1. We’re almost there.

All eyes are turning to Nvidia earnings tonight, with the stock going nowhere for the last few quarters despite “beat and raise” results.

Fears are that most good news is already priced in, so tech stocks are under pressure.

But stocks tend to bounce back whenever sentiment reaches extreme fear.

2. Forget MAGA, here comes the MEGA trade.

“Donald Trump’s election victory was seen as the swan song for long-struggling European assets.

But, far from tumbling, the Euro Stoxx 50 is up 12% since the U.S. election, compared with 3.5% for the S&P 500.”

Part of the explanation is that Europe is the obvious place to diversify into bargain “value” stocks now that the “Magnificent Seven” technology giants’ sky-high valuations have started to look frothy.

What is special about this European rally, however, is that it doesn’t just appear to reflect a bounce from the bottom, but a more durable transformation. This is what Mizuho strategist Jordan Rochester has dubbed the MEGA, or “Make Europe Great Again,” trade.

And the crucial question for markets is whether Germany—the nation that has so far hampered fiscal spending domestically and across the Continent, as well as EU strategic autonomy—will be able to change course.

Source:WSJ

3. The German equity rally has passed a big hurdle.

The rush to bet on German stocks has further to run following the country’s elections, though investors might starting to get carried away about any big reforms happening soon.

The country’s DAX price index has surged over 16% since the decision in November to hold the elections, making it the best performing major benchmark in Europe.

The biggest move since sunday’s election has been in the mid-cap MDAX, which rallied 1.5% yesterday, a bet on the potential for more borrowing and spending to reboot the economy under a new government.

“The possibility of more fiscal easing, while uncertain, should continue to support German equities,” say Barclays strategists led by Emmanuel Cau. “Although DAX has performed well year-to-date, largely due to internationally geared megacaps, the more domestic Germany-exposed MDAX and our German revival basket have lagged, suggesting that investors ascribed a low probability of successful growth-oriented policies from the new government.”

4. Microsoft clarifies its AI capex.

Analysts at TD Cowen suggested that Microsoft had canceled some data center leases, causing the tech sector to spiral. The analysts cited channel checks that indicated Microsoft canceled leases with at least two private data center operators.

However, the company clarified today that it’s sticking to its plan to allocate more than $80 billion of its cash to capital expenditures.

With that said it acknowledged that it “may strategically pace or adjust our infrastructure in some areas.” The company says its well positioned to meet current and increasing customer demand, saying, “Last year alone, we added more capacity than any prior year in history. While we may strategically pace or adjust our infrastructure in some areas, we will continue to grow strongly in all regions. This allows us to invest and allocate resources to growth areas for our future.”

Much ado about nothing! Buy the dip in Vertiv?

5. Nearly every big technology firm in the US & China are now linked to humanoids or robotics.

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