Morning Forecast: Friday 29 May
Dell and Snowflake each rocketed nearly 40% on AI demand, pushing the S&P 500 and Nasdaq to record highs.
This content is for informational and educational purposes only and does not constitute financial advice. Always do your own research. Not financial advice (NFA).
👀 Today’s Stories at a Glance
📈 Snowflake’s 37% AI Surge: A blowout quarter and record Amazon cloud deal drove indices to fresh highs.
🖥️ Dell Jumps 38% Overnight: Record AI server demand lifted revenue 88 percent and crushed every estimate.
💸 Inflation Hits Three-Year High: The Federal Reserve’s favored gauge rose to 3.8 percent, pushing rate cuts further away.
🍼 Trump Accounts App Launches: Every eligible child gets a one-time $1,000 government deposit routed into index funds.
✈️ Southwest’s Fare Hikes Hold: Seven price increases since February met no demand drop, lifting every major airline.
🏠 Florida Targets Property Taxes: DeSantis pushes to scrap most homeowner property tax, risking local muni credit ratings.
📋 Jobless Claims Tick Higher: First-time filings rose to 215,000, a one-month high but still historically low.
🛡️ Meta Funds Oversight Board: A surprise $13 million keeps the content watchdog running through 2028.
🛢️ Oil Slips On Ceasefire: A reported 60-day Iran truce extension pulled Brent crude back near $92.
🚀 Virgin Galactic Eyes $5 Breakout: SPCE reclaimed its momentum band and moving average, now pressing key $5 resistance overhead.
🧠 One Big Thing
Markets closed at records on AI earnings while inflation quietly hit a three-year high, and that gap is the whole story. Snowflake and Dell gave investors a reason to buy, but the Personal Consumption Expenditures print at 3.8 percent and a savings rate at 2.6 percent point to a consumer running thin. For now AI strength is drowning out the macro warning. The risk is timing, because AI wins arrive on scheduled earnings dates while the pressure on households builds every day. Watch whether the next soft data point lands without an AI headline to cover it.
⚖️ Fear & Greed
📉 The Number That Matters
2.6%
The US savings rate fell to 2.6 percent, the lowest since June 2022, and a 2.6 percent cushion suggests consumers are funding spending by drawing down savings, not by earning more.
⚔️ Winners vs Losers
Winners
REPL 0.00%↑: Replimune Group surged in pre-market trading around the timing of its fiscal Q4 earnings report, though no specific confirmed driver for the size of the move was identified in available reporting.
DELL 0.00%↑: Dell Technologies rocketed higher after blowout fiscal Q1 results, posting EPS of $4.86 against a roughly $2.93 estimate and dramatically lifting full-year revenue guidance to $165 billion to $169 billion from a prior $138 billion to $142 billion on surging AI server demand.
QTEX 0.00%↑: QTREX Quantum, the former Inspira Technologies that rebranded in May to pivot from medical devices into additively manufactured electronics, extended a multi-day momentum run after disclosing advanced collaboration talks with a top-five global quantum computing company to test its interconnect components in cryogenic systems.
NTAP 0.00%↑: NetApp climbed after reporting record fiscal Q4 and full-year results with non-GAAP EPS of $2.43, revenue up 12 percent, and strong FY27 guidance, helped by a multiyear Google Cloud agreement and accelerating enterprise AI demand.
BRUN 0.00%↑: Boost Run, an NVIDIA cloud partner providing AI infrastructure and high performance compute that recently went public via SPAC merger, rallied on momentum from its $1.44 billion hardware purchase agreement with Dell and fresh bullish analyst initiations.
NOW 0.00%↑: ServiceNow advanced on a read-through from Snowflake’s strong quarter, given the two are formal data-integration partners, alongside a flurry of new agentic-AI partnership announcements with Experian, Accenture, FedEx Dataworks, and Boomi.
Losers
GAP 0.00%↑: Gap fell after weak Old Navy comparable sales of just 1 percent versus the 3 percent expected led management to cut its full-year sales growth outlook to 1 to 2 percent, overshadowing an earnings beat and a raised profit forecast.
