Investor Dan Niles' favorite picks for the rest of earnings season
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Miami Herald
36 minutes ago
- Miami Herald
Tesla just got its biggest break yet in the robotaxi wars with a key permit
Every so often, Tesla (TSLA) makes a headline-grabbing move that seems more like a turning point hiding in plain sight. No flashy event, just a subtle permit that could potentially become the foundation for something much bigger in the robotaxi race. Don't miss the move: Subscribe to TheStreet's free daily newsletter And while the EV giant has massive long-term ambitions, this one could open up a path to a business that might rewrite the rules of an entire sector. In the robotaxi space, where a first-mover advantage can make or break the competition, this step could be massive as Tesla moves from talking about the future to building it. Tesla's robotaxi ambitions began in Texas back in late June, when it launched a paid, invitation-only pilot in Austin. The early program was operated within a tight geofenced zone, with the first users reporting long waits and limited coverage. However, since then, Tesla has expanded quickly, and as per its Phase 3 rollout, it has reportedly doubled the geofence, testing and refining its Full Self-Driving (FSD) v12 software in live service. Related: Jim Cramer delivers straight talk on tricky S&P 500 market Still, the road's been anything but smooth, led by multiple lawsuits and regulators keeping a close eye on matters. Also, reporting suggests that Tesla has shelved its in-house Dojo AI training project, opting for external computing resources. Competition is fierce, too. Google's Waymo remains the U.S. leader, operating its driverless fleet across roughly 250 square miles in Los Angeles and the San Francisco Bay Area. Also, Phoenix is still active, and with Dallas now coming online through a partnership with Avis, Waymo is set to go beyond its recent feats (completing a million rides recently). Uber is taking a much different route, working as an aggregator instead of building its own autonomous vehicle. It's already integrating Waymo rides in Austin and Atlanta, and inked a massive, multi-year deal with Lucid and Nuro to deploy over 20,000 autonomous Lucid Gravity SUVs over six years. Lucid's Gravity-based robotaxi, equipped with Nuro Driver, recently began closed-circuit autonomous testing and is eyeing launch in the first city via Uber's platform. The AV race is also heating up overseas. Baidu's Apollo Go is running a fully driverless service in 10+ Chinese cities, while secured permits for paid rides in Shanghai. Similarly, upstarts like DiDi and WeRide are preparing for major expansions into newer global markets. Though forecasts differ, analysts agree that the robotaxi industry is set for explosive expansion over the next few years. Goldman Sachs projects that the global robotaxi rideshare market could potentially grow by an estimated 90% compound annual growth rate through 2030. In China alone, Goldman expects the market to hit close to $12 billion by 2030 and $47 billion by 2035. That effectively translates to 500,000 vehicles in service by 2030 and 2.3 million by 2035. Related: Surprising AI chip stock is up 90% in 30 days (and still climbing) Grand View Research offers a similar view, estimating the global market to grow from $1.95 billion in 2024 to a whopping $43.7 billion by 2030, a CAGR of about 73.5%. Early traction suggests that demand is likely to come to fruition, especially with Waymo already delivering millions of rides, and by late 2024, it was handling roughly 100,000 rides a week across its service areas. For Tesla, the stakes are even higher. Cathie Wood's ARK Invest argues that without a viable robotaxi business, Tesla's long-term valuation will be significantly lower. Elon Musk has repeatedly cited autonomy as Tesla's defining product roadmap. If Tesla can match or exceed Waymo's operational scale while clearing regulatory and safety bottlenecks, the payoff could be transformative. Tesla just checked off a major box in its push to dominate the robotaxi space. The EV behemoth just secured a critical rideshare license in Texas, which clears the way for its Robotaxi service to operate in the state. The breakthrough puts Elon Musk's company in the same regulatory category as Uber and Lyft, but without the human driver. More News: Veteran analyst drops 6-word verdict on Apple's $100 billion investmentBank of America drops shocking price target on hot weight-loss stock post-earningsJPMorgan drops 3-word verdict on Amazon stock post-earnings Also, the timing effectively lines up with a shift in the state's law. Starting September 1, Texas will need autonomous rideshare services to meet the same regulatory standards as traditional ones. That includes mandatory cameras, insurance coverage, and adhering to traffic laws, which adds another layer of accountability to the whole operation. The license builds on Tesla's recent Robotaxi pilot in Austin. With Texas in the bag, Tesla is looking at Nevada, Arizona, California, and Florida next. These states have been a lot more open to the daunting autonomous driving technology. Tesla's regulatory woes are far from settled, but the Texas license marks a major step toward its CEO's vision for a driverless future. Related: Morgan Stanley resets AMD stock price target after earnings The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Business Insider
