Investors began February with something of a shock, when artificial intelligence (AI) made clear that it’s not just changing industries and technology — it’s shaking markets to their foundations. Here’s what you need to know before selling. What Happened? Major American stock indexes suffered through nearly a week of losses in early February as anxiety over AI spending (and how its reduced need for coders could impact the revenues of multiple tech companies) shock waved throughout Wall Street, with stock ...

Core Viewpoint - Alphabet Inc. is preparing to issue a rare 100-year bond, aiming to raise approximately $20 billion to support its significant investments in artificial intelligence and other technologies, marking a notable shift in how tech companies are perceived in the financial market [1][2] Group 1: Century Bonds Overview - Century bonds are unique financial instruments typically issued by companies with exceptional longevity and financial resilience, often associated with blue-chip industrial firms rather than technology companies [1] - If Alphabet proceeds with this bond issuance, it will join a select group of corporations that have issued 100-year debt, including Ford Motor Co. and Motorola [1] - The rarity of century bonds makes them attractive to life insurance companies and pension funds, which seek long-term assets to match their obligations [1][2] Group 2: Investor Demand and Market Perception - Analysts expect strong demand for Alphabet's 100-year bond, with reports indicating over $100 billion in demand across various currencies and maturities, reflecting a sustained appetite for high-grade corporate debt [1][2] - The willingness of investors to commit capital to a technology company for a century indicates a shift in perception, viewing hyperscale tech firms as critical infrastructure rather than cyclical entities [2] - The strategic choice to issue the bond in sterling is seen as beneficial, as the UK market has a deep pool of investors familiar with ultra-long maturities [2] Group 3: Alphabet's Funding Strategy - The century bond issuance is part of a broader multi-tranche offering, including a seven-part dollar transaction and potential issuance in Swiss francs, showcasing a diversified funding approach [2] - Alphabet's previous bond issuance in November raised $17.5 billion, attracting approximately $90 billion in orders, indicating strong market interest [2]

A lot of market watchers are excited by the "January Barometer" or "January Indicator," which suggests that January's returns indicate the direction of stocks for the full year. The S&P 500 index was certainly up in January (although by just 1.37%). But tech investors might not want to pop the champagne just yet, because there's another historical trend we've seen in January that has dire implications for tech stocks in 2026. It may already be starting to play out. Where to invest $1,000 right now? Our an ...

Currency Movements - The U.S. dollar is experiencing a decline, influenced by a rebound in the yen, gains in China's yuan, and concerns over a weak U.S. employment report [3][5] - The yen's recovery is attributed to positive market sentiment regarding Japan's fiscal plans and a more stable political environment [4] - The yuan's rise is supported by regulatory warnings in China regarding concentrated holdings of U.S. Treasury bonds and the dollar, with the U.S. dollar at its lowest since May 2023, down nearly 6% against the renminbi over the past year [5] Technology Sector Developments - U.S. mega-cap tech stocks are rebounding after a previous decline, driven by significant capital expenditure plans exceeding $650 billion for 2026 [6] - Major tech companies, including Alphabet and Oracle, are engaging in debt financing, with Alphabet planning to raise an additional $15 billion in high-grade bonds [7] - The five leading AI hyperscalers issued $121 billion in U.S. bonds last year, a significant increase compared to an average of $28 billion per year in the previous four years [7] Regulatory and Political Context - The Trump administration is reportedly exempting major tech companies like Amazon, Google, and Microsoft from upcoming tariffs on chips, facilitating their expansion of AI data centers [8] - In the UK, political developments surrounding Prime Minister Keir Starmer's appointment of Lord Peter Mandelson as U.S. ambassador have caused market fluctuations, but support from the Labour Party has stabilized the situation [8]

By Yoruk Bahceli, Aditya Soni, Zaheer Kachwala and Matt Tracy Feb 10 (Reuters) - Alphabet on Tuesday sold a rare 100-year bond, a memo from the lead manager showed, part of a $31.51 billion global bond raise, as artificial intelligence-driven spending sparks a surge in borrowing at U.S. tech giants. Alphabet's sale of the ‌century bond is the tech industry's first since Motorola's issuance that dates back to 1997, according to LSEG data. "You have an extraordinary time period that we're ‌living throug ...

