EverHint - Stock Market News — January 29, 2026 — Morning Update (last 12 hours)

Executive Summary

Wall Street slid to over one-week lows Thursday as Big Tech's soaring AI capital expenditures triggered investor flight from technology stocks, with Microsoft plummeting 4.7% on disappointing Azure cloud growth and SAP suffering its worst single-day decline since 2020 after cautious 2026 cloud guidance—sparking fears that massive AI infrastructure spending failing to translate into proportional revenue acceleration. Software sector experienced broad-based selloff with Microsoft's Azure barely meeting 20% growth expectations despite record $22 billion quarterly capex, while SAP's conservative forecasts ignited concerns about AI disrupting traditional enterprise software business models faster than vendors monetizing new capabilities. Meta bucked the trend with shares surging 10% in European premarket trading after announcing 73% capital expenditure increase to $130+ billion annually for "superintelligence push," demonstrating market rewarding bold AI commitments over cautious incrementalism. Commodities delivered dramatic moves with copper hitting all-time high above $14,000 per ton on supply constraints and AI data center demand, while gold and Bitcoin sold off sharply from recent peaks as traders locked in gains. Corporate America's restructuring wave accelerated with Mastercard cutting 4% of workforce, Dow eliminating 4,500 roles targeting $2 billion profit boost, and continued layoffs across sectors signaling efficiency prioritization over growth. Asian markets reflected mixed sentiment with Samsung warning of acute chip shortage persisting through 2026 but mobile headwinds acknowledged, Indonesia stocks tanking toward largest two-day decline on record as MSCI downgrade fears trigger capital flight, and China property stocks skyrocketing on reports Beijing easing "three red lines" debt rules. European session saw Deutsche Bank posting biggest annual profit in nearly two decades day after police money laundering raid, ABB jumping 9% on strong Q4 and upbeat outlook, while H&M flagged slow winter sales despite profit beat highlighting retail uncertainty.

Sentiment Breakdown

Net Sentiment: +5% Slightly Bullish (AI optimism countered by execution concerns)

Top Market-Moving Headlines (Last 12 Hours)

🔴 Wall Street Slides on AI Spending Fears

• Wall Street's main indexes slid to over one-week lows as Big Tech's soaring AI budgets trigger investor flight. Microsoft and SAP disappointments sparking fears massive infrastructure spending not translating to revenue growth.

🔴 Microsoft Azure Disappointment

• Microsoft shares plummet 4.7% after-hours as Azure cloud revenue growth barely meets expectations despite record $22B quarterly capex. Intelligent Cloud segment 20% growth disappoints investors expecting AI monetization acceleration.

🔴 SAP Worst Day Since 2020

• SAP's 2026 cloud revenue forecast fails to meet market expectations, triggering biggest daily stock loss since 2020. Software sector selloff intensifies on fears AI disrupting traditional business models faster than monetization.

🟢 Meta Capex Surge Applauded

• Meta boosts 2026 capital expenditures 73% to $130B+ on superintelligence push; shares surge 10% in European premarket. Market rewards bold AI infrastructure commitment over cautious incrementalism.

🟢 Copper Hits Record High

• Copper mining stocks soar as metal price hits all-time high above $14,000 per ton. Supply constraints and AI data center demand driving unprecedented rally in industrial metals.

🔴 Software Sector Crushed

• U.S. software stocks slide after SAP cautious cloud outlook and ServiceNow post-earnings drop fuel AI disruption fears. Investors questioning whether AI cannibalizing legacy software revenues faster than creating new streams.

🔴 Oracle Down 50% From Peak

• Oracle shares plunge 50% from all-time high as AI enthusiasm wanes. Cloud infrastructure giant erasing approximately $150+ billion in market value from peak levels reached last year.

🔴 Gold Miners Tumble

• Gold and silver mining stocks fall sharply as precious metal prices retreat from recent record highs. Traders locking in gains after parabolic rally as dollar stabilizes.

🔴 Bitcoin Miners Slide

• Bitcoin mining stocks tumble as world's largest cryptocurrency hits low of $84,233, down 5.5%. Crypto sector selloff extends as risk-off sentiment spreads.

🔴 First Solar Drops 13%

• First Solar shares plunge 13% on risk of Tesla building large-scale solar farms. Elon Musk's comments on earnings call about renewable energy push threatening pure-play solar competitors.

🟢 OpenAI $60B Mega-Funding

• Nvidia, Microsoft, Amazon in talks to invest up to $60 billion collectively in OpenAI. Potential mega-round would represent largest private funding in tech history, valuing AI leader at unprecedented levels.