an hour ago
- Business Insider
The Week That Was, The Week Ahead: Macro & Markets, August 10, 2025
Everything to Know about Macro and Markets Stocks rebounded on Friday, closing the week firmly in the green – the market's third winning week out of the last four. The S&P 500 (SPX) rallied for its strongest week since late June, closing on the brink of a record after gaining 2.43%. The Dow Jones Industrial Average (DJIA) finished the week up 1.35%. Meanwhile, the Nasdaq-100 (NDX) surged by 3.73%, reaching a new record. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. The Land of the Buoyant Technology and Consumer Discretionary sectors led the charge, while healthcare lagged amid tariff and clinical-trial headwinds. Tech stocks pulled major investor inflows, especially into semiconductor and AI-related names. After the prior week's pull‑back, investors bought the dip again, demonstrating conviction in the rally's viability – grounded in solid fundamentals. Around 90% of S&P 500 companies have reported Q2 earnings, with 81% beating expectations – the best since Q3 2023. In tech, more than 90% have exceeded forecasts. These strong results have prompted analysts to lift Q3 earnings expectations, particularly for Energy, Communication Services, Technology, and Financials. Despite ongoing tariff-related and broader macro uncertainties, the U.S. corporate sector remains resilient – with expectations that this strength will persist, assuming the economy holds. Companies' managements and boards are reflecting that confidence through share repurchases. In July alone, U.S. companies announced a record $166 billion in stock buybacks – the highest for any July on record, and year-to-date repurchases now total nearly $926 billion, exceeding the previous record. Additionally, IPO activity is robust – as of August 5, 2025, there have been 202 IPOs in the U.S., up 80% over the same period last year. This resurgence is widely seen as driven by growth and profitability – quite distinct from the speculative SPAC wave in 2021. The divergence between Wall Street and Main Street sentiment is narrowing – both appear to be looking past the dire headlines on tariffs, economic, and geopolitical risks. New business creation in the U.S. has surged since November, with July business applications hitting their highest levels since late 2007. …and the Resilient President Donald Trump claimed tariffs were 'having a huge positive impact on the stock market,' adding that 'hundreds of billions of dollars are pouring into our country's coffers,' supporting the economy and equities. Whether tariffs deserve credit is debatable – but the fear factor seems much less than expected. The average effective U.S. tariff rate is at its highest level since the Great Depression – yet today's economy and corporate sector are far more advanced and adaptive. Tariffs have already nudged prices upward, and a short-term inflation bump is expected throughout this year and next. Still, the U.S. economy – dynamic and resilient – is adjusting. Companies are shifting supply chains, and because tariffs were announced ahead of time, they had ample time to prepare. Some sectors may even benefit from increased domestic investment and reshoring. On the household front, while tariffs could dent purchasing power via higher prices, the impact should be limited and temporary, not a sustained driver of inflation. Future trade agreements are expected to ease tensions and help contain inflation and growth risks. Last week's rally underscores U.S. resilience – stocks advanced even as Trump's tariff rollout accelerated. In fact, some signs of economic softness may have aided the rally, by heightening odds of a 0.25% rate cut in September. With valuations rich but still not technically overbought, a rate cut could inject fresh momentum heading into the Q3 earnings season. Nevertheless, analysts broadly agree that the path ahead may remain choppy, with trade, macro, and geopolitical developments likely to test investor resolve. Stocks That Made the News ▣ Stocks heavily exposed to higher tariffs – including Lululemon (LULU), Nike (NKE), Caterpillar (CAT) – ended the week deep in the red as tariffs took effect. Caterpillar (CAT) warned of up to $1.5 billion in tariff-related costs for the year, with $400-500 million expected in Q3 alone, and its shares slipped on profit-miss news. Caterpillar's tariff exposure made it one of the week's weakest performers in industrials. Meanwhile, several stocks – including Kroger (KR), Monster Beverage (MNST), Cummins (CMI), Fastenal (FAST), Bank of New York Mellon (BK) – closed at all-time highs. ▣ The newly proposed 100% tariffs on semiconductors didn't become a drag, as exemptions were broader than expected and included firms with U.S. production. Apple (AAPL) had its best week since 2020 amid optimism that its plan to spend about $600 billion over four years on U.S. manufacturing would help it avoid tariffs. ▣ Taiwan Semiconductor Manufacturing (TSM) reported a ~26% YoY revenue surge in July, driven by accelerating AI demand. In response, it raised its 2025 U.S.