Latest news with #Kolanovic
Yahoo
3 days ago
- Business
- Yahoo
The Trump-Musk feud could be one of the catalysts for a coming 10% stock correction, former JPMorgan strategist says
Marko Kolanovic predicts a stock market pullback could be in the cards. Kolanovic thinks Tesla's decline on the Trump-Musk feud could be among the catalysts that spark a decline. Other problems he sees for the market include high valuations and economic uncertainty. Former JPMorgan chief market strategist Marko Kolanovic sees a stock market pullback in the cards, and the Trump-Musk feud could be one of the triggers that sets off a decline. Speaking on CNBC on Thursday, Kolanovic predicted a coming correction of 5%-10% that could be set off by a drop in Tesla's stock price. "It's a little bit of a sideshow. It's important for certain companies, and it can spill over," Kolanovic said of the president's fallout with Musk. "Tesla is one of the biggest holdings of retail investors. There's a little ecosystem of stocks around it. I think it could be a little bit of a catalyst." In a post on X on Thursday, Kolanovic pointed to popular retail stocks such as Tesla, Palantir, and Super Micro as potential triggers of a momentum crash. Tesla stock plunged 14% on Thursday as Trump responded to Musk's criticisms of the big GOP tax and budget bill. However, Kolanovic also noted that the Trump-Musk fight would be one possible catalyst for a market pullback among many. Uncertainty in the economy and the trade war are also looming problems. "We're close to all-time highs, but we still have all the problems," Kolanovic said. "We have a trade war, we have signs of an economic slowdown." Valuations are stretched, he said, with the Nasdaq close to record highs even as rates remain elevated, and Kolanovic sees warning signs in the bond market. The risk-reward tradeoff for stocks versus bonds looks unattractive, as the 10-year Treasury yield hovers around 4.4%. That means equity investors aren't getting a great return in excess of the risk-free rate. There's also the lingering concern about Fed independence, with Trump repeatedly pressuring Powell to cut interest rates. Macro risks are mounting as well. Kolanovic pointed to the weak ADP jobs report earlier this week, which reported 37,000 new jobs compared to economists' expectations of 110,000. While the May jobs report showed higher-than-expected job growth, April and March numbers saw significant downward revisions. A correction could present a potential buying opportunity, but that's only if recession risks dissipate, Kolanovic said. Read the original article on Business Insider
Business Insider
3 days ago
- Business
- Business Insider
The Trump-Musk feud could be one of the catalysts for a coming 10% stock correction, former JPMorgan strategist says
Former JPMorgan chief market strategist Marko Kolanovic sees a stock market pullback in the cards, and the Trump-Musk feud could be one of the triggers that sets off a decline. Speaking on CNBC on Thursday, Kolanovic predicted a coming correction of 5%-10% that could be set off by a drop in Tesla's stock price. "It's a little bit of a sideshow. It's important for certain companies, and it can spill over," Kolanovic said of the president's fallout with Musk. "Tesla is one of the biggest holdings of retail investors. There's a little ecosystem of stocks around it. I think it could be a little bit of a catalyst." In a post on X on Thursday, Kolanovic pointed to popular retail stocks such as Tesla, Palantir, and Super Micro as potential triggers of a momentum crash. Tesla stock plunged 14% on Thursday as Trump responded to Musk's criticisms of the big GOP tax and budget bill. Back in February (2/19) drop of $PLTR on dod spending cut started market wide momentum crash. Today, we have several crowded retail names $TSLA $PLTR $SMCI that could start a similar development ... — Marko Kolanovic (@markoinny) June 5, 2025 However, Kolanovic also noted that the Trump-Musk fight would be one possible catalyst for a market pullback among many. Uncertainty in the economy and the trade war are also looming problems. "We're close to all-time highs, but we still have all the problems," Kolanovic said. "We have a trade war, we have signs of an economic slowdown." Valuations are stretched, he said, with the Nasdaq close to record highs even as rates remain elevated, and Kolanovic sees warning signs in the bond market. The risk-reward tradeoff for stocks versus bonds looks unattractive, as the 10-year Treasury yield hovers around 4.4%. That means equity investors aren't getting a great return in excess of the risk-free rate. There's also the lingering concern about Fed independence, with Trump repeatedly pressuring Powell to cut interest rates. Macro risks are mounting as well. Kolanovic pointed to the weak ADP jobs report earlier this week, which reported 37,000 new jobs compared to economists' expectations of 110,000. While the May jobs report showed higher-than-expected job growth, April and March numbers saw significant downward revisions. A correction could present a potential buying opportunity, but that's only if recession risks dissipate, Kolanovic said.
