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Wednesday, February 19

Recent market movements are heavily influenced by U.S. President Donald Trump's announcement of potential tariffs on automobile, semiconductor, and pharmaceutical imports set to be around 25%. This news has raised concerns about escalating trade tensions and their impact on global markets, leading to a cautious sentiment among investors as they await further developments.

January housing starts in the United States reported a seasonally adjusted annual rate of 1.366 million units, which represented a significant decline of -9.8% from December's revised total of 1.515 million units (previously reported as approximately 1.499 million) and building permits was reported 1.483 million permits issued, surpassing market expectations of a decline to approximately 1.460 million. Market expectations had anticipated slightly higher figures with consensus estimates predicting an annualized rate around 1.390 million. Furthermore, later today at 19:00 GMT, minutes from the Federal Reserve's January meeting will offer clues regarding future monetary policy direction amidst ongoing discussions about interest rates.

European equity indices have shown weakness following mixed signals from recent economic indicators within major economies like Germany and France. The European Central Bank (ECB) faces challenges with persistent signs of economic slowdown that may influence its rate-cutting strategy moving forward while also reacting negatively to geopolitical uncertainties stemming from U.S.-China relations over trade policies.

SPDR Dow Jones Industrial Average ETF Trust (DIA) [-0.2%]
The SPDR Dow Jones Industrial Average ETF Trust (DIA) has seen a slight decline of 0.2% in pre-market trading, coinciding with a marginal drop in the Dow Jones Index. This follows President Trump's announcement of new tariffs on various sectors, raising concerns about potential trade tensions. Additionally, geopolitical uncertainties surrounding Ukraine are contributing to a cautious atmosphere in U.S. equities. Among the ETF's holdings, notable declines were observed in Intel Corp, which has faced significant bearish sentiment from analysts due to operational challenges and lowered price targets. Other contributors to the ETF's performance included Home Depot, UnitedHealth, and Nike, all of which recorded negative returns. The S&P 500 Index also registered a minor decline, reflecting broader market sentiment that may influence DIA's movement.

iShares MSCI United Kingdom ETF (EWU) [-0.8%]
The iShares MSCI United Kingdom ETF (EWU) has seen a daily return drop of approximately 0.81%, influenced by President Trump's announcement regarding 25% tariffs on various imports, raising concerns about trade tensions. Concurrently, rising U.S. Treasury yields are contributing to a cautious market environment. In macroeconomic news, the U.K. Consumer Price Index for January decreased month-over-month but rose year-over-year, exceeding expectations. The Producer Price Index Input also increased more than anticipated, indicating potential inflationary pressures. The FTSE 100 index is trading lower, reflecting broader market declines in Europe. Additionally, the GBP/USD currency pair has declined, contributing to the ETF's performance. Among the ETF's holdings, HSBC reported improved earnings but a decline in revenue, while Rio Tinto announced a significant acquisition related to iron ore production.

ADI | +5.0% | +5.7B
Analog Devices Inc | Semiconductors
Analog Devices Inc. reported first-quarter results that exceeded analyst expectations, with adjusted earnings per share (EPS) of 1.63, surpassing the consensus estimate of 1.54. Revenue for the quarter reached 2.423 billion, above the anticipated 2.358 billion. The company projected second-quarter revenue between 2.40 billion and 2.60 billion, with expected adjusted EPS of 1.68, compared to the consensus estimate of 1.66. Additionally, Analog Devices announced an 8% increase in its quarterly dividend to 0.99 per share and authorized a $10 billion increase in its share repurchase program, raising the total buyback capacity to approximately 11.5 billion. These announcements were made amid a challenging macroeconomic environment but reflect a commitment to returning value to shareholders.

ANET | -4.9% | -1.6B
Arista Networks Inc | Communications Equipment
Arista Networks Inc reported its fourth-quarter financial results, posting an adjusted EPS of 0.65, surpassing the analyst estimate of 0.57. Revenue for the quarter reached 1.93 billion, exceeding the consensus estimate of 1.90 billion and marking a year-over-year increase of 25.3%. The company's net income was 801 million, up from 614 million in the same period last year. For the first quarter of 2025, Arista anticipates revenue between 1.93 billion and 1.97 billion, slightly above the estimated 1.91 billion. Following the earnings announcement, there was a notable after-hours trading response, with shares initially rising by nearly 4%. However, approximately 50 minutes after the event, shares dropped significantly by 6.5%. Social media discussions highlighted these results, though some users expressed concerns regarding future growth potential and operating margin pressures.

WIX | +5.3% | +704.8M
Wix.Com Ltd | Internet Services & Infrastructure
Wix.com Ltd reported its fourth-quarter results, achieving an adjusted EPS of 1.93, surpassing the expected 1.61, and reflecting a significant year-over-year increase. Revenue for the quarter was 460.5 million, which, while a 14% rise year-over-year, fell slightly short of the consensus estimate of 461.75 million. The company provided guidance for first-quarter revenues between 469 million and 473 million, below the anticipated 480.7 million. For full-year 2025, Wix expects revenues of 1.97 billion to 2 billion, also below the consensus of 2.02 billion. Total bookings increased by 18% year-over-year, with creative subscriptions rising to 325.2 million and business solutions revenue up 25% to 139.4 million. Social media discussions have been active regarding these results and guidance updates, contributing to a notable price increase of 5.3%.

CDNS | -2.4% | -2.0B
Cadence Design Systems Inc | Application Software
Cadence Design Systems Inc. reported its fourth-quarter financial results, revealing a revenue of $1.36 billion, surpassing estimates of $1.35 billion, and an adjusted EPS of $1.88 compared to the expected $1.82. Despite this strong performance, the company provided a fiscal year 2025 outlook that fell short of analysts' expectations, projecting adjusted EPS between $6.65 and $6.75, below the consensus estimate of $6.83. Additionally, expected revenue for 2025 is estimated at $5.14 billion to $5.22 billion, also under the forecasted $5.25 billion. Following these announcements, shares experienced a decline in after-hours trading, reflecting market reaction to the soft guidance amid concerns over demand for chip software. Social media discussions highlighted both the mixed financial performance and the stock's subsequent decline, with shares reportedly dropping significantly in after-hours trading following the earnings report.

INTC | -3.3% | -3.7B
Intel Corp | Semiconductors
Intel Corp is currently facing a predominantly bearish outlook from analysts, with 10 out of 13 rating the stock as indifferent or bearish. The average price target has dropped significantly to 22.31, a decline from the previous average of 23.62. Notable reductions in targets include Harlan Sur from JP Morgan, who lowered his target from 26.00 to 23.00, and Ruben Roy from Stifel, who adjusted his target from 25.00 to 21.00. Financial metrics indicate challenges, with a revenue decline of approximately 7.44% over three months and a net margin of -0.88%. Social media discussions highlight potential acquisitions of various Intel segments by Taiwan Semiconductor Manufacturing and Broadcom, as well as exclusive talks for a buyout of Intel's Altera business by Silver Lake Capital. Meanwhile, U.S. President Trump's tariff announcement on imported semiconductors could impact Intel's operations.

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