S 0.00%↑: SentinelOne dropped after reporting revenue that came in roughly in line at $277 million but issuing softer-than-expected next-quarter guidance and announcing an 8 percent workforce reduction with a $25 million restructuring charge.
ASTS 0.00%↑: AST SpaceMobile slid after a Blue Origin New Glenn rocket exploded during testing, reviving concerns about the company’s aggressive satellite rollout given its multi-launch agreement with Blue Origin for future Block 2 BlueBird deployments.
📊 Market Snapshot
Cryptocurrencies:
Bitcoin (BTC): $73,413 (▼ -0.14%)
Ethereum (ETH): $2,005 (▼ -0.10%)
XRP: $1.31 (▼ -0.12%)
Equity Indices (Futures):
S&P 500: $7,593 (▲ 0.15%)
NASDAQ 100: $30,353 (▲ 0.15%)
FTSE 100: £10,442 (▲ 0.36%)
Commodities & Bonds:
10-Year US Treasury Yield: 4.45% (▼ -0.18%)
Oil (WTI): $88 (▼ -0.94%)
Gold: $4,527 (▲ 0.69%)
Silver: $75.49 (▼ -0.17%)
Data as of: UK (BST) 12:37 BST / US (EDT): 07:37 EDT / Asia (Tokyo): 20:37
✅ 5 Things to Know
📈 Snowflake Jumps 37% and Reignites the AI Trade
Snowflake, the cloud data and software company, surged as much as 37% yesterday, one of its biggest single-day gains ever, after fiscal first-quarter results blew past forecasts and it unveiled a $6 billion, five-year commitment to Amazon Web Services (Amazon’s cloud arm), its largest ever. Revenue rose 33% to $1.39 billion, beating the roughly $1.32 billion expected, and adjusted profit came in at $0.39 a share versus $0.32 forecast. The company lifted full-year product-revenue guidance to $5.84 billion and raised its profit-margin outlook. The stock had been down about 20% this year before the report, and yesterday’s rally helped push the S&P 500 and Nasdaq to record closes. (Yahoo Finance)
For retail investors, the read-through is that companies are moving from testing AI to paying for it in real production, and that spending is now landing on software firms, not just chipmakers. Snowflake’s pop came a day after Micron crossed $1 trillion and in the same session software peers like Oracle and Palantir rose 3% to 4%. The next catalyst arrives fast: Snowflake’s user conference begins in early June, where management is expected to detail its “agentic” tools, software that carries out multi-step tasks rather than just answering questions. The $6 billion commitment also locks in years of recurring revenue for Amazon. (The Motley Fool)
Sensei’s Insight: Snowflake was down about 20% this year before this report, and a single night erased it. The signal worth watching is that AI money is now reaching software and data companies, not just chip names, and the spending looks like real production rather than pilot projects.
🖥️ Dell Soars 38% After Hours on AI Server Demand
Dell Technologies jumped about 38% in late trading yesterday after a fiscal first-quarter report that beat every estimate, the latest sign demand for artificial-intelligence hardware is still accelerating. Revenue rose 88% to a record $43.8 billion, far above the roughly $35.5 billion Wall Street expected, and adjusted profit was $4.86 a share versus $2.94 forecast. Sales of AI-optimized servers, the machines that run AI workloads, rose 757% to $16.1 billion, and Dell booked $24.4 billion in new AI orders during the quarter. It raised full-year revenue guidance to a range of $165 billion to $169 billion and lifted its AI-server sales target for the year to about $60 billion. (Investing.com)
For retail investors, Dell makes the same point as Snowflake from the hardware side: the AI buildout is scaling up, not cooling off. Dell partners with Nvidia to assemble full AI systems, so its order book is a live read on how fast data-center spending is moving across the industry. The stock is already up more than 150% this year, and the after-hours move points to a sharply higher open today. The thing to watch from here is margins. AI servers earn less per dollar of sales than Dell’s older gear, so whether profit climbs as fast as revenue is what decides if the rally holds. (Benzinga)
Sensei’s Insight: Dell’s AI-server backlog sits near $51 billion, up from $43 billion three months ago. The orders aren’t slowing. The real test over the next few quarters is whether Dell can turn that lower-margin server revenue into actual profit, which is where the stock gets judged.