🔴 Mastercard Cuts 4% of Workforce

• Mastercard completes business review impacting 4% of full-time employees globally. Payment giant joining Corporate America's efficiency wave despite sustained consumer spending volumes.

🔴 Dow Eliminates 4,500 Jobs

• Chemicals maker Dow cuts 4,500 roles in sweeping restructuring targeting $2 billion core profit boost. Industrial sector layoffs signal margin prioritization over top-line growth.

🟢 Deutsche Bank Record Profit

• Deutsche Bank posts biggest annual profit in nearly two decades day after police money laundering raid. Investment banking strength offsetting legal scrutiny concerns.

🔴 Indonesia Market Catastrophe

• Indonesian stocks tank toward largest two-day fall on record as MSCI downgrade risk triggers capital flight. Southeast Asia's largest economy facing catastrophic market dislocation.

Thematic Analysis

Big Tech AI Spending Backlash: Microsoft and SAP Trigger Selloff (4 headlines)

Analysis: Wall Street's Thursday selloff represents watershed moment where investors shifted from rewarding AI infrastructure spending to demanding proof of monetization, with Microsoft's 4.7% plunge and SAP's worst day since 2020 signaling tolerance for "build it and they will come" narratives exhausted. Microsoft's disappointment particularly damaging given company's first-mover advantages through OpenAI partnership, GitHub Copilot integration, and Office 365 AI features—yet Intelligent Cloud segment delivering only 20% growth despite record $22 billion quarterly capital expenditures suggests enterprise customers evaluating AI capabilities but delaying production deployments pending ROI clarity. The Azure miss especially concerning because Microsoft positioned as primary beneficiary of AI infrastructure wave, with competitors Amazon AWS and Google Cloud potentially facing similar scrutiny when reporting (AWS earnings Feb 6). SAP's conservative 2026 cloud forecasts ignited deeper concerns about AI disrupting traditional enterprise software faster than vendors can monetize new capabilities, with fears that generative AI tools enabling customers to build custom solutions rather than purchasing packaged software subscriptions. The broader software sector selloff (ServiceNow dropping post-earnings despite beating estimates) demonstrates investor reassessment of entire category—if AI drives efficiency gains allowing enterprises to reduce software spending, cloud growth rates may structurally decline even as AI adoption accelerates. Meta's contrasting 10% surge in European premarket trading after announcing 73% capex increase to $130+ billion highlights bifurcated market: investors rewarding companies making existential all-in bets (Meta's "superintelligence push") while punishing those attempting incremental AI monetization within existing business models. The divergence suggests market believes AI creating winner-take-most dynamics where bold infrastructure commitments secure competitive moats while cautious players lose relevance. Oracle's 50% decline from peak (erasing $150+ billion market value) provides cautionary tale—company's AI cloud ambitions failed to materialize at scale anticipated, triggering valuation reset. Critical question emerging: are current AI capital expenditure levels sustainable if revenue growth remains modest, or must Big Tech slash spending triggering negative feedback loop for semiconductor/infrastructure suppliers?

Commodities Divergence: Copper Record High, Gold/Bitcoin Retreat (3 headlines)

Analysis: Commodities markets Thursday delivered stark divergence with copper hitting all-time high above $14,000 per ton while gold miners tumbled and Bitcoin slid 5.5% to $84,233, reflecting bifurcation between industrial metals benefiting from AI infrastructure build-out versus monetary metals/crypto suffering profit-taking after parabolic rallies. Copper's record surge driven by structural supply-demand imbalance as AI data centers (Meta $130B capex, Microsoft $88B+ annual, Tesla $20B plans) requiring massive electrical infrastructure consuming copper for power distribution, cooling systems, and networking cables—demand growing faster than mining capacity expansion with major deposits requiring 5-10 years to develop. China's property sector stimulus (easing "three red lines" debt rules) adds demand layer as construction activity potentially recovering from multi-year lows. European copper-related stocks surging demonstrates equity market recognizing beneficiaries, with miners like Glencore (despite reporting 11% copper output decline in 2025) positioned for margin expansion as prices outpace cost inflation. Tungsten also hitting record highs on Chinese export curbs tightening supply of critical metal used in semiconductor manufacturing and defense applications. Gold's pullback from recent record highs represents profit-taking rather than fundamental reversal—precious metal rallied on "bye America" dollar weakness and geopolitical uncertainty (Trump policy volatility, trade tensions), but near-term momentum exhausted as traders lock gains. Silver mining stocks declining in sympathy despite industrial demand from solar panels and electronics. Bitcoin's 5.5% slide to $84,233 extends crypto sector weakness as risk-off sentiment spreads from equities, with mining stocks (Marathon Digital, Riot Platforms, CleanSpark) amplifying losses. The crypto decline notable given Trump administration's pro-crypto stance and White House meetings on legislation—suggests technical factors (overleveraged positions unwinding) outweighing fundamental tailwinds. Commodities divergence reinforces thesis that physical economy (copper for electrification, tungsten for chips) outperforming financial assets (gold, Bitcoin) as AI infrastructure requires tangible materials regardless of market sentiment.

