This week brings a huge earnings test for AAPL, AMZN, GOOG, META and MSFT. I’m going to sell Microsoft out of my 12-18 month Jubak Picks Portfolio on Monday, April 27, ahead of the earnings report. That position is up 319% since I initiated it on June 14., 2018. I am keeping Microsoft in my long-term 50 Stocks Portfolio. That position is up 40% since I initiated it on January 18, 2022.
The Magnificent Seven stocks–Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla–now account for about 35% to 40% of the market cap of the Standard & Poor’s 500 index.
Alphabet/Google (G00G) borrowed another $20 billion in its biggest ever U.S. dollar bond sale on Monday. And that’s just the beginning. The company is also planning debut deals in Switzerland and the UK. Including the sale of 100-year bonds.
Drum role, please: That would be the the first time a tech company has tried a 100-year offering since the Dotcom boom of the late 1990s. (Remember how that ended?) The big borrowing spree comes just days after tech companies from Meta Platforms (META) to Amazon.com (AMZN) said they were ramping up capital spending to build out infrastructure for AI. Those capital spending plans sent AI sector stocks into a steep decline on fears that AI companies would not be able to generate the cash flow needed to fund these capital spending plans. But that was sooo last week.
No slowdown on plans for AI capital spending in earnings results this past week from Big Tech. Alphabet/Google (GOOG) said it was increasing what it planned to spend on A.I. data center projects this year by $6 billion, after spending nearly $64 billion over the past nine months. Microsoft (MSFT) said it had spent $35 billion in its latest quarter, $5 billion more than it had told investors to expect just a few months ago.
Amazon (AMZN) said it would be “very aggressive” in adding more data centers and would spend $125 billion this year-— and even more next year. Meta Platforms (META) raised its spending forecast to at least $70 billion by the end of the year, which would be nearly double what it spent last year. The stock market reaction wasn’t unalloyed joy. Investors seemed generally positive on spending plans from Alphabet, Microsoft, and Amazon. And skeptical of Meta’s strategy and spending.
Today’s Quick Pick is Amazon.com (AMZN)–despite the current tariff panic. While the stock is down due to the broad market sell-off and concerns over tariffs impacting its supply chain, I believe Amazon’s size and logistical power will help it mitigate these challenges. The company can pressure suppliers, adjust pricing algorithms, and shift sourcing to keep costs lower than competitors, potentially gaining an edge as inflation rises. Though these advantages may not be evident in the upcoming April earnings report, I expect Amazon to emerge stronger in the long term, making it a compelling buy once the market shifts from indiscriminate selling to evaluating winners and losers.
Apple (AAPL) has confirmed that it’s delaying the release of a new AI Siri digital assistant. The company now expects to roll out the software sometime “in the coming year.” The effort will give Siri “more awareness of your personal context, as well as the ability to take action for you within and across your apps,” the iPhone maker said in a statement. “It’s going to take us longer than we thought to deliver on these features.” Apple’s struggles to finish the new AI capability for Siri has been a one secret for the last month or so after Bloomberg’s Mark Gurman reported on the delay. The Siri AI features were first touted in June 2024 at the company’s Worldwide Developers Conference. When Apple announced the features at WWDC, it didn’t provide an arrival date for the Siri upgrade, Gurman reported. Within the company, though, the plan was to include the new technology in iOS 18.4, which comes out in April.
Today’s Hot Money Moves NOW is China Buys More Gold. Gold seems like a good asset to own right now but it’s also trading at record highs. So while gold is safe, especially if inflation goes up, how much higher do you expect gold to go? One thing to look at it is who is emerging as a buyer. Central banks have been buying gold to hedge risks and diversify, which has contributed to the record highs. Recently, the Chinese government announced that 10 big Chinese insurance companies will now be allowed to put up to 1% of their portfolios into gold. This hasn’t been allowed in the past and will provide about $27 billion for new gold buying. This is also just another sign that countries and businesses are looking to hedge risk by buying gold and it’s one of the safer places to be in an uncertain market.