💸 Inflation Hits Three-Year High as Savings Run Thin
The Federal Reserve’s preferred inflation gauge climbed to its highest level in nearly three years yesterday, making the case for rate cuts harder to argue. The Personal Consumption Expenditures (PCE) price index, the measure the Fed watches most closely, rose 0.4% in April and 3.8% from a year earlier, up from 3.5% in March and driven mainly by higher energy prices tied to the Iran war. Consumers kept spending, up 0.5% on the month, but adjusted for inflation that gain was just 0.1%, meaning almost all of it was higher prices rather than more goods. To pay for it, households cut their savings rate to 2.6%, the lowest since June 2022. (CNN)
For retail investors, this is the strain sitting under a calm-looking market: incomes barely moved while prices rose, so people are leaning on savings to keep up, and that cushion is getting thinner. With inflation now closer to 4% than the Fed’s 2% target, rate cuts look further off, which tends to weigh on bonds and on richly valued stocks. Stocks still closed at records yesterday, but on AI earnings, not on the inflation data. The next signals to watch are the May jobs report next week and comments from Fed officials, one of whom already said inflation is “moving in the wrong direction.” (Bloomberg)
Sensei’s Insight: The savings rate has dropped from 4.3% in January to 2.6% now. People are spending by drawing down savings, not by earning more. That works until it doesn’t, and it’s the clearest sign the consumer is closer to empty than the headline spending number suggests.
🍼 Trump Accounts App Launches With $1,000 Per Child
The US Treasury rolled out the Trump Accounts app nationwide yesterday on the Apple and Google app stores, opening a new tax-deferred investment account for children. Every eligible US-citizen child born between 2025 and 2028 receives a one-time $1,000 government deposit, and family, friends and employers can add up to a combined $5,000 a year. The money must go into a low-cost fund tracking a broad US stock index and grows tax-deferred until the child turns 18. Contributions and the $1,000 seed begin July 4, and nearly 6 million children are already signed up. The app was built and run by Robinhood and Bank of New York Mellon (BNY). (CNBC)
For retail investors, this lands two ways. As a planning tool it’s a new way to start a child investing early, though advisers note that 529 plans, the state-run college-savings accounts, often work better for tuition, and that only part of the money escapes tax at withdrawal. As a market force, automatic contributions into index funds could feed a steady, multi-year flow into US stocks. The clearest single-stock tie is Robinhood, which built the app and rose about 11% yesterday, though most of that came with the broad market rally rather than the launch alone. The date that matters is July 4, when money actually starts moving. (U.S. News & World Report)
Sensei’s Insight: The real test isn’t the app, it’s July 4, when the first $1,000 deposits and family contributions actually start flowing. If even a fraction of nearly 6 million accounts get funded regularly, that’s a slow, steady new buyer of US index funds for the next two decades.
✈️ Southwest’s Fare Hikes Stick, and First Class Is Next
Southwest Airlines said yesterday it has seen no drop in demand after joining seven industry-wide fare increases since February, a sign carriers still have room to charge more. Speaking at a Bernstein investor conference, Chief Executive Bob Jordan called it the most fare increases in his 38-year career and said there has been “no drop-off in demand at all.” He also floated a bigger shake-up: adding a “true first class” cabin and, over time, some long-haul international routes, a further break from Southwest’s no-frills roots. Business-traveler revenue rose 25% in March and kept climbing through April and May. Southwest shares rose about 6% on the day. (The Daily Record)
For retail investors, Southwest is a read on whether travel spending is holding up, and the answer yesterday was yes, which lifted the whole sector: Delta, United, American and Alaska all rose more than 7%, helped along by easing oil prices. The first-class and long-haul talk shows how far Southwest has moved under pressure from activist investor Elliott Management, dropping open seating and free checked bags for paid tiers. The company expects more than $1 billion in extra operating profit this year from premium seating. The open question is whether Southwest’s loyal flyers accept a pricier, less-distinct airline. (Seeking Alpha)
Sensei’s Insight: Seven fare hikes since February and demand didn’t blink, which is real pricing power, and it showed up across every major airline yesterday. The question now is whether Southwest’s loyal flyers stay put as it adds first class and fees, or drift to the rivals it once undercut.