-dollar sales growth forecast to around 30%. TSMC was exempted from the proposed 100% U.S. tariff due to its extensive U.S. investments, including a $165 billion commitment for plants in Arizona. ▣ Tesla (TSLA) investors cheered the dismantling of its Dojo supercomputer team, sending the stock nearly 7% higher for the week as the company shifted focus to upcoming AI5 and AI6 chip architectures and leaned on external compute partners like Nvidia (NVDA) and AMD (AMD). ▣ Palantir Technologies (PLTR) surged almost 17% for the week, taking its year-to-date gain to 147% and hitting a new record after the earnings report appeared to meet the Street's elevated expectations for Q2. ▣ The Healthcare sector saw mixed action. Gilead Sciences (GILD) climbed over 5% following strong Q2 results and raised 2025 sales and EPS guidance, buoyed by a promising new HIV-prevention drug launch. Meanwhile, Eli Lilly (LLY) suffered its worst day in 25 years, tumbling over 18% for the week as obesity-pill trial data disappointed investors despite solid earnings and guidance. ▣ The Trade Desk (TTD) was the S&P 500's worst performer, plunging over 38% following its earnings report. Despite strong results, the stock was slammed with downgrades after CEO Jeff Green warned of tariff and inflation pressures. This marks its second 30%-plus drop on earnings this year, following a 33% plunge in February. Upcoming Earnings and Dividend Announcements The Q2 2025 earnings season is winding down, but several notable releases are still scheduled for this week. These include: AST SpaceMobile (ASTS), Oklo (OKLO), (MNDY), CoreWeave (CRWV), Cisco Systems (CSCO), Applied Materials (AMAT), Deere (DE), and Ross Stores (ROST).
Yahoo
an hour ago
- Yahoo
Mega-cap tech companies lead the markets higher
A version of this post first appeared on Mega-cap tech companies have been leading the stock market higher. AI investment has been driving economic growth. We hear about these storylines every single day in finance media. Occasionally, some charts and stats cut through the noise and offer some killer context. Here are a couple that recently caught my eye. The 'Magnificent Seventy'? 🤯 Nvidia (NVDA), Microsoft (MSFT), Apple (AAPL), Alphabet (GOOG, GOOGL), Amazon (AMZN), Meta (META) Platforms, and Tesla (TSLA) — the trillion-dollar companies collectively known as the "Magnificent Seven — account for about a third of the S&P 500's combined market capitalization. This concentration among the largest companies makes some people nervous. Because what if one or more of these companies sees demand sour and investors dump the stocks? My favorite counterargument to this concern is that these seven companies don't operate just seven businesses. "They may go by the Magnificent Seven, but the truth is they act more like the Magnificent Seventy," Bloomberg's Eric Balchunas and Breanne Dougherty wrote. "Collectively, the Seven have acquired over 800 companies and expanded into a dizzying array of industries — effectively functioning as conglomerates of advanced technology, while still growing organically." Each of the Magnificent Seven companies are made up of massive companies. (Source: Eric Balchunas) For the most part, the subsidiaries are tech-oriented or businesses leveraging a lot of tech. Still, it is nearly impossible to find a household or business that isn't regularly using multiple goods or services offered by at least a few of these names. "Viewed this way — as dozens of companies within each one — concerns about their record 33% weighting in the S&P 500 miss the point: the index may still be as diversified as ever," Balchunas and Daugherty added. For more on this discussion, read: 🤨 and 💪 AI investment is officially the dominant growth story 🤖 AI has been a hot story for about three years. And the buzz only seems to be heating up. Check out this chart from Luke Kawa at Sherwood News. It tracks analysts' estimates for AI capex by the major hyperscalers: Microsoft, Alphabet, Amazon, Meta, and Oracle. The curve suggests the investment spending is accelerating. AI capex spending by the hyperscalers has been heating up. (Source: Sherwood) And just how big is the AI capex story in the context of the economy? Renaissance Macro's Neil Dutta caught this incredible development in the most recent GDP report. "So far this year, AI capex, which we define as information processing equipment plus software, has added more to GDP growth than consumers' spending," Dutta said. AI capex is contributing more to GDP growth than personal consumption. (Source: Sherwood, Renaissance Macro) What's so impressive about this is how small AI capex is in the context of the economy. "The U.S. consumer makes up about 70% of the economy," Sherwood's