Broader Market Falls as Chipmakers and AI Stocks Tumble

Economic Indicators - US MBA mortgage applications fell by -8.9% in the week ended January 30, with the purchase mortgage sub-index down -14.4% and the refinancing sub-index down -4.7% [1] - The January ADP employment change rose by +22,000, below expectations of +45,000, while the January ISM services index remained unchanged at 53.8, stronger than expectations of a decline to 53.5 [3] - Initial weekly unemployment claims are expected to increase by 3,000 to 212,000 [6] Stock Market Performance - Stock indexes settled mixed on Wednesday, with the S&P 500 down -0.51% and the Nasdaq 100 down -1.77%, while the Dow Jones Industrials Index closed up +0.53% [5] - Advanced Micro Devices (AMD) saw a significant drop of more than -17% after forecasting Q1 sales below projections, leading to a sell-off in chipmakers and AI-infrastructure stocks [4][14] - Super Micro Computer closed up more than +13% after forecasting Q3 net sales well above expectations, while Amgen closed up more than +8% after reporting stronger-than-expected Q4 revenue [3][20] Earnings Reports - Q4 earnings season is in full swing, with 81% of the 237 S&P 500 companies that have reported beating expectations, and S&P earnings growth is expected to climb by +8.4% in Q4 [7] - Eli Lilly reported Q4 revenue of $19.29 billion, stronger than the consensus of $18.01 billion, and forecasted full-year revenue of $80 billion to $83 billion [19] - Boston Scientific closed down more than -17% after forecasting full-year adjusted EPS below consensus [17] Treasury and Interest Rates - The Treasury announced a quarterly refunding totaling $125 billion in sales of T-notes and T-bonds, with auction sizes expected to remain unchanged for the next several quarters [2] - March 10-year T-notes closed up +0.5 of a tick, with the 10-year T-note yield rising +0.8 bp to 4.274% [9] - The Eurozone January core CPI was revised downward to +2.2% y/y, the smallest pace of increase in four years [12]