MPC Morning Call 12th November 2025 – Investors switch out of Tech on record valuations, depreciation red flags

Overnight – Investors switch out of Tech on record valuations, depreciation red flags

Tech fell as the DOW rallied as investors weighed up record valuations, AI Chip depreciation & the long-running government shutdown.

Nvidia shares led a decline in AI stocks after SoftBank sold its entire $5.83 billion stake to pivot its investments toward OpenAI. Nvidia-backed CoreWeave also saw its stock drop due to delays with a third-party data center partner, overshadowing strong quarterly results and major deals with OpenAI and Meta. Meanwhile, Paramount Skydance rose on new cost-cutting plans, Rocket Lab gained after reporting a narrower loss, and TheRealReal surged after raising revenue guidance.

In Washington, the U.S. Senate passed a spending bill to end the record-long federal government shutdown, with bipartisan support paving the way for passage in the House and approval by President Donald Trump. Analysts said the resolution could spark a year-end rally, and Wall Street closed higher previously, led by AI stocks including Nvidia and Palantir.

UBS projected the S&P 500 could reach 7,500 next year from 5,830, driven by 14% earnings growth—around half from technology companies. The bank expects the global economy to accelerate in 2026 but cautioned that advanced economies face short-term challenges due to lingering tariff effects. UBS forecasts U.S. equities will outperform globally with roughly 10% returns in the next year, fueled mainly by earnings strength rather than valuation expansion.

Corporate Earnings

• Paramount Skydance +9.93% – stock rose after the entertainment company said it is looking to cut an additional $1 billion in savings after first outlining $2 billion when it completed its merger in August. 
• Rocket Lab -1.25% – stock jumped higher after the space company reported a smaller third-quarter loss than expected.