Kawa noted about the stats. "Over the long term, that's been the undisputed engine of growth. But these two segments that make up 6% of GDP have been playing a bigger role in fueling the expansion so far this year, on average." In other words, a relatively small slice of the economy is growing so fast that it's become the dominant growth story for the whole economy. Review of the macro crosscurrents 🔀 There were several notable data points and macroeconomic developments since our last review: 👎 Inflation expectations heat up. From the New York Fed's July Survey of Consumer Expectations: "Median inflation expectations in July increased at the one-year-ahead horizon to 3.1% from 3.0% and at the five-year-ahead horizon to 2.9% from 2.6%. They remained steady at the three-year-ahead horizon at 3.0%." (Source: NY Fed) The introduction of new tariffs risks higher inflation. For more, read: 😬 ⛽️ Gas prices tick higher. From AAA: "Gas prices fluctuated slightly this past week with the national average for a gallon of regular going up by two cents to $3.16. Crude oil prices are hanging in the mid $60s per barrel, keeping pump prices steady. Supply remains abundant, as OPEC+ — a group of oil-producing countries — recently announced it will be boosting production again next month, following several other increases this year." (Source: AAA) For more on energy prices, read: 🛢️ 🏠 Mortgage rates tick lower. According to Freddie Mac, the average 30-year fixed-rate mortgage declined to 6.63% from 6.72% last week. From Freddie Mac: "The 30-year fixed-rate mortgage dropped to its lowest level since April. The decline in rates increases prospective homebuyers' purchasing power, and Freddie Mac research shows that buyers can save thousands by getting quotes from a few different lenders." (Source: Freddie Mac) There are 147.9 million housing units in the U.S., of which 86.1 million are owner-occupied and about 39% are mortgage-free. Of those carrying mortgage debt, almost all have fixed-rate mortgages, and most of those mortgages have rates that were locked in before rates surged from 2021 lows. All of this is to say: Most homeowners are not particularly sensitive to the small weekly movements in home prices or mortgage rates. For more on mortgages and home prices, read: 😖 🏭 Business investment activity deteriorates. Orders for nondefense capital goods excluding aircraft — a.k.a. core capex or business investment — decreased 0.8% to $75.4 billion in June. (Source: Census via FRED) Core capex orders are a leading indicator, meaning they foretell economic activity down the road. For more on deteriorating economic metrics, read: ⚖️ 💼 New unemployment claims remain low — but total ongoing claims are up. Initial claims for unemployment benefits rose to 226,000 during the week ending Aug. 2, up from 219,000 the week prior. This metric remains at levels historically associated with economic growth. (Source: DoL via FRED) Insured unemployment, which captures those who continue to claim unemployment benefits, rose to 1.974 million during the week ending July 26. This metric is near its highest level since November 2021. (Source: DoL via FRED) Steady initial claims confirm that layoff activity remains low. Rising continued claims confirm hiring activity is weakening. This dynamic warrants close attention, as it reflects a deteriorating labor market. For more context, read: 🧩 and 💼 💪 Labor productivity increases. From the BLS: "Nonfarm business sector labor productivity increased 2.4% in the second quarter of 2025 … as output increased 3.7% and hours worked increased 1.3%. (All quarterly percent changes in this release are seasonally adjusted annualized rates.) From the same quarter a year ago, nonfarm business sector labor productivity increased 1.3% in the second quarter of 2025." (Source: BLS) For more, read: ⚙️ 🤑 Wage growth is cool. According to the Atlanta Fed's wage growth tracker, the median hourly pay in July was up 4.1% from the prior year, down from the 4.2% rate in June. (Source: Atlanta Fed) For more on why policymakers are watching wage growth, read: 📈 💰 Household finances could be better, but are mostly normalizing. From the New York Fed's Q2 Household Debt & Credit report: "Transition into early delinquency held steady for nearly all debt types except for student loans. Student loans saw another uptick in the rate at which balances went from current to delinquent due to the resumption of reporting of delinquent student loans. Transitions into serious delinquency were mixed across debt types: auto loans and credit card debt were largely stable, mortgages and HELOCs edged up slightly, and student loans rose sharply." (Source: NY Fed) While the rate at which debt is entering delinquency has increased, the total amount of debt in delinquency remains low, at just 4.4% of outstanding debt. (Source: NY Fed) And while credit card debt balances often steal headlines, it's a mistake to say consumers are maxing out their credit cards. The $1.2 trillion in credit card balances as of Q2 represents just a tiny fraction of credit card limits. (Source: