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Speaker 1: Stephanie Bachelor, Milford Asset Management with US Tonight. Steph, Hello,

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Speaker 1: Hi Ryan. Now there's been a big sell off in

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Speaker 1: the US markets this week. Of course, we're getting close

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Speaker 1: now to correction territory, which is ten percent off the peak.

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Speaker 1: What's the latest tire?

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Speaker 2: Yeah, So the US market, the S and P five

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Speaker 2: hundred index is down nine point three percent from its peak,

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Speaker 2: so it is very close to that ten percent mark.

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Speaker 2: And it's really due to invest a concern around as

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Speaker 2: slowing in US economic growth. So as the Trump administration

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Speaker 2: is settled in, they they've announced a bunch of policies

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Speaker 2: or potential policies that could dampen growth. These are things

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Speaker 2: like trade tariffs and cuts to government spending. Over the weekend,

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Speaker 2: Trump didn't rule out potential recession, so he said there's

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Speaker 2: going to be a period of transition with what they're doing,

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Speaker 2: and that led to another almost three percent pullback on Monday.

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Speaker 2: Then overnight he actually reversed course of it. He downplayed that,

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Speaker 2: saying he didn't foresee the US going into a recession

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Speaker 2: and he thinks the country is going to boom, which

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Speaker 2: did help to cushion a further fall that had started

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Speaker 2: after he threatened more tariffs on Canada. So it's a

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Speaker 2: little bit all over the place at the moment.

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Speaker 1: It certainly is now the tech companies, the Magnificent Seven,

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Speaker 1: which are Kream Della Cream of the tech companies, they

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Speaker 1: have actually been hit harder than most than the broader market.

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Speaker 1: Is this a sign that you are they leading the

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Speaker 1: market here or is there tech specific things going on?

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Speaker 2: Yeah, there are some tech specific things happening, So it's

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Speaker 2: the concern is primarily around the amount that these companies

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Speaker 2: are spending on things like artificial intelligence, and there are

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Speaker 2: questions around whether they're actually going to be able to

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Speaker 2: generate a sufficient return on that spend. So we had

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Speaker 2: the emergence of deep Seek, which raised concerns on this

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Speaker 2: front back at the end of jan and more recently

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Speaker 2: there have been rumors around Microsoft postponing and canceling data

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Speaker 2: center leases, so that's added to some of those And

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Speaker 2: if you think about the very strong run that some

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Speaker 2: of these companies have had, you know, some of the

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Speaker 2: valuations were elevated, and they're also more sensitive to growth

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Speaker 2: and momentum, so as you would expect, they have sold

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Speaker 2: off more than the broader market. The Nasdaq is down

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Speaker 2: about twelve and a half percent, and the Mags seven

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Speaker 2: are down even more from the peak.

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Speaker 1: It's interesting if you look at the Magnificent seven and

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Speaker 1: you look at Meta, they're the only one so far

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Speaker 1: this year who's actually managed to managed to get a

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Speaker 1: positive return. What's with that?

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Speaker 2: Yeah, So that one really comes down to the fact

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Speaker 2: that Meta is viewed as having one of the most

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Speaker 2: compelling early AI monetization opportunities. So if you think about

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Speaker 2: how Meta actually makes money, it's through advertising, and it

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Speaker 2: was already a leader in targeted advertising, and its investments

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Speaker 2: in AI are really just helping to extend that lead.

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Speaker 2: So they're helping advertisers create better ads, better target the

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Speaker 2: right users, and then that in turn helps to improve

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Speaker 2: user engagement. It keeps us all scrolling on those apps,

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Speaker 2: and then it's able to better measure how well the

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Speaker 2: aids are doing, which gives advertisers the confidence to keep

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Speaker 2: coming back and using metas advertising platform. And you know,

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Speaker 2: given I think it's around half the world's population uses

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Speaker 2: a Meta app each month, it's got a huge base

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Speaker 2: of customers to roll those initiatives out too. So it's

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Speaker 2: starting in a pretty good spot.

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Speaker 1: And we had a lot of change in the Nvidia

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Speaker 1: stock over the fares of deep seek over in China.

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Speaker 1: But now there's news that's come out that's hit their stock.

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Speaker 1: News out of Singapore.

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Speaker 2: Yeah, so that was our last week. It sent the

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Speaker 2: stop down eight percent on the day, and it was

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Speaker 2: news that Singapore is investigating three people that are thought

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Speaker 2: to be involved in smuggling in video chips. So the

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Speaker 2: buyers appeared to be officially buying them from Singapore, but

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Speaker 2: it looks like they might have actually ended up in China,

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Speaker 2: which would have been in violin of US sanctions. And

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Speaker 2: so the reason in video stock fell so much is

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Speaker 2: that Singapore accounted for almost twenty percent of in videos

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Speaker 2: revenue last year, So depending on what the investigation finds,

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Speaker 2: there's a risk that a portion of those sales are

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Speaker 2: illegal and would then fall away going forward. So for

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Speaker 2: a stock that depends on constant upgrades and growing revenue,

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Speaker 2: it's not a good outcome.

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Speaker 1: Interesting, Stephanie, Thank you, Stephanie Batcheler, Milforde said management. For

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Speaker 1: more from Heather Duplessy Allen Drive, listen live to news talks.

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