MARKET WRAPS
STOCKS: Stocks fell sharply due to investor jitters about labor market data and the impact of AI on the software industry.
TREASURYS: Treasury yields fell after weak jobs data spurred safe-haven demand.
FOREX: The U.S. dollar rose against peers amid volatility in precious metals and digital-currency markets.
COMMODITIES: Oil futures ahead of talks planned for tomorrow in Oman between the U.S. and Iran.
HEADLINES
Amazon to Spend $200 Billion as It Accelerates AI Projects
Amazon.com reported that sales rose to $213.4 billion in the fourth quarter, following a solid holiday shopping season and strong growth in the company's data-center business.
Net profit for the period was $21.2 billion, in line with analyst expectations of $21.1 billion, according to FactSet. The company is increasing artificial-intelligence related spending, while cutting costs, laying off another 16,000 staffers and shuttering underperforming businesses.
The company said it expected to make capital expenditures of $200 billion in 2026, as the company accelerates spending on artificial-intelligence projects.
Weak Hiring, Layoff Plans Paint a Gloomy Labor-Market Picture
The U.S. job market is off to a rough start in the new year, with companies announcing more layoff plans after freezing out job seekers, cutting back on hiring, and rattling markets.
More reports out Thursday, from both government and private data sources, point to sluggish job growth, employers' reluctance to hire, and rising willingness to slash payrolls. They are filling in a picture of a labor market that slowed considerably in 2025 as economists wait for the government's official January report, due next week.
The S&P 500, Dow industrials and Nasdaq composite fell roughly 0.7% following the news on jobs, as well as over jitters regarding tech stocks.
Volkswagen, UAW Agree to 20% Wage Hike for Tennessee Plant Workers
More than 3,000 hourly workers at Volkswagen's assembly plant in Chattanooga, Tenn., would receive raises totaling about 20% over four years under a new tentative deal between the German automaker and the United Auto Workers, according to the union.
The agreement jointly announced late Wednesday by the company and UAW also includes enhanced healthcare benefits and other gains after nearly a year-and-a-half of negotiations. Workers still have to vote to ratify the deal.
For the union, the stakes of its pending agreement with Volkswagen are especially high, as it aims to persuade more U.S. autoworkers in the South to join the UAW.
Hershey Expects Higher Prices to Boost 2026 Profit
Hershey issued a strong 2026 outlook, expecting price increases announced last year to boost revenue and profit even amid cautious consumer sentiment.
The company said it now expected less volume sensitivity to its price hikes than it had previously planned. Hershey said in the middle of last year that it would impose a double-digit percentage price increase as a result of high cocoa costs.
The company said Thursday that in addition to product innovation and marketing, the price increases would help drive expected 2.5% to 3.5% organic sales growth in 2026.
KKR to Acquire Pro Sports Investor Arctos in $1.4 Billion Deal
KKR agreed to acquire Arctos Partners, an investor in professional sports franchise stakes, in a deal initially valued at $1.4 billion.
The initial consideration KKR will pay includes $300 million in cash, $900 million of equity to existing Arctos shareholders and $200 million of additional equity to be allocated by 2028 and subject to vesting through 2033.
The deal also includes an additional $550 million in future equity tied to both KKR share price and business-specific performance targets and vesting through 2031.
Novo Nordisk Accuses Hims & Hers of 'Illegal Mass Compounding' Over Cheaper Wegovy Version
Novo Nordisk accused Hims & Hers of "illegal mass compounding" after the telehealth platform said it would offer a cheaper, compounded version of the Wegovy pill.
Earlier Thursday, Hims & Hers said it would begin offering copies of Wegovy for an introductory price of $49 for the first month with a five-month plan, with the version made from the same active ingredient, semaglutide, as Novo Nordisk's treatment.
Novo said the move from Hims & Hers "poses a significant risk to patient safety." The Danish drugmaker, which sells semaglutide as Ozempic and Rybelsus for type 2 diabetes and Wegovy for weight loss, also said it plans to take legal and regulatory action against Hims & Hers.
Atlanta Fed's Bostic Makes the Case for Keeping Interest Rates Steady
It appears most Federal Reserve officials remain committed to keeping interest rates steady in the near term, including Atlanta Fed President Raphael Bostic.
On Thursday, Bostic was the latest policymaker to stress the importance of keeping the central bank's benchmark interest rate unchanged to help bring inflation sustainably down to the Fed's goal of 2%.
"For me, inflation has been too high for too long," Bostic said during an event at Clark Atlanta University's School of Business on Thursday. "It's important that our policy stay at a moderately restrictive posture, because that is a posture that increases the likelihood that we will get inflation back to our 2% target."