Today’s video is Is Wall Street ready to write off 2025? I’m seeing a gradual move on Wall Street from “Trump doesn’t mean what he’s saying about tariffs and mass deportations” to “Maybe he is serious.” On Monday, Trump announced 25% tariffs on steel and aluminum with a starting date of March 4, on top of other tariffs already announced. You can see the shift in commentary from big banks like Bank of America and JP Morgan. These companies are now saying that things that will negatively affect growth are happening much more quickly than things that will support the stock prices. New tariffs and economic uncertainty, which has caused the Fed to refrain from cutting interest rates, are happening now and will be hitting the market. Tax cuts and deregulation, which could goose growth, will take longer to implement and we may not feel those positive effects until 2026 or later. Wall Street is basically saying that 2025 will be a year of negative risks, but 2026 may be more of an upside if tax cuts and deregulation do, indeed, happen.
Today’s video is the Fed is between a rock and a hard place. Inflation has been stuck around 2.8% and the Fed would like to get it down to 2%. In January, the Fed paused any movement on interest rates but Wall Street remained hopeful for two cuts in 2025. The March 19 meeting will include a dot plot that will outline whether or not the central bank is thinking about any cuts for 2025. The problem is the Fed doesn’t know where the economy is going. There are too many uncertainties surrounding constantly changing Trump tariffs as well as the expected tax cut bill (which will result in higher yields and a market and economic stimulus). The budget also remains an unanswered question. These uncertainties, with the Fed also under huge political pressure from the Trump administration to make interest rate cuts, catch the Fed between a rock and a hard place and we won’t know how the Fed plans to address its dilemma until March.
In 2025 you will want your portfolio fully weighted toward AI, ENERGY, and WEIGHT-LOSS DRUG stocks.
Not just any stock in those sectors, of course. All three sectors will be full of surprises and they won’t play out the way the conventional wisdom now believes. Some stocks in these sectors will do just okay as a rising tide lifts all boats. But some stocks will be GREAT. These winners could be the foundation for another great year for your portfolio. In fact, I expect that 2025 will be a tough year for an investor to make money even if stocks do finish higher. That’s because the year will be filled with more than the usual twists and turns designed make you sell on fear just when you should be holding on or even buying more. And don’t think that the year won’t include more than one of those moments rallies designed to suck you in at the top because–well, because you fear missing out. Yes, FOMO, fear of missing out will be alive and well in 2025. To do well in 2025, you’ll have to not only pick the hot trends, but also understand when that trend is about to zig zag and which stocks you’ll want to ride through all the noise and chaos. Giving you what you need for profits in 2025vis what this Special Report: 10 stock picks for the hottest sectors of 2025 is all about.And there’s no better sector to demonstrate the challenges of 2025 than Artificial Intelligence, the first of my hottest sectors for 2025. (The next two hot trends, energy and weight-loss drugs will follow in the next few days.)
I advise investors not to think for a moment that the regulatory issues that faced Big Tech under the Biden Administration have al gone away. President Trumps key picks for the Federal Communications Commission (FCC) and the Federal Trade Commission (FTC) show there are still big bumps in the road ahead.
In December U.S. economy in December added the most jobs since March and the unemployment rate unexpectedly fell. Nonfarm payrolls increased 256,000, exceeding all but one forecast in a Bloomberg survey of economists. The unemployment rate fell to 4.1%, while average hourly earnings rose 0.3% from November, a Bureau of Labor Statistics report showed Friday. For 2024 as a whole, the economy added 2.2 million jobs—-below the 3 million increase in 2023 but above the 2 million created in 2019. The data almost certainly assured that the Federal Reserve would not cut interest rates at its January 29 meeting. As of 11 a.m. New York time, the yield on the 10-year Treasury had climbed another 5 basis points to 4.74%.
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