Market Talk
Volatile times.
One day it's AI hoopla. The next day Iran and the Middle East remind markets that continued conflict in energy-rich regions can have consequences.
The prevailing narrative remains that some near-term pain may be worth it if it leads to a more stable world. Markets, however, tend to focus on the immediate effects. Higher oil prices can eventually work their way through the economy, and inflation concerns begin to matter again.
Stock Talk
One area getting renewed attention is the PC and server side of the AI story. Both HP Inc. (HPQ) and Dell Technologies (DELL) surprised investors with earnings and continue to benefit from growing demand for AI-capable systems.
Part of the appeal is flexibility. Their hardware can incorporate processors from multiple vendors, including Intel and AMD, and potentially Nvidia's planned CPU offerings down the road. More competition may be coming, but it does not appear to be slowing enthusiasm for the sector at the moment.
Meanwhile, another AI story continues to develop behind the scenes.
As AI infrastructure expands, attention is increasingly turning toward power efficiency, electrical demand and faster computing. This brings several semiconductor manufacturers and designers into focus.
SkyWater Technology (SKYT) is in the process of being acquired. Wolfspeed (WOLF) remains unprofitable but is viewed by some as a leader in silicon carbide technologies. GlobalFoundries (GFS), meanwhile, remains profitable and continues expanding its manufacturing capabilities both in the United States and abroad.
The Jones Report previously discussed the relationship between GFS and Navitas Semiconductor (NVTS). Navitas designs gallium nitride (GaN) and silicon carbide (SiC) power semiconductors intended to improve electrical efficiency. GFS is expected to manufacture these devices at scale, supporting applications that range from AI infrastructure to industrial power systems.
As an aside, recent IPO Cerebras Systems (CBRS) has introduced a different approach to AI processing using a wafer-scale design roughly the size of a dinner plate. The stock initially surged above $300 following the IPO.
At the time, this report suggested letting the excitement settle and, if interested, considering no more than a single tracking share. The stock later faded below $220 and is floating back and forth.
Did CBRS find a bottom? Nobody knows at the moment.
However, one tracking share can remove much of the emotion while serving as a good "what if?" share to get the feel and follow the story.
Another area we've been watching is the miners. Despite higher gold prices and some encouraging earnings reports, the group still seems challenged. One concern may be the effect higher energy costs could have on sustaining costs.
One other stock we've been watching is V2X (VVX). It does not receive the attention of many of today's popular stories, yet the stock has quietly earned some respect while continuing to climb. Sometimes steady execution matters.
Quantum computing remains worth watching as well. QBTS continues expanding beyond its traditional annealing roots while benefiting from growing government interest and investment in the sector.
The psychedelic biotech story also continues to develop. CMPS has quietly crept higher while ATAI and HELP remain among the companies attempting to address difficult problems such as addiction and depression. The stories remain speculative, but some continue to watch the space.
Looking at the broader picture, GFS appears to be developing into more than just a traditional chip foundry. The company serves the "electronics of everything" while also expanding into areas such as photonics and advanced power semiconductors.
With an additional $375 million in recent U.S. government funding support, GFS remains a stock that appears to be showing some legs.
As always, investors should size positions accordingly and stay aware.
Things change fast.
Stay watchful.
- Jones Report
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More later so ....Stay tuned, if you dare!
For now, we close by noting that any view on the market and stocks on any particular day may change in the days to come. That is why we watch and see how our views match up with reality. Looking ahead a few months may be a way to do things - but thinking too deeply about world events and the recent alliances forming, can make projecting ahead a dicey endeavor.
All in all - we use the word maybe "some", not "too much" and play it accordingly. Never get arrogant in our notions because things do change - and individual stocks are subject to many factors outside our control. So, we try to -stay aware.
With all the above caveats and attempted prognostications, I will close this post. Stay tuned for more opining on the market and stocks to watch.
ALL in my humble opinion, scroll down and read more. This site does NOT make Buy / Sell recommendations.