Software Sector Crisis: AI Disruption Faster Than Monetization (3 headlines)

Analysis: Enterprise software sector experiencing existential crisis as SAP's cautious 2026 cloud guidance combined with Microsoft Azure disappointment and ServiceNow post-earnings weakness suggests AI disrupting legacy business models faster than vendors monetizing new AI capabilities—potentially forcing wholesale repricing of cloud valuations. SAP's biggest daily decline since 2020 particularly alarming given company's dominance in enterprise resource planning (ERP) systems for manufacturing, logistics, and finance departments; conservative cloud revenue forecasts implying either: (1) enterprise customers delaying software purchases pending economic clarity, (2) AI tools enabling companies to reduce reliance on packaged software through custom in-house solutions, or (3) competitive dynamics intensifying as new AI-native startups undercutting incumbents. The fear spreading through software sector that generative AI—rather than creating incremental revenue streams—might cannibalize existing subscriptions by dramatically improving developer productivity (fewer seats needed) and enabling business users to build workflows without IT departments (reducing enterprise software demand). ServiceNow's post-earnings drop despite beating estimates demonstrates investor skepticism about sustainability of growth rates even for AI-powered workflow automation leader. OpenText stock falling 5.8% after CEO transition announcement adds to sector weakness. The software selloff stands in stark contrast to semiconductor/infrastructure beneficiaries (Nvidia, copper miners) suggesting market believes AI's primary value accrual occurs at infrastructure layer rather than application layer. Microsoft's simultaneous Azure disappointment and record capex spending encapsulates dilemma: company burning cash building AI infrastructure but struggling to convert that investment into proportional cloud revenue growth. If software giants like Microsoft, SAP, and ServiceNow facing monetization challenges, smaller pure-play SaaS companies potentially facing existential threats. Sector may require 2-3 quarters demonstrating AI-driven revenue acceleration to regain investor confidence; otherwise, expect continued multiple compression as growth assumptions reset lower.

Mass Layoffs Wave Intensifies: Mastercard, Dow, Amazon Echo (3 headlines)

Analysis: Corporate America's 2026 layoff wave accelerated Thursday with Mastercard cutting 4% of global workforce and Dow eliminating 4,500 positions (targeting $2B profit boost) following Tuesday's Amazon 16,000-person and UPS 30,000-person announcements—demonstrating that efficiency prioritization extending beyond technology sector into industrials, financials, and services as AI-enabled automation makes headcount reduction structurally irreversible. Mastercard's 4% workforce reduction particularly significant given company's sustained transaction volume growth and strong Q4 profit beat; CFO framing cuts as "business review" outcome signals that even profitable growth companies replacing human labor with automated systems (AI fraud detection, algorithmic underwriting, chatbot customer service) faster than business expansion requires hiring. Payment giant's decision validates thesis that AI's first-order effect automating white-collar tasks (data analysis, reporting, routine processing) before generating new job categories. Dow Chemical's 4,500-job cut targeting $2 billion profit improvement represents 5-6% workforce reduction for industrial giant facing margin pressure from Chinese competition and cyclical demand weakness; management explicitly connecting restructuring to "core profit boost" rather than revenue decline suggesting proactive optimization versus reactive crisis management. The chemicals sector layoffs signal industrial economy adopting technology sector's efficiency playbook—using automation and process optimization to reduce labor intensity even during stable demand periods. Factbox headline noting "Corporate America continues job cuts in 2026 in efficiency push" (less than 30 days into year) underscores pervasive nature of trend across sectors: technology (Amazon, Microsoft potentially), logistics (UPS), financials (Mastercard), industrials (Dow, Caterpillar discussing AI efficiency), and manufacturing (auto sector headwinds). Labor market implications significant—if large profitable companies shedding workers despite revenue growth, structural employment headwinds emerging that Federal Reserve rate cuts cannot offset. Consumer spending sustainability questioned if layoff wave extends beyond targeted efficiency plays into broader economic weakness.

