.4%), but the top-weighted group has given back more than half of its initial gain. However, the dip from highs in the technology sector has come alongside gains in other groups, which has kept the major averages in positive territory.

Investors received just one economic report today—April Wholesale Inventories (0.2%; Briefing.com consensus 0.4%)—and tomorrow's session will also see just one release. However, Wednesday will bring the May CPI report (Briefing.com consensus 0.2%; prior 0.2%), which is sure to receive increased attention as the market tries to guess the timing of the next rate cut from the FOMC.

S&P 500 up; ON Semiconductor and Enphase rally, Edison falls on downgrade
09-Jun-25 14:30 ET

Dow +122.73 at 42885.60, Nasdaq +89.02 at 19618.95, S&P +19.65 at 6020.01
[BRIEFING.COM] The S&P 500 (+0.33%) is in second place on Monday afternoon.

Briefly, S&P 500 constituents Enphase Energy (ENPH 44.14, +2.96, +7.19%), Albemarle (ALB 63.06, +3.23, +5.40%), and onsemi (ON 52.62, +2.45, +4.88%) pepper the top of the standings. ON rises as Citigroup's channel checks revealed no semiconductor slowdown, with strong demand and low inventories supporting upside potential later in 2025. Investors are optimistic about earnings upgrades for ON and peers like TXN and MCHP amid improving industry conditions.

Meanwhile, Edison (EIX 49.31, -4.45, -8.28%) slides to the bottom of the average after being downgraded to Peer Perform out of Wolfe Research amid wildfire liability and regulatory uncertainty.

Gold gains as dollar slips, trade talks lift safe-haven appeal
09-Jun-25 14:00 ET

Dow +120.04 at 42882.91, Nasdaq +89.89 at 19619.82, S&P +19.93 at 6020.29
[BRIEFING.COM] With about two hours to go on Monday the tech-heavy Nasdaq Composite (+0.46%) is the top-performing major average.

Gold futures settled $8.30 higher (+0.2%) at $3,354.90/oz, as investor focus sharpened on U.S./China trade developments and a softer U.S. dollar. Heightened expectations for a positive tone from high-level trade talks in London -- with officials from both sides meeting on Monday -- lent support to bullion as a safe-haven asset. At the same time, modest dollar weakness made gold more attractive to non-dollar buyers.

Meanwhile, the U.S. Dollar Index is down about -0.2% to $98.96.

Qualcomm bolsters data center ambitions with $2.4 bln acquisition of Alphawave (QCOM)
Before the open, Qualcomm (QCOM) announced a $2.4 bln acquisition of Alphawave IP Group, a UK-based semiconductor company, with the transaction expected to close in 1Q26. Alphawave specializes in high-speed wired connectivity and compute technologies, delivering intellectual property, custom silicon, connectivity products, and chiplets that enable faster, more reliable data transfer with high performance and low power consumption. Its serializer/deserializer technology, critical for AI-driven data processing, supports high-speed data movement in data centers, networking, and storage applications, underpinning the custom chip businesses of companies like Broadcom (AVGO) and Marvell Technology (MRVL).

