What a day as QQQs +4%, led by SOX +7% and ARKK +6%. Stocks finished near high of days. Yields rose 6-10bps across the curve while fed expects shifted in a hawkish direction now pricing in 55bps worth of cuts. Dollar jumped 150bps. Gold dn 3% while BTC was flat.
Equity gains were led by the big news teat China tariffs would fall to 30% form 145% for 90 days and hinted strongly they could fall further to only 10% and gave clues that other countries could get more delays post-90 days as long as negotiations continue. Investors have reduced net over the past couple months and the race is on the gross back up now that trade news significantly moving in better direction. Price action is supportive of a continued move up.
In Tech, price action was about inline with what you’d expect on a day like today given the better China news flow. Safe havens underperformed: NFLX -2.5% (Yipit was out saying UCAN net adds trending significantly below street); SPOT 4%; CART/CHWY/EBAY/TTWO all slightly in the red. In software, winners like MSFT +2.4%, PLTR +1%, and SAP -16bps underperformed laggards and more beta heavy stocks. RBLX +2.4% a nice standout tariff safe haven on the cusp of 52wk highs.
The big outperformers came from names which previously had a lot of tariff hair on them. Ad names in particular saw lots of strength: PINS +12%; META +8%; SNAP +12%; ROKU +13%…TTD +12% strong follow through here post-earnings last week - shorts are scrambling to cover here. You can believe in the structural competitive bear case here, but you know the game in Tech investing: the onus is very much on the bears when revenue is accelerating and numbers are too low (especially with a compounder darling with plenty of long only support like TTD)…
A few standout underperformers in ads: APP -6% a laggard no longer the risk-on play it once was given the skepticism/PTSD that has grown on the stock over the past couple months given every other week short report that hits. The other standout laggard, which once was a risk-on darling: RDDT +2.5%. Our friend Andrew over at Hedgeye had a call mid-day giving his view why he thinks RDDT has 40% dnside over the next 12 months as he believes increasing volatile ad and user behavior in 2H 2025 will drive faster than anticipated rev decel. We agree although a better macro environment obviously helps them, but we view RDDT facing two significant structural/secular headwinds (an inception short): Google moving down RDDT search results in favor of AI overviews and search habits moving away from GOOGL. Wait now there’s another layer: Google Search Discussions Beta May One Day Replace Reddit Results…SER:
Google has a new beta feature to encourage searchers to add comments and have discussions around a specific topic. It is called "Discussions" and has a beta label on it. You can add your own thoughts/comments to the topic and those comments can appear across a number of Google properties and services.
It makes you wonder if Google is potentially looking for ways to replace all those Reddit discussions with their own?
Uh Oh…
Finally, GOOGL +4% also a bit of an underperformer vs. other ad names. This is all really good price action if you are a L/S fundamental investor: the stocks that should underperform are underperforming.
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Other e-comm names with exposure to China/tariffs got a bid: W +20% as they benefit significantly from easing Chinese tariffs (30-35% of sourcing comes from China)and the stock w/ biggest beta to better China news. Stock also has some good idio tailwinds: 3p data has been stronger than expected and At Home is potentially filing for bankruptcy. SimilarWeb data indicates 20% of At Home website visitors subsequently visited Wayfair.com within the same day — we are always big fans of going long a stock when a key competitor is potentially entering bankruptcy. Name a lot cleaner now with lower China tariffs.
SHOP +14% a big outperformer as expected given lots of China mfg exposure and the Nasdaq 100 News. LOGI +7%/AAPL +6% from less China tariffs.
Another surprising standout: UBER +6.4% new ATHs - chart looks really nice after a 1.5 year consolidation…we’ve been talking about the change of perception here that started in earnest about a month ago - UBER now viewed as a likely winner from AV proliferation…Price action here has been really strong over the last month.
In AI semis, Neoclouds led the way higher. NBIS 18% as ClickHouse $6B funding round valued NBIS’ 28% stake at $1.68B, up from $560M - bulls think you are basically getting neocloud biz for free at this valuation. CRWV +14% ahead of earnings later this week.
ALAB +13% on Morgan Stanley’s upgrade.
NVDA +5.5% on rumors they are raising GPU prices as Trump admin considered large Chip sale to Emirati AI Firm G42. Here’s NYT:
The Trump administration is considering a deal that could send hundreds of thousands of U.S.-designed artificial intelligence chips to G42, an Emirati A.I. firm that the U.S. government has scrutinized in the past for its ties to China, three people familiar with the discussions said.
The negotiations, which are ongoing, highlight a major shift in U.S. tech policy ahead of President Trump’s visit to the Persian Gulf states this week. The talks have also created tension inside the Trump administration between tech- and business-minded leaders who want to close a deal before Mr. Trump’s trip and national security officials who worry that the technology could be misused by the Emiratis.
In the talks with G42 and officials from the United Arab Emirates, David Sacks, the White House A.I. czar, has been working on an agreement that would give the Emirati firm access to chips with limited oversight. Some of the chips would go to a partnership that G42 has with the U.S. firm OpenAI, while others would be sent directly to G42, one of the people said…
Strength all around in the rest of semis…
In software, TEAM +8% on a positive MS mention. NET +7.5% some strong follow through on last week’s great print — we think this is cleanest and best way to play proliferation of AI apps in software without any of the structural SaaS seat risk. SNOW +3.5% on some mixed Keybanc checks. ORCL +4.5% as M-sci said OCI capacity accelerated in March/April
Solar investors liked the energy credit changes in the tax bill - FSLR +11%; RUN +17%….
AFRM +15%/UPST +13% nice bounce backs after last week’s earnings