Indonesia Market Collapse: Emerging Market Contagion Risk (2 headlines)

Analysis: Indonesia's stock market plunge extending toward "largest two-day fall on record" following initial -7.77% Tuesday crash represents catastrophic emerging market dislocation that exposes fragility of passive index-driven capital flows and raises contagion fears for other developing economies with governance opacity. Thursday's additional -1.97% decline brings multi-day losses exceeding 9%+ (some reports suggesting cumulative declines approaching 14%+ from recent peaks) as MSCI downgrade risk triggers mechanical selling from passive ETFs required to match benchmark weightings—creating negative feedback loop where index provider concerns about regulatory and market structure issues force capital outflows exacerbating very instability MSCI citing. Indonesia—Southeast Asia's largest economy (280M population, $1.3T GDP, G20 member)—experiencing frontier market-style volatility typically reserved for much smaller economies, raising questions about whether other MSCI Emerging Market constituents (Vietnam, Pakistan, Egypt, South Africa) vulnerable if governance standards applied more stringently globally. The capital flight mechanics brutal: international investors holding Indonesian equities through EM index funds face redemption pressure forcing sales regardless of individual stock fundamentals, while active managers piling on as technical levels break (support failures, margin calls) creating capitulation. Local currency (rupiah) likely under pressure as foreign investors repatriate proceeds, potentially forcing Bank Indonesia to defend currency through intervention or rate hikes despite weak economic growth. Critically, Indonesia's crisis occurring simultaneously with China property sector turmoil (even as stocks rally on easing hopes) and broader EM underperformance versus developed markets—suggesting risk premium for emerging market exposure repricing higher across asset classes. Geopolitical dimension adds complexity: Indonesia navigating great power competition between U.S. and China, with governance concerns potentially reflecting Western pressure on Southeast Asian nation maintaining strategic autonomy. Near-term expect EM ETF outflows accelerating as Indonesia's weight reduction forces broader rebalancing, with regional contagion risk to Thailand, Malaysia, Philippines if investors reassess entire ASEAN exposure.

China Policy Signals: Property Rally on Debt Rule Easing (2 headlines)

Analysis: Chinese property stocks' explosive rally Thursday on reports Beijing easing "three red lines" debt leverage rules represents potential major policy pivot from Xi Jinping's multi-year real estate deleveraging toward growth stabilization as economic data weakens—though investor skepticism warranted given previous false dawns. Reuters reporting suggesting authorities allowing "flexible implementation" of framework that triggered sector collapse (Evergrande, Country Garden bankruptcies owing $300B+ combined) signals pragmatic acknowledgment that continued strict enforcement threatens financial stability with property representing 25-30% of Chinese GDP. Stock market reaction (developers surging) reflects hope regulatory relief allows refinancing maturing debt, project completion resuming, and stabilization of pre-sale housing crisis where millions paid for unfinished apartments. However, fundamental overcapacity unchanged—estimated 60M+ vacant residential units nationwide with demographic headwinds (aging population, declining births, urbanization slowing) suggesting structural demand plateau regardless of policy accommodation. The easing reports arriving simultaneously with Bain consultancy forecasting China luxury market rebounding in 2026 and separate analysis noting "luxury goes local in China" with second-tier cities becoming primary growth drivers—painting picture of consumption patterns shifting geographically and demographically even if property policies relax. ByteDance and Alibaba preparing to launch new AI models for Lunar New Year demonstrates tech sector maintaining innovation momentum despite regulatory scrutiny. Alibaba's logistics arm Cainiao acquiring stake in robovan developer Zelostech on automation investments continuing. Critical question whether property easing tactical (preventing disorderly collapse) or strategic (reigniting speculation-driven growth model)—most likely former, with Beijing seeking stabilization at lower equilibrium rather than return to pre-2020 bubble dynamics. Investors should view property stock rally as relief bounce requiring policy confirmation before assuming sustained recovery; previous easing signals proved temporary as authorities balanced growth support against financial stability concerns.

Market Implications

Wall Street's slide to one-week lows on AI spending concerns marks inflection point where "build it and they will come" narrative exhausted—investors now demanding proof that hundreds of billions in Big Tech capital expenditures translating to proportional revenue growth. Microsoft's 4.7% plunge despite earnings beat and SAP's worst day since 2020 signal that cloud growth merely meeting (versus beating) expectations insufficient to justify current valuations at 25-30x+ forward earnings. If Thursday selloff sustained through Friday trading, expect contagion to broader technology sector with software (Salesforce, Adobe, ServiceNow) and cloud infrastructure (Amazon AWS when reporting Feb 6, Google Cloud) facing heightened scrutiny. The correction potentially healthy if forcing more realistic AI monetization timelines, but risk exists that sentiment shift triggers broader tech unwind given sector concentration (Magnificent 7 accounting for disproportionate S&P 500 gains).