NY Fed) For more on household finances, read: 🛍️ 💳 Card spending data is strong, but could be driven by "buyahead" before tariffs. From JPM: "As of 31 Jul 2025, our Chase Consumer Card spending data (unadjusted) was 3.3% above the same day last year. Based on the Chase Consumer Card data through 31 Jul 2025, our estimate of the US Census July control measure of retail sales m/m is 0.61%." (Source: JPM) From BofA: "Total card spending per HH was up 3.0% y/y in the week ending Aug 2, according to BAC aggregated credit and debit card data. Online retail saw the biggest y/y spending gain while entertainment saw the biggest drop vs last week, across our categories. The significant rise this week could be buyahead before the Aug 1 tariff deadline/early month volatility." (Source: BofA) For more on sales being pulled forward ahead of tariffs, read: 🤔 🤷🏻 Services surveys could be better. From S&P Global's July Services PMI: "July's expansion was driven by surging demand in the tech sector alongside rising financial services activity, the latter linked to improving financial conditions fueled in turn by recent stock market gains. However, falling exports of services, which includes spending in the US by tourists, acted as a drag on growth alongside subdued demand from consumers more broadly." (Source: S&P Global) ISM's July Services PMI signaled the sector was just barely growing. (Source: ISM) Keep in mind that during times of perceived stress, soft survey data tends to be more exaggerated than actual hard data. For more on interpreting soft sentiment data, read: 🙊 🏢 Offices remain relatively empty. From Kastle Systems: "Peak day office occupancy was 63.5% on Tuesday last week, down 1.4 points from the previous week. Occupancy fell most days of the week in all 10 tracked cities, as workers took time away from the office across the country. The average low was 34.2% on Friday, down nine tenths of a point from the previous week." (Source: Kastle) For more on office occupancy, read: 🏢 📈 Near-term GDP growth estimates are tracking positively. The Atlanta Fed's GDPNow model sees real GDP growth rising at a 2.5% rate in Q3. (Source: Atlanta Fed) For more on GDP and the economy, read: 📉 and 🤨 Putting it all together 📋 🚨 The Trump administration's pursuit of tariffs threatens to disrupt global trade, with significant implications for the U.S. economy, corporate earnings, and the stock market. Until we get more clarity, here's where things stand: Earnings look bullish: The long-term outlook for the stock market remains favorable, bolstered by expectations for years of earnings growth. And earnings are the most important driver of stock prices. Demand is positive: Demand for goods and services remains positive, supported by healthy consumer and business balance sheets. Job creation, although cooling, also remains positive, and the Federal Reserve — having resolved the inflation crisis — shifted its focus toward supporting the labor market. But growth is cooling: While the economy remains healthy, growth has normalized from much hotter levels earlier in the cycle. The economy is less "coiled" these days as major tailwinds like excess job openings and core capex orders have faded. It has become harder to argue that growth is destiny. Actions speak louder than words: We are in an odd period, given that the hard economic data decoupled from the soft sentiment-oriented data. Consumer and business sentiment has been relatively poor, even as tangible consumer and business activity continues to grow and trend at record levels. From an investor's perspective, what matters is that the hard economic data continues to hold up. Stocks are not the economy: There's a case to be made that the U.S. stock market could outperform the U.S. economy in the near term, thanks largely to positive operating leverage. Since the pandemic, companies have aggressively adjusted their cost structures. This came with strategic layoffs and investment in new equipment, including hardware powered by AI. These moves are resulting in positive operating leverage, which means a modest amount of sales growth — in the cooling economy — is translating to robust earnings growth. Mind the ever-present risks: Of course, we should not get complacent. There will always be risks to worry about, such as U.S. political uncertainty, geopolitical turmoil, energy price volatility, and cyber attacks. There are also the dreaded unknowns. Any of these risks can flare up and spark short-term volatility in the markets. Investing is never a smooth ride: There's also the harsh reality that economic recessions and bear markets are developments that all long-term investors should expect as they build wealth in the markets. Always keep your stock market seat belts fastened. Think long-term: For now, there's no reason to believe there'll be a challenge that the economy and the markets won't be able to overcome over time. The long game remains undefeated, and it's a streak that long-term investors can expect to continue. A version of this post first appeared on Sign in to access your portfolio
