Key Points

• Amazon-led Tech Slide Deepens: Amazon’s earnings miss and $200B capex forecast drove an 11% drop in its stock, accelerating a tech-sector sell-off that pushed the Nasdaq toward its worst week since April.
• Stellantis Sinks on $26B EV Overhaul Charge: Shares plunged 20% after the automaker revealed a €22B write-down linked to its EV transition missteps and suspended its dividend amid a broader strategic reset.
• AI Disruption Hammers Software Stocks: New AI tools from Anthropic triggered a 20% YTD drop in the software sector, with investors re-evaluating long-term viability of SaaS models amid rising automation fears.
• India Eyes $80B Boeing Deal in U.S. Trade Pivot: India is poised to finalize a massive aircraft purchase and deepen commercial ties with the U.S., signaling a strategic trade realignment amid global economic shifts.

February Economic Calendar

Feb 6 – RBI Interest Rate Decision: The Reserve Bank of India’s policy decision will influence emerging market currencies and capital flows, given India’s role in global growth.

Feb 6 – U.S. Employment Report (Delayed): The January U.S. jobs report, delayed from earlier in the week, will be a key read on economic momentum, labour conditions, and potential Fed policy direction.

Feb 7 – Trade Balance & Retail Sales (Dec): Key U.S. and global trade/consumption indicators will impact growth expectations and currency valuations.

Feb 7 – German Factory Orders (Dec): German industrial activity data will be watched for signs of Eurozone manufacturing health in the context of slowing growth.

Feb 8 – Foreign Reserves (Jan): Emerging markets reserve data may influence perceptions of global liquidity and currency stability.

Tech Rout Deepens as Amazon Miss Spurs Market Sell-Off

U.S. equity futures extended declines early Friday after Amazon’s earnings miss triggered a fresh wave of tech-sector weakness. The e-commerce giant’s shares fell 11% after narrowly missing EPS estimates and projecting $200 billion in 2026 capital expenditures, deepening pressure on the Nasdaq, which is on track for its worst week since April’s tariff-driven slide.

Software stocks continued to underperform, with the IGV ETF dropping over 11% this week—its steepest weekly loss since 2008—amid investor unease over AI disruption. Broader indices also retreated, with the S&P 500 and Dow shedding 1.2% each, while Bitcoin and silver slid in a broader risk-off move. Reddit bucked the trend, rising 4% on strong earnings and a $1 billion buyback.

Stellantis Shares Plunge on $26 Billion Transition Charge

Stellantis tumbled 20% in European trading after announcing a €22 billion ($26 billion) charge tied to its accelerated shift toward electric and hybrid vehicles. The automaker cited misjudging the pace of the energy transition and poor past execution as key factors behind the write-down, which led to a forecasted 2025 net loss, suspension of its 2026 dividend, and plans to raise €5 billion via hybrid bonds.

Despite reaffirming U.S. investment plans and job creation, the move underscores mounting costs and strategic recalibrations across the auto sector as legacy players adapt to changing demand. Shares remain under prolonged pressure, down over 13% year-to-date.

AI Fears Trigger Sharp Software Sell-Off Amid Sector Repricing

The software sector came under renewed pressure this week after Anthropic unveiled AI tools designed to automate key professional workflows, prompting investor concern over the long-term viability of traditional SaaS business models.

The S&P 500 Software & Services Index dropped over 4% Thursday, now down 20% year-to-date, with steep losses in names like Salesforce, Thomson Reuters, and LegalZoom. While tech leaders like Nvidia’s Jensen Huang dismissed fears as “illogical,” analysts remain split—some warning of sustained pricing and margin pressure as AI integration accelerates.

Amid the volatility, firms with deeply embedded enterprise functions, such as Oracle and ServiceNow, are seen as more resilient in the evolving AI landscape.

India Signals $80 Billion Boeing Purchase Amid New U.S. Trade Pact

India is preparing to place aircraft orders worth up to $80 billion with Boeing as part of a broader U.S.-India trade agreement expected to be finalized in the coming days, according to Commerce Minister Piyush Goyal.

The deal, which includes tariff cuts and expanded access to U.S. goods, marks a strategic pivot by New Delhi to deepen commercial ties with Washington amid shifting global alliances. While the Indian government has not confirmed all details announced by President Trump—such as zero tariffs and a $500 billion import commitment—analysts view the aircraft purchase as a tangible step in aligning trade priorities and boosting defense and aviation cooperation.

Conclusion

This week’s market developments reflect a growing divergence in investor confidence as macro shifts and sector-specific disruptions reshape risk dynamics. Tech earnings, led by Amazon, have intensified pressure on high-growth equities, while Stellantis’ strategic reset underscores the cost of misjudging transition timelines.

Meanwhile, the software sector faces renewed scrutiny as AI innovation challenges legacy business models. On the global front, India’s prospective $80 billion Boeing deal signals deepening U.S. trade ties. As markets navigate rising volatility and structural change, investors are recalibrating expectations, favoring resilient balance sheets, credible growth strategies, and geopolitical alignment as key drivers of long-term performance.

Investment Insights

• Tech Selectivity Is Key: The sharp sell-off in Amazon and broader tech highlights the need for disciplined exposure, favoring firms with earnings visibility and balanced capex strategies.
• EV Transition Risk Is Rising: Stellantis’ write-down signals that legacy automakers face execution and cost risks in energy transition timelines—investors should prioritize those with adaptable, phased strategies.
• AI Impact Will Be Uneven: While AI adoption disrupts traditional SaaS models, firms with embedded enterprise roles and deep data integration may retain durable value.
• Geopolitical Trade Shifts Matter: India’s alignment with U.S. supply chains offers opportunities in aerospace, defense, and export-linked sectors amid evolving global trade dynamics.