Palantir Investors Don't Care What Wall Street Analysts Say

Market action was extremely choppy on Thursday, with rotation back into the Magnificent Seven MAGS and negative breadth. A late spike pushed the Nasdaq 100 QQQ to a gain of 0.5%, but small-caps IWM went from green to red and lost 0.4%.

There continue to be very aggressive pockets of momentum, such as Palantir Technologies PLTR. Investors continued to pile into it even though the average analyst rating is a "hold" with a price target of $88.60 versus the current price of around $111. The stock is now trading as if valuation is meaningless, and the only thing that matters is that there are buyers willing to buy it even higher. Eventually, that will stop working, but this sort of action tends to persist for much longer than seems reasonable.

Market players are assessing Amazon's AMZN earnings report, which arrived after the bell. EPS is ahead, but revenues are mostly in line. The stock was hit initially on the headlines but is bouncing back a bit. The most important issues here will be cloud revenue and AI infrastructure spending, but the initial reaction is that this report isn’t good enough to bring in chasers. However, the conference call is key.

The January jobs report will be issued Friday morning and is likely to generate a market reaction, but overall, the market is becoming a bit frothy, and the action is becoming sloppy and volatile. We may need some corrective action to help set things up for more upside. Some additional caution is warranted.

Have a good evening. I’ll see you Friday.

At the time of publication, Rev Shark had no positions in any securities mentioned.