Alphawave's capabilities complement QCOM’s portfolio, particularly its Oryon CPU and Hexagon NPU processors, enhancing its ability to deliver power-efficient, high-performance computing solutions for AI and data center workloads.
QCOM's pivot to diversify revenue streams beyond the seasonal and volatile handset market has been a cornerstone of its recent growth, as evidenced by its strong 2Q25 results announced on April 30, where Automotive revenue surged 59% yr/yr and IoT revenue grew 27% yr/yr. The acquisition of Alphawave represents a continuation of this strategy, following moves like the 2021 acquisition of Nuvia to bolster custom ARM-based CPU designs.
By integrating Alphawave’s connectivity IP, QCOM strengthens its technological foundation in high-growth sectors like data centers and AI, reducing reliance on smartphone chips - a market facing low single-digit growth projections through 2029 - and challenges like Apple’s (AAPL) shift to in-house modems. This diversification aligns with QCOM’s broader push into automotive, IoT, and AI-enabled PCs.
The acquisition significantly expands QCOM’s footprint in the data center market, an area where it previously had limited exposure after exiting in 2018 due to challenges competing with Intel (INTC). The explosive growth in AI-driven workloads has fueled robust demand for data center processors, as demonstrated by NVDA’s dominance in AI GPUs and AMD’s strong growth in EPYC server CPUs, with both companies capitalizing on a data center CPU total addressable market projected to grow at a 10% CAGR and an AI inference market expanding at over 20% CAGR through 2027.
Alphawave’s high-speed connectivity IP enhances QCOM’s ability to deliver integrated solutions for AI infrastructure, complementing its Nuvia-derived CPU capabilities. While this positions QCOM to compete in the data center space, it poses limited immediate competitive risk to NVDA, AMD, or INTC. NVDA's strength lies in its GPU-centric AI ecosystem, while AMD and INTC dominate server CPUs. QCOM’s focus on connectivity and custom silicon targets a complementary niche, potentially enabling partnerships rather than direct competition.
Financially, the acquisition is unlikely to provide a material near-term boost to QCOM’s performance, given Alphawave’s ~$300 mln in 2024 revenue compared to QCOM’s $24 bln from mobile chips alone in FY24. However, long-term benefits are more significant. Alphawave’s IP and custom silicon capabilities enhance QCOM’s ability to capture a share of the $39 bln data center TAM by 2027, while synergies from combining Alphawave’s connectivity with QCOM’s processors could improve margins and accelerate growth in AI and data center markets.

QCOM’s $2.4 bln acquisition of Alphawave is a strategic move to bolster its data center and AI capabilities, aligning with its diversification strategy to reduce handset market dependence. While near-term financial impacts are modest, the long-term potential to capture high-growth data center markets and enhance technological competitiveness justifies the investment, positioning QCOM as a stronger player in AI infrastructure.

Warner Bros. Discovery higher on separation news as WBD navigates a changing media landscape (WBD)

Warner Bros. Discovery (WBD +8%) is trading nicely higher today as investors cheer the struggling media company's decision to separate the company into two publicly traded companies.

On the one hand will be its Streaming & Studios company, which will consist of Warner Bros. Television, Warner Bros. Motion Picture Group, DC Studios, HBO, and HBO Max, as well as their film and television libraries. David Zaslav, currently CEO of Warner Bros. Discovery, will serve as CEO of Streaming & Studios.
On the other hand will be Global Networks, which will include CNN, TNT Sports in the US, and Discovery, top free-to-air channels across Europe, and digital products such as the Discovery+ streaming service and Bleacher Report (B/R). Gunnar Wiedenfels, CFO of Warner Bros. Discovery, will serve as CEO of Global Networks.
WBD believes that, by operating as two distinct companies, each will be able to focus on their individual goals and strategies. This will also allow each company to pursue important investment opportunities. WBD feels a separation will allow each company to act faster and be more aggressive in terms of pursuing opportunities. Also, the separation will allow investors to assign different multiples to each company.

This a trend we are seeing in legacy media as it deals with increasing competition from streaming and as consumers move away from traditional cable/linear tv. This WBD separation is very similar to what Comcast (CMCSA) is doing in terms of spinning out its cable networks, to be called Versant, from NBCUniversal by year end. Also, Lions Gate Entertainment (LGF.A) recently completed the separation of its Studio and STARZ businesses into two publicly-traded companies.

Investors are clearly pleased to see this separation even though it was pretty much expected. One of the benefits of the separation would be to allow its streaming operations to boost content while not being weighed down by the slower-growth legacy cable business, which is seeing a decline in viewers. The cable channels still throw off decent good cash flow, but are struggling with high debt and declining subscribers as more consumers cut the cord.