Core Viewpoint - Michael Burry suggests that Google's decision to issue 100-year debt indicates a potential decline in the company's dominance, drawing parallels to Motorola's decline after a similar bond issuance in 1997 [1][3]. Company Analysis - Alphabet (Google) is planning to issue 100-year bonds, a move that Burry associates with the decline of Motorola, which was the last year it was a dominant player in the market [2][3]. - By 2026, Motorola had significantly fallen in market cap, ranking 232nd with only $11 billion in sales, which Burry uses as a cautionary example for Alphabet [3]. Industry Context - Despite Burry's bearish outlook, Alphabet's business has shown continuous growth, particularly in artificial intelligence (AI) products, and its stock remains positive in early 2026 [5]. - However, Google's search market share has dropped below 90% for the first time in a decade, indicating a potential decline in its dominance [8]. - The decline in search quality and the rise of AI platforms like ChatGPT have contributed to this shift, leading to a significant drop in traffic for many media websites [9]. Market Sentiment - The stock market has reacted negatively to strong earnings reports from major tech firms like Microsoft, Amazon, and AMD, raising concerns about their exposure to AI and the potential for a recession [10][11]. - There are indications that previously announced AI infrastructure deals have been scaled back or canceled, adding to the uncertainty in the sector [12]. - The market-to-GDP ratio is at record highs, suggesting that any disruption could lead to significant market volatility [13].

Core Viewpoint - Alphabet and Amazon are planning unprecedented capital expenditures, with Alphabet potentially spending up to $185 billion and Amazon $200 billion this year, raising questions about investor willingness to finance these investments [1][2]. Group 1: Capital Expenditure Plans - Alphabet's capital spending could reach $185 billion, while Amazon's may hit $200 billion, marking the highest CapEx in history for such initiatives [1][2]. - Both companies have substantial cash reserves but prefer to raise funds through the market rather than depleting their cash [3]. Group 2: Investor Demand and Bond Issuance - Alphabet initially aimed to raise $15 billion but increased the target to $20 billion due to high investor demand, also planning to issue bonds in British pounds and Swiss francs [3]. - The issuance of a 100-year bond by Alphabet is notable, as such long-term bonds are rare for corporations, typically issued by governments or universities [4]. Group 3: Competitive Landscape - Major tech companies are increasing spending to compete aggressively in the "air race," aiming to secure a leading position in future markets [7][8]. - The competition among Alphabet, Amazon, Microsoft, and Meta is intense, with each company striving to capture significant market share and profits [8]. Group 4: Historical Context and Risks - The rarity of 100-year bonds raises concerns about long-term viability, as seen in past examples like Motorola and J.C. Penney, which faced significant challenges after issuing such bonds [11][12]. - Despite the risks associated with long-term bonds, Alphabet is currently viewed as a strong company with robust growth and aggressive investment strategies [13].

Core Viewpoint - The U.S. administration plans to exempt major tech firms like Amazon, Google, and Microsoft from upcoming tariffs on chips, facilitating their development of AI data centers [1] Group 1: Company Impact - Amazon, Google, and Microsoft are identified as key beneficiaries of the tariff exemption, which is aimed at supporting their AI infrastructure projects [1]

Core Viewpoint - The majority of the Magnificent Seven stocks have reported their latest quarterly financial results, revealing significant capital expenditure (CapEx) plans for 2026, estimated to reach $670 billion among four major tech companies [1][2]. CapEx Spending Overview - The estimated CapEx for 2026 includes: Meta Platforms up to $135 billion, Amazon.com up to $200 billion, Microsoft up to $150 billion, and Alphabet up to $185 billion [7]. - This $670 billion spending ranks as one of the largest in U.S. history, only trailing the Louisiana Purchase in terms of percentage of GDP [3][7]. Investor Sentiment - Investors are becoming cautious as the CapEx as a percentage of annual revenue rises, with Meta and Microsoft projected to exceed 30% of their annual revenue in 2025, and Meta potentially surpassing 50% for the first time [4]. - Despite strong earnings reports, the mixed results from investors indicate a reluctance to embrace increased CapEx without corresponding growth [5][9]. Stock Performance - Year-to-date returns for the four companies show mixed results: Meta +4.4%, Amazon -7.8%, Microsoft -12.8%, and Alphabet +2.7%, with Alphabet being the only one outperforming the S&P 500's one-year gain of +14.8% [6][8]. - The increase in CapEx, particularly Amazon's 60% rise, has negatively impacted its stock performance, highlighting investor skepticism towards high spending without clear growth justification [9].

History was made as Alphabet ( GOOG/ GOOGL ), a firm that has existed for less than 30 years, announced plans to sell 100-year bonds as part of their debt issuance this year. Bloomberg is reporting that theyNewsletter Author | Investment Advisor | Top 5% of Experts on TipRanks | Long Signal, Short Noise | The Macro Obsession newsletter is a weekly brief on current events and trends in finance, tech, and the real economy. I am a macro-oriented and data-driven investor who obsesses over connecting dots that o ...