CNBC
06-05-2025
- Business
- CNBC
Don't count former JPMorgan strategist Kolanovic as part of the Palantir 'growth cult'
Former JPMorgan strategist Marko Kolanovic is questioning Palantir 's booming valuation. "So if i read this correctly $PLTR now grows slower than an average tech stock, but has a multiple that is ~25 *times* higher than an average tech stock," Kolanovic wrote in a Monday post on X . "I must not be part of that growth cult i guess." Known for his bearish calls, Kolanovic departed JPMorgan last summer after nearly two decades at the firm. His comments follow Palantir CEO Alex Karp's enthusiastic letter to shareholders on Monday , which went as far as to assert that the company's financial performance is exceeding "many of our greatest expectations." The company's first-quarter earnings matched Wall Street's consensus estimates, while revenue came in better than expected. Palantir raised its revenue forecast for the full-year to a range of $3.89 billion to $3.9 billion, and said it expects commercial revenue above $1.18 billion this year. Palantir said it is benefiting from widespread adoption of its artificial intelligence software, still shares were about 13% lower on Tuesday. The stock has so far been an outlier in an otherwise rough period for technology stocks, notching a gain of more than 40% year to date, compared with the Nasdaq Composite's 8% slump in 2025. Several analysts are calling for sharp declines in Palantir stock , saying its valuation has run too far and its international growth is lagging.
Yahoo
30-04-2025
- Business
- Yahoo
Nvidia, Oracle, and Broadcom at Risk as AI Capex Cycle Faces Headwinds
April 30 - Nvidia (NASDAQ:NVDA), Oracle (NYSE:ORCL), and Broadcom (NASDAQ:AVGO) are facing significant risks if the artificial intelligence (AI) capital expenditure (capex) cycle slows, according to Marko Kolanovic, former J.P. Morgan chief strategist. Warning! GuruFocus has detected 3 Warning Signs with NVDA. Kolanovic highlighted that AI spending, which has been a primary economic driver over the past two years, may no longer sustain its rapid growth. While demand remains high, efficiency pressures are intensifying. He emphasized concerns that large language models are becoming commoditized, which could affect the valuations of many companies that previously thrived in the AI sector. Kolanovic pointed out that major cloud providers, or hyperscalers, are now more cautious about excessive capex, especially after already committing to massive investments. He noted that while AI capex is unlikely to collapse, it is difficult to maintain the growth rate seen in recent years, especially for companies like Nvidia that rely on continuous investment. For Nvidia, he identified five potential challenges, including competition for its Mellanox business, declining CUDA adoption, and issues with its product roadmap. Similarly, Oracle's capex spending, while substantial, is growing faster than its cash flow, making it vulnerable if ROI falters. Broadcom, despite benefiting from the AI boom, faces risks due to its high valuation and exposure to competitive pressures, particularly in the Chinese market. Kolanovic warned that a slowdown in AI spending could lead to significant declines in its stock multiple. This article first appeared on GuruFocus. Sign in to access your portfolio
Yahoo
30-04-2025
- Business
- Yahoo
Kolanovic Flags Nvidia as AI Capex Risks Rise
Nvidia (NASDAQ:NVDA), Oracle (NYSE:ORCL) and Broadcom (NASDAQ:AVGO) could be in the crosshairs if the AI capex spree cools, warns Marko Kolanovic, former J.P. Morgan strategist now with Prospero, saying the frenetic buildout that fueled markets over the past two years can't sustain its breakneck pace. Warning! GuruFocus has detected 3 Warning Signs with NVDA. Kolanovic flags five emerging cracks at Nvidiacustomers designing bespoke chips, rising Mellanox competition, software layers diluting CUDA lock-in, efficiency gains bending the compute curve and potential product-roadmap hiccupsthat could rattle investor confidence. In Q1, hyperscalers inked more than 2 GW of power deals on top of Microsoft's 1.2 GW Abilene, Texas, pact and an $11.9 billion CoreWeave (NASDAQ:CRWV) agreement in Denton, Texas. Oracle, by contrast, is matching Microsoft's AI steps but at a higher leverage cost: its latest $5.8 billion of capex equaled 100% of Q1 cash from operations, while MSFT sustains spending on a cash-flow juggernaut 4x larger. Kolanovic warns that if Oracle's AI investments don't deliver outsized returns, mounting depreciation could drag on forward earnings. Broadcom, trading at roughly twice its historical P/E and a 20% premium to Nvidia, has banked $110 billion on software buysprimarily VMwareto offset a capped communications-chip market. Yet with virtualization pricing hiked up to 1,200% in spots and minimum core buys steeped at 72 from 12, any pullback in AI spending or sentiment risks a sharp valuation reset. Investors should care because the AI capex bullwhip stretches from hyperscaler budgets through chips, hardware, integration and datacenter hosts, and any moderation can cascade quickly through this value chain. With Nvidia's next earnings on May 22, Oracle due May 22 and Broadcom reporting June 5, markets will scrutinize capex guidance and software deal pipelines for signs that the AI boom can be more than a two-year sprint. This article first appeared on GuruFocus. Sign in to access your portfolio
