Dow climbed 317 (session high), advancers over decliners 2-1 & NAZ finished up 38. The MLP index added 2+ to the 327s & the REIT index rose 6+ to the 406s. Junk bond funds remained about even & Treasuries were purchased, bringing lower yields. Oil retreated 1+ to 71 & gold gained 12 to 2888 (more on both below).

Dow Jones Industrials

Advanced Micro Devices (AMD) shares slumped after the chipmaker under-delivered on estimates for its important data center business. AMD reported better-than-expected results on the top & bottom lines, but it also reported data center sales of $3.86B. That reflected 69% growth from a year ago but fell short of the $4.14B in sales expected. The key unit, responsible for selling advanced chips for data centers, has benefited in recent years from growing demand for its graphics processing units, as megacap technology companies race to develop advanced artificial intelligence tools. Data center revenue grew 94% for the full year to $12.6B, with $5B of those sales stemming from AMD's AI-focused Instinct GPUs. The company is the 2nd-largest producer for gaming after Nvidia (NVDA), which has triumphed as the market leader in AI chips & ballooned in value to a nearly $3T market value. “We believe this places AMD on a steep long-term growth trajectory, led by the rapid scaling of our data center AI franchise from more than $5 billion of revenue in 2024 to tens of billions of dollars of annual revenue over the coming years,” AMD CEO Lisa Su said. AMD stock dropped 7.49 (6%).

AMD shares drop 7% on disappointing data center revenue

Homebuyers are seeing very little reason to get a jump on the all-important spring housing market, even with more listings coming up for sale. Mortgage rates haven’t moved much in the last few weeks while home prices continue to rise. Mortgage applications to purchase a home last week dropped 4%, compared with the previous week, according to the Mortgage Bankers Association's (MBA) seasonally adjusted index. Demand was flat compared with the same week a year ago. “The average loan size for a purchase loan has increased since the start of the year and continued that trend last week with weaker government purchase activity, which reached $447,300, the highest level since October 2024,” said Joel Kan, VP & deputy chief economist at the MBA. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766K or less) decreased to 6.97% from 7.02%, with points increasing to 0.64 from 0.63 (including the origination fee) for loans with a 20% down payment. That rate was 17 basis points lower than the same week a year ago. “Mortgage rates moved lower last week, consistent with lower Treasury yields following the FOMC meeting and a volatile week for stock market. The 30-year fixed rate declined to its lowest level in six weeks,” Kan added. Applications to refinance a home loan responded to that small drop, rising 12% from the previous week & 17% from the same week a year ago. The percentage increases are large, but much of that is due to volumes being so low. Most borrowers today have rates well below what is being offered today. Mortgage applications to buy a home are now 39% lower than they were in Feb 2019, pre-pandemic. Home sales are running at a near-30-year low & house prices nationally continue to hit record highs. More sellers are offering price cuts, 15.6% in Jan compared with 14.7% in Jan of last year, according to Realtor.com. But most sellers are still seeing enough competition to hold fast to their list prices. Meanwhile, the supply of homes for sale rose 25%, compared with a year ago. Much of the supply gain is because homes are sitting on the market longer. The average time to sell a home in Jan was 54 days, the longest since Mar 2020, according to Redfin. The supply of homes for sale is still 25% below where it was in Jan 2019.

Homebuyer mortgage demand drops further, a troubling sign for the spring market

Disney (DIS), a Dow stock, posted fiscal first-qtr earnings that beat on the top & bottom lines, but revealed the beginnings of expected streaming subscriber losses at Disney+. The streaming business reported another qtr of profitability despite a 1% decline in subscribers for Disney+, the company's flagship service. While domestic subscriptions for the platform increased around 1%, intl numbers declined 2%. DIS warned during its fiscal 4th-qtr report in Nov that it expected a “modest decline” in subscriptions during the Dec period. DIS told investors that it expects another “modest decline” in subscribers during the 2nd qtr. Total paid Disney+ subscriptions stand at 124.6M, compared with 125.3M at the end of the company's fiscal 4th qtr. Total Hulu subscriptions