Google Leans Hard Into Its AI-Winner Status
The motto for the artificial-intelligence race today should be if you've got it, spend it.
That is a message that Meta Platforms took to heart during its fourth-quarter report last week, when the Facebook and Instagram parent announced plans to spend up to $135 billion on capital expenditures this year, compared with about $72 billion last year. Google managed to up the ante Wednesday with its own plan to spend as much as $185 billion this year, which would be about double last year's outlay.
Google's annual revenue has now topped $400 billion, about twice as large as Meta's. Still, that new spending target, even for a company that has been firing on all cylinders lately, takes one's breath away. The stock price of Google's parent, Alphabet, slipped in after-hours trading Wednesday after its fourth-quarter report and conference call.
ConocoPhillips Posts Weaker Profit on Lower Prices
ConocoPhillips' fourth-quarter earnings fell, hurt by lower prices that were slightly offset by higher production.
The Houston-based oil producer on Thursday posted a profit of $1.44 billion, or $1.17 a share, compared with $2.31 billion, or $1.90 a share, a year earlier.
Stripping out one-time items, primarily relating to a gain on asset sales and restructuring costs, earnings were $1.02 a share. Analysts polled by FactSet expected adjusted earnings of $1.07 a share.
TALKING POINT It's a Time of Rapid Change. How to Protect Your Retirement Portfolio.
A sweeping selloff in software and services stocks should be a wake-up call for retirees. Your portfolio needs to be well diversified, and things that might seem safe-notably gold-may not fit the bill anymore.
"When we're in a period of rapid change, diversification is the best tool at your disposal to manage risk," says Thierry Wizman, global FX and rates strategist at Macquarie Group.
International markets look attractive. Non-U.S. markets aren't nearly as tech heavy as the S&P 500 index, and they're getting a lift from a weakening dollar, which is down about 7% against a basket of major currencies since the start of 2025.
Geopolitics tend to drive the dollar, which often moves in long cycles, Wizman says. America's trade and economic policies under President Donald Trump have spurred flows out of U.S. dollar assets as global investors seek to hedge their exposure to America. The depreciation that began in 2025 could last for a decade, he notes.
That doesn't mean you should "sell America," as one popular trade is known. There's still a strong case for investing in U.S. assets, including tech innovation like artificial intelligence. While AI may be hurting some software and services industries, it's also expected to boost U.S. productivity, which is positive for economic growth.
Still, diversifying out of the dollar makes sense, and it doesn't to have be as complicated as trading currencies. It's enough to hold stocks in non-U.S. companies, which you can access through exchange-traded funds like the Vanguard FTSE All-World ex-US. A general rule is to hold international stocks in proportion to their world market cap, which would mean about 35% of your equity portfolio.
--Elizabeth O'Brien, Barron's
Expected Major Events for Friday
05:00/JPN: Dec Indexes of Business Conditions - Preliminary Release
07:00/GER: Dec Foreign Trade
07:00/UK: Jan Halifax House Price Index
07:00/GER: Dec Industrial Production Index
07:45/FRA: Dec Foreign trade
07:45/FRA: Dec Balance of payments
13:30/CAN: Dec Stocks of Canadian grain at Dec 31
13:30/CAN: Jan Labour Force Survey
15:00/US: Dec Metropolitan Area Employment and Unemployment
15:00/CAN: Jan Ivey Purchasing Managers Index
15:00/US: Feb University of Michigan Survey of Consumers - preliminary
20:00/US: Dec Consumer Credit
All times in GMT. Powered by Onclusive and Dow Jones.
Expected Earnings for Friday
Amerityre Corp (AMTY) is expected to report for 2Q.
AutoNation Inc $(AN)$ is expected to report $4.77 for 4Q.
Biogen Inc $(BIIB)$ is expected to report $1.07 for 4Q.
Black Titan Corp $(BTTC)$ is expected to report for 3Q.
Canopy Growth Corp (CGC,WEED.T) is expected to report for 3Q.
Carlyle Group Inc $(CG)$ is expected to report $1.02 for 4Q.
Cboe Global Markets Inc $(CBOE)$ is expected to report $2.90 for 4Q.
Centene Corp $(CNC)$ is expected to report $-1.49 for 4Q.
EVI Industries Inc (EVI) is expected to report $0.16 for 2Q.
Enanta Pharmaceuticals Inc $(ENTA)$ is expected to report $-0.77 for 1Q.
(MORE TO FOLLOW) Dow Jones Newswires
February 05, 2026 16:38 ET (21:38 GMT)
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