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Hey everyone! The WOLF Financial team here!
We drop into your inbox a few times a week, breaking down the biggest stories in finance and the moves that matter most.
Let’s get into it
THE RUNDOWN
EARNINGS › AppLovin delivered a triple beat after the bell. EPS came in at $3.24 vs $2.93 expected, revenue hit $1.66B vs $1.60B, and Adj EBITDA landed at $1.40B vs $1.32B. Q1 revenue guidance of $1.75B to $1.78B sits well above consensus. The ad-tech machine keeps printing. ($APP)
POLICY › The US plans to carve out big tech from its next wave of chip tariffs, per the Financial Times. Semiconductor and hardware names get a reprieve, for now. This is bullish for the supply chain but watch for retaliatory moves from Beijing ahead of the Trump-Xi summit in April. ($NVDA, $TSM, $AVGO, $AMD)
EARNINGS › McDonald's posted a blowout Q4. US comparable sales surged 6.8% vs 4.87% expected, and global comps hit +5.7% vs +3.70%. Revenue came in at $7.01B vs $6.84B. The value menu strategy and international pricing power are working. Systemwide sales climbed 11%. ($MCD)
MARKETS › Palantir and Airbus locked in a 10-year contract extension worth approximately $1 billion, cementing PLTR's defense and aerospace footprint in Europe. The stock has been a 2026 standout, and institutional interest continues to build. ($PLTR)
MACRO › December retail sales printed flat at 0.0% MoM vs the +0.4% expected. That's a soft consumer signal heading into Friday's CPI report (consensus: +0.3% MoM, +2.5% YoY). The Fed is stuck between cooling demand and sticky inflation. The 10Y sits at 4.206%. Something has to give
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THE PLAY: $62 Billion Just Rotated Out of Tech
Over the past five weeks, non-tech equity funds pulled in $62 billion in inflows. That's more than the entirety of 2025's sector flows combined. Not a blip. Institutional capital repositioning at scale.
Where's it going? Consumer staples (+6% week-to-date), industrials (+4.7%), and materials (+3.5%). The playbook is straightforward: big money is hedging AI disruption risk by shifting into sectors with tangible cash flows, pricing power, and infrastructure demand.
The catalyst isn't just fear. It's math. Tech valuations remain stretched while earnings delivery is getting punished. Shopify beat EPS by 50% last week and dropped 6.6%. Meanwhile, Coca-Cola missed EPS by 30% and rallied 2.3%. The market is rewarding durability over growth right now.
This doesn't mean tech is dead. It means the easy money in mega-cap tech has been made for this cycle, and the marginal dollar is finding better risk-adjusted returns elsewhere.
What to watch: If Friday's CPI comes in hot, this rotation accelerates. Inflation-resistant sectors with real assets (energy, utilities, materials) become even more attractive relative to duration-sensitive growth names. Track fund flow data weekly. When $62 billion moves in five weeks, the trend tends to persist longer than most expect.
RALLIES RADAR
Rallies gave eight AI models $100K each and let them try to beat the S&P 500 starting in late November. Grok 4 is currently up 4.7% vs the S&P's 2.2% over the same period, while holding 50% cash. The AI is outperforming by being cautious. Sometimes the best trade is the one you don't make.
Thanks for reading! Catch you in the next one!
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