Meta's 10% surge in European premarket after announcing $130 billion annual capex increase represents clearest signal that market rewarding existential AI commitment over incremental approaches—Zuckerberg's "superintelligence push" framing demonstrating conviction required to maintain investor support. If Meta sustains rally through U.S. trading, expect pressure on Microsoft, Google, Amazon to match or increase AI spending guidance or risk competitive positioning concerns. The capital intensity arms race creates structural multi-year tailwind for semiconductor ecosystem (Nvidia GPUs, Samsung/SK Hynix memory, ASML lithography, TSMC manufacturing) as spending measured in hundreds of billions cannot easily reverse without admitting strategic failure. However, sustainability questions mount if OpenAI requiring $60 billion funding rounds while reportedly unprofitable—suggesting path to cash generation unclear unless AI applications drive revenue multiples beyond current enterprise software economics.

Copper hitting all-time high above $14,000 per ton validates thesis that AI infrastructure build-out creating structural demand for industrial metals regardless of equity market sentiment. Mining stocks (Freeport-McMoRan, Southern Copper, Glencore) positioned for multi-year tailwind as new supply requires 5-10 years to develop while demand accelerating. China property easing adds potential demand layer if construction activity recovers, though overcapacity concerns warrant caution. Tungsten's record highs on Chinese export curbs highlights critical mineral supply chain vulnerabilities—U.S. defense and semiconductor sectors dependent on materials where China controls 80%+ global production. Expect continued commodity divergence with industrial metals (copper, tungsten, aluminum for data centers) outperforming monetary metals (gold profit-taking) as physical economy requirements trump financial asset speculation.

Software sector crisis potentially forcing wholesale repricing if AI disruption (enabling custom solutions, reducing seat counts, improving developer productivity) cannibalizing legacy revenues faster than new AI capabilities generating incremental sales. SAP's conservative guidance and Microsoft Azure disappointment suggest enterprise adoption slower than infrastructure build-out implies—companies evaluating AI but delaying production deployments pending ROI proof. If software giants struggling to monetize despite first-mover advantages, smaller pure-play SaaS companies face existential threats. Sector requires 2-3 quarters demonstrating AI-driven revenue acceleration or expect continued multiple compression. Oracle's 50% decline from peak provides cautionary example of valuation resets when AI cloud ambitions fail to materialize.

Indonesia's market collapse toward largest two-day decline creates emerging market contagion risk as MSCI governance concerns trigger passive outflows. Vietnam, Egypt, Pakistan, other EM markets with regulatory opacity potentially facing similar scrutiny. Near-term expect EM ETF redemptions accelerating with regional spillover to ASEAN economies. China property rally on debt rule easing represents tactical relief rather than all-clear signal—fundamental overcapacity unchanged, but if Beijing genuinely pivoting from deleveraging to growth stabilization, commodities (copper, iron ore) could see demand support.

Vlad's Key Takeaways (EverHint)

• Wall Street slides to week-low: Big Tech's soaring AI budgets trigger investor flight; Microsoft -4.7%, SAP worst day since 2020
• Microsoft Azure disappoints: Cloud growth barely meets 20% expectations despite record $22B quarterly capex; AI monetization questioned
• SAP cloud warning crushes software: Conservative 2026 guidance sparks fears AI disrupting legacy models faster than monetization
• Meta surges 10% premarket: $130B annual capex (73% increase) on superintelligence push; market rewards bold AI commitment
• OpenAI $60B mega-round: Nvidia, Microsoft, Amazon in funding talks for largest private tech investment in history
• Copper hits record $14,000: Mining stocks soar on supply constraints and AI data center demand; tungsten also at highs
• Gold miners tumble: Precious metals retreat from record highs as traders lock gains; Bitcoin -5.5% to $84,233
• Oracle down 50% from peak: Cloud giant erases $150B+ market value as AI enthusiasm wanes
• First Solar drops 13%: Tesla solar push threatens pure-play competitors
• Software sector crushed: SAP, Microsoft, ServiceNow weakness fuel AI disruption fears across enterprise software
• Mastercard cuts 4% of workforce: Payment giant joins efficiency wave despite sustained consumer spending
• Dow eliminates 4,500 jobs: Chemicals maker targets $2B profit boost in sweeping restructuring
• Deutsche Bank record profit: Biggest annual earnings in two decades day after police money laundering raid
• Indonesia market catastrophe: Stocks tank toward largest two-day decline on MSCI downgrade risk; capital flight accelerates
• China property skyrockets: Stocks rally on reports Beijing easing "three red lines" debt rules; policy pivot hopes

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