The latest Market Talks covering Technology, Media and Telecom. Published exclusively on Dow Jones Newswires at 4:20 ET, 12:20 ET and 16:50 ET.
0741 ET - Artificial-intelligence related stocks in the U.S. fall premarket, though losses are more muted than past days. Anxiety over AI spending and profitability challenges re-emerged last week after disappointing reports from Oracle and Broadcom, setting off a week of heavy selling. Broadcom edges down 0.3% premarket, following three consecutive days of losses in which it dropped 18% and shed $345.5 billion in market value--the largest three-day market cap decline on record. Oracle drops 0.2%. Elsewhere, CoreWeave--which has dropped 46% in the past six weeks--falls 0.6% premarket. Nvidia is one bright spot, up 0.3% premarket. Futures for the tech-heavy Nasdaq are down 0.2%, as the index fails to recover from three days of falls. (josephmichael.stonor@wsj.com)
0718 ET - Zillow shares sank Monday after Alphabet's Google said it was testing putting real estate listings directly into its search results, but fears of Google bypassing Zillow are overblown, say KeyBanc analysts. The worry is that Google will prioritize its own listings within search results, reducing visibility and traffic for Zillow. But Zillow gets only a small percentage of its traffic from search engine marketing, and managing real estate listings is highly complex and regulated, limiting the risk of disintermediation--or cutting out middlemen. Zillow shares could follow a similar trajectory to online travel stocks, which fell last month after Google announced AI-powered travel tools, but have since rebounded, the analysts say. (nicholas.miller@wsj.com)
0709 ET - Fund managers are increasing their allocation to technology stocks, even as investors say the magnificent seven companies--Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia and Tesla--are a crowded trade, Bank of America says in its December European fund manager survey. Managers surveyed are a net 21% overweight technology, a 12-point rise on last month, and the survey records the biggest rotation into tech stocks since July 2024. At the same time, 54% of fund managers say that "long magnificent seven" is the most crowded trade. Global fund managers are underweight energy more than any other equity sector, with energy at a net 26% underweight this month. (josephmichael.stonor@wsj.com)
0704 ET - Healthcare is the largest sector overweight for European fund managers, Bank of America says in its December European fund manager survey. Financials remain fund managers' preferred supersector, however, though weightings have slipped from June highs. Just shy of a quarter of those surveyed expect financials to be the best-performing sector over the next 12 months. Retail, food and beverages, and media remain the biggest underweights, while European fund managers judge tech and industrial goods as the most over-valued sectors. Germany is the continent's preferred equity market, while fund managers say they would underweight France more than any other country over the next year. (josephmichael.stonor@wsj.com)
0656 ET - Investors reduced their allocation to the euro in December, according to the latest Bank of America global fund manager survey. Investors also reduced allocation to bonds and healthcare stocks while increasing allocation to materials, technology and U.S. equities. The survey also showed a net 13% of investors think the euro is undervalued, unchanged from last month's survey. (renae.dyer@wsj.com)
0647 ET - Investor concerns about an AI bubble retreat slightly but remain elevated, Bank of America's global fund manager survey says. The vast majority of investors polled in the survey still view an AI bubble as the biggest 'tail risk'--a risk event that is unlikely but would cause hefty losses--, with 38% citing this, down from 45% in November's survey. A total of 19% of investors cite a disorderly rise in bond yields as the biggest tail risk. Private credit is added this month as a risk factor, with 14% of fund managers surveyed citing this as the biggest 'tail risk' over the coming year. (emese.bartha@wsj.com)
0541 ET - A return of global concern over the AI investment case sends European AI-related stocks down across the board. France's STMicroelectronics drops 2.05%, as falls for semiconductor companies ASML, BE Semiconductor and ASM drag the Netherlands' tech-dominated AEX index down 0.5%. The three companies fall 1.85%, 1.25% and 0.7%, respectively. The moves follow three days of falls in the tech-heavy Nasdaq, which closed 0.6% lower on Monday, as traders worry about an AI bubble and high capital expenditure. Asian trading also saw falls for tech stocks, including Hong Kong's Semiconductor Manufacturing International and the Taiwan Semiconductor Manufacturing Company. (josephmichael.stonor@wsj.com)
0349 ET - European indexes open mostly lower as defense stocks slump after the U.S. pledged to protect Ukraine from a future Russian attack. The German DAX is the biggest early mover, dropping 0.55% in part due to Rheinmetall, which tumbles 3.65%. The U.K.'s FTSE 100 drops 0.2% as BAE Systems and Babcock drop 2.4% and 2%, respectively. Italy's FTSE MIB 0.2% opens up as gains for banks outweigh a 3.3% drop for defense company Leonardo. Banks also pull the Spanish IBEX 35 to a 0.2% rise, even as Indra Sistemas drops 5%. Elsewhere, falls for AI-related companies hold the French CAC to par as STMicroelectronics drops 2.7%, while the Dutch AEX sheds 0.6% on losses for its microchip-related manufacturers. (josephmichael.stonor@wsj.com)
0026 ET - Xiaomi's smartphone margins should continue to face pressure as DRAM memory prices are expected to continue rising, Morningstar analyst Dan Baker says in a note. He forecasts five-year average revenue growth at 14.5% for Xiaomi, with earnings per share growth projected at 25%. Gross margins of the EV segment is expected to reach 27% by 2029, higher than industry leader BYD's 2024 margin of 20%. Morningstar maintains its medium-term growth forecast of 11% and a fair value estimate of HK$36.00, noting that Xiaomi's shares are overvalued due to excessive optimism over the EV business. Shares last traded at HK$40.48. (jason.chau@wsj.com)
2235 ET - The ongoing AI frenzy is extending the upward trajectory of the semiconductor cycle, which typically lasts four years, Morningstar analysts say in a research note. AI will likely continue to underpin memory chip demand in 2026, supporting sticky near-term memory prices, they say. New Chinese foundries have accelerated their expansion over the past two years but could slow down in the next few years due to limited cash flow to expand more quickly. Most manufacturers are hedging geopolitical risks with overseas sites, but Asia remains the top choice despite Western subsidies and tariffs, they say. Morningstar says TSMC is a primary AI beneficiary and Sino-American Silicon is "an undiscovered gem" as unit GlobalWafers is expanding globally. (sherry.qin@wsj.com)
1527 ET - ServiceNow's flurry of acquisitions this year could cause a stir amongst investors, KeyBanc Capital Markets analysts say in a note. The company has not historically pursued many acquisitions relative to other software companies of its size, but so far this year it has announced its two largest acquisitions to date, the analysts say. "If this M&A streak is the beginning of a trend and not just a one-time blip investors may not view it favorably," they say. Investors could grow concerned that the company's organic innovation is slowing as it moves into more areas outside its core business, they say. Investors could also argue that the billions spent on AI companies would have been better spent investing on internal projects or returned back to them, they say. The analysts note that they wrote the analysis before Bloomberg reported the company is nearing an agreement to buy Armis. (kelly.cloonan@wsj.com)
1329 ET - ServiceNow's federal business could come under pressure from lower government budgets in the coming years, KeyBanc Capital Markets analysts say in a note. Even though the Department of Government Efficiency didn't end up having as much of an effect on federal spending as feared, budgets could still get pushed down in the coming year or years due to a more hawkish stance, weighing on existing or new contracts for software vendors like ServiceNow, the analysts say. "Even in the absence of a frontal attack on the federal bureaucracy like we saw 10-12 months ago, the winds of federal spending are still likely moving against vendors," they say. (kelly.cloonan@wsj.com)
(END) Dow Jones Newswires
December 16, 2025 12:20 ET (17:20 GMT)
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