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🏠 Florida’s Tax Cut Could Mean ‘Fees for Everything’
Florida Governor Ron DeSantis is pushing to eliminate property taxes for most homeowners, starting by raising the homestead exemption, the slice of a home’s value shielded from tax, from $50,000 to $250,000, with a special legislative session beginning next week to put the plan on the November ballot. For investors, the issue is that property taxes fund local services and back the municipal bonds that Florida cities, counties and school districts issue. Replacing the roughly $55 billion to $60 billion they raise each year would likely fall on higher sales taxes and fees, and muni analysts warn it could pressure local credit ratings. DeSantis says the first step frees about 60% of homesteaders from the tax, though a UBS note puts it nearer 47%. (Bloomberg)
📋 Jobless Claims Hit One-Month High, Still Low
First-time claims for unemployment benefits rose by 5,000 last week to 215,000, the highest in a month and slightly above the 211,000 economists expected, the Labor Department said yesterday. The level is still historically low, and the picture remains one of low hiring and low firing: employers aren’t cutting staff, but they aren’t adding many workers either. Monthly job creation has slowed to about 76,000 this year, down from 122,000 in 2024, with AI-related tech layoffs a notable exception. For investors, a softening job market strengthens the case for eventual Fed rate cuts, but paired with yesterday’s hot inflation print, it keeps the central bank stuck in place. (U.S. News & World Report)
🛡️ Meta Surprises With $13M to Keep Oversight Board
Meta has committed an additional $13 million to fund its independent Oversight Board through 2028, the board said yesterday, a surprise after reports earlier this year that Meta might stop paying for the watchdog. The board, set up in 2020, makes binding decisions on content-moderation disputes across Facebook, Instagram and Threads. The sum is tiny for a company Meta’s size, so it won’t move the stock, but it matters for how Meta governs content as AI-generated posts multiply and after it replaced US fact-checking with crowd-sourced Community Notes last year. The board has warned those notes aren’t a full substitute for fact-checking. (Reuters)
🛢️ Oil Slips on Reported Iran Ceasefire Extension
Oil prices pulled back yesterday after US and Iranian negotiators reportedly reached a 60-day agreement to extend their fragile ceasefire and begin talks on Iran’s nuclear program, according to US officials. The deal still needs President Trump’s sign-off, and it came only hours after the two sides traded fresh military strikes, so it is far from settled. A separate Iranian claim that any deal would reopen the Strait of Hormuz, the channel that carries about a fifth of the world’s oil, was dismissed by the White House as a fabrication. Brent crude sat near $92 a barrel. For investors this remains the swing factor behind energy prices and the inflation now showing up in the data. (CNBC)
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📈 Chart of the Day: Virgin Galactic (SPCE)
Virgin Galactic is putting in a nice pump here. We’re back above the momentum band after it flipped green at $2.73, and price has pushed back above the moving average too, which is exactly what we want to see. From there SPCE is now driving up toward $5, the psychological level and the big line of resistance sitting overhead.
$5 is the level that matters. If we can get back above $5 and hold it, there’s room to accelerate fairly fast toward $8 and then up near $10, which is where I’ve got a limit order sitting around $9.50. Below $5 I’ll be more careful, but for now this is looking good for SPCE, just up against that $5 resistance. Anyone holding from the $2.30 area may be eyeing some profit here too.
Key levels:
$5.00: psychological level and key resistance overhead
$2.73: where the momentum band flipped green, current support reference
$8.00: first upside target on a clean break above $5
~$10.00: secondary target (chart resistance near 10.16)
$9.50: my limit order level
$2.30: position/entry reference for holders watching for profit
This content is for informational and educational purposes only and does not constitute financial advice. Always do your own research. Not financial advice (NFA).