Palantir Rises, the $12B Mineral Plan, Musk's Big Deal
We've got lots to cover: Palantir's beat, Trump's rare earths plan, India's tariff deal, a Musk proposal that's out of this world.
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Burning Heart
In the burning heart
Just about to burst
There's a quest for answers
An unquenchable thirst
In the darkest night
Rising like a spire
In the burning heart
The unmistakable fire
- Sullivan, Peterik (Survivor), 1985
Like a Phoenix
Not as long ago as one might think. I was already a middle-aged man, probably in my late 40s. My team was made up of 18-to-22 years olds. We were set up pretty well. No human could have picked up on our location without using some kind of tool that could read a heat signature. Seemingly out of nowhere and running at a terrific pace came two large perfectly white bucks.
I mean these two bucks had full racks, so they were mature bachelors. They were both albinos, which I thought was a little odd. I had seen albinos out in the wilderness before, but two traveling together. My guys? They wanted to panic. They thought these two bucks were ghosts or were sent from above (or below) as a message. We were supposed to be silent and still. I started seeing "signs of the cross" and hearing prayers in a native American tongue. It got worse.
These two bucks, running at a true gallop from our left front, nearly ran right into our position, when one of them finally picked up our scent. They stopped literally about 15 feet to our front. My guys, tough guys who show no fear, were terrified. These guys would not show fear if these were dangerous beasts, which they really were not, but they thought these two to be supernatural.
I broke from my spot to intentionally scare the bucks away and they took off. I had to get the guys to pipe down and restore some discipline. Only problem was, my guys thought then, that maybe I was screwing around with forces that I did not understand. The two deer scampered off and that was that. They were truly majestic animals to see. However, something did affect those men that day.
Something similar happened to the stock market after the close of business on Monday. Palantir Technologies (PLTR) reported fourth- quarter financial results. The company did not just "beat" expectations, it grew revenues by more than 69% year over year and grew their commercial business by 137% year over year. Poof.
Just like that, a market for tech stocks that had been under pressure for days reversed course. The AI-trade itself, that had been under pressure for days, even for weeks, reversed. it is still the middle of the night for most folks where I am, but PLTR is up more than 11% overnight. Will those gains hold? How do I answer that question at this time?
I will tell you that the chart has improved technically and I will come back with a feature article in a couple of hours as I know that many readers are in this stock and might be in this stock simply because I am in this stock. I understand my responsibility to you. For one night though, CEO Alex Karp and CRO Ryan Taylor were a couple of white bucks that came out of nowhere and may have saved, for now, the U.S. stock market.
There's More...
On Monday, Bloomberg News reported that the U.S. government would launch a $12 billion critical minerals stockpile, or if you will, a "strategic reserve." The project will include $10 billion in debt financing to be provided by the U.S. Export-Import Bank and an additional nearly $2 billion will come from private sector investors. Dubbed "Project Vault", this reserve will be stocked with rare earths, critical minerals such as lithium and key building materials such as copper. "Oh, baybay."
On the corporate side, General Motors (GM) , Boeing (BA) , GE Vernova (GEV) and Alphabet (GOOGL) have already signed on as participants. Three commodities-focused broker-dealers, Hartree Partners, Traxys North America and Mercuria Energy have agreed to execute the necessary transactions and to fill the reserve.
Such a Deal, Part One: India
The Wall Street Journal, among other outlets, reported on Monday afternoon, that the U.S. had agreed to reduce tariffs on goods imported from India to 18% on the condition that India had agreed to halt all purchases of crude oil from the Russian Federation. Readers will recall that last year, Pres. Trump imposed a 25% tariff on imported Indian goods in response to those purchases of Russian oil, while also imposing a 25% "reciprocal" tariff on those goods.
So, for many Indian products trying to meet U.S. demand, these tariffs are dropping all the way from 50% to 18%. In addition, Pres. Trump added that India would "move forward to reduce their tariffs and non-tariff barriers on US goods imported into that country down to ZERO." India has also committed to purchase $500 billion worth of U.S. energy and agricultural products. Needless to say, the Sensex Index (India's measure of stock market performance) was up 2.54% on the news.
Marketplace
Equity markets reacted well to last week's test of the 50-day simple moving average of the S&P 500 on Monday as well as to the news flow. The Dow Transports ran the table, gaining 3.15% for the day, led by truckers Landstar (LSTR) and Old Dominion (ODFL) . That's a positive signal for any coming increase in economic activity.
As for the headline-level indexes, the Nasdaq Composite gained 0.56% on Monday. Remember, we talked about the Ascending Triangle on that chart. That's a bullish pattern. The S&P 500 tacked 0.54% itself, putting a halt to the pressure that our broadest large cap index had been under. The small to mid-cap indexes all tacked on anywhere from 0.88% to 1.11% for the session. In fact, out of the 10 U.S. equity indexes that I track all day long, none did worse than gain 0.54% on Monday and that was the S&P 500.
Moving on to breadth, seven of the 11 S&P SPDR sector ETFs closed out the day in the green, led by the Industrials (XLI) , the Staples (XLP) and the Financials (XLF) . Energy (XLE) and the Utilities (XLU) badly lagged. One can see that there was no discernable break in performance between cyclicals and defensives, which makes it a little more difficult to read the teal leaves.
Winners beat losers by a rough seven to five at the NYSE and by about four to three at the Nasdaq. Advancing volume did not roar but did take a majority share of the action for names domiciled both at 11 Wall St. and up at Times Square. Aggregate trade took the day off. Activity embedded day over day across NYSE-listings, across Nasdaq-listings and across the membership of the S&P 500.
Does that reduced activity render Monday's victories somewhat less meaningful? You bet your tail it does. Let's see what today brings, post-Palantir and pre- Advanced Micro Devices (AMD) . Be ready for anything.
Such a Deal, Part Two: Musk Plan
Tesla (TSLA) and "X" (formerly Twitter) owner Elon Musk is combining his still private space exploration company SpaceX with his gen AI company xAI in a deal that values the whole ball of wax at $1.25 trillion. Separately, SpaceX would be valued at $1 trillion and xAI at $250 million. The merger comes ahead of the expected SpaceX initial public offering set to come to market later this year, which is likely to be the biggest IPO in the history of U.S. markets and raise up to $50 billion.
In Other News....
- The partial government shutdown has already hit the flow of macroeconomic data that feeds traders, investors and policy makers. The Bureau of Labor Statistics has announced that the results of its January labor market surveys will not be released this Friday morning as previously planned.
- The ISM Manufacturing Index, at the headline, printed in a state of expansion for January. This was the first positive for series since February 2025. There was a noticeable month-over-month increase in new orders, backlog of orders, and production. On the negative side, prices held at lofty levels, while manufacturing-based employment continued to contract as it has for 28 consecutive months now.
Economics
(All Times Eastern)
08:55 - Redbook (Weekly): Last 7.1% y/y.
10:00 - JOLTs Job Openings (Dec): Last 7.146M.
10:00 - JOLTs Job Quits (Dec): Last 3.161M.
4:30 p.m. - API Oil Inventories (Weekly): Last -250K.
The Fed
(All Times Eastern)
08:00 - Speaker: Richmond Fed Pres. Tom Barkin.
Today's Earnings Highlights
(Consensus EPS Expectations)
Before the Open: (ADM) (.80), (MRK) (2.01), (PYPL) (1.29), (PEP) (2.24), (PFE) (.57)
After the Close: (AMD) (1.32), (AMGN) (4.76), (MTCH) (1.02), (SMCI) (.49), (TTWO) (.83)
At the time of publication, Guilfoyle was long AMD, PLTR equity.
