Squawk on the Street SOTS 2nd Hour: M&A Under Trump, Tariff Tech Picks, & DeepSeek-ing New Funds? 2/19/25
Feb 19, 2025
Market turbulence is front and center as President Trump threatens tariffs on key industries, causing stock fluctuations. Noteworthy stock declines include Toll Brothers and Bumble, while energy stocks show signs of recovery. The tech sector's future is under scrutiny, with insights on the AI arms race and merger regulations. The Future Investment Initiative’s Priority Summit garners attention, bringing discussions on purposeful investing and the balance between energy production and environmental concerns.
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Market Dynamics
- The market is getting reconditioned to the pace of news, learning to differentiate between substantive information and noise.
- Positive economic conditions and strong earnings are supporting current valuations, with the market rotating effectively.
Trump's Tariff Strategy
- President Trump is using tariff threats as a negotiation tactic, creating uncertainty while signaling flexibility.
- He aims for maximum leverage by keeping industries guessing about the actual implementation and impact of tariffs.
AI Chip Demand Surge
- Demand for AI chips, especially from NVIDIA, is surging in Asia, outpacing supply by a significant margin.
- This demand is driving a tech stock surge, with companies prioritizing securing their supply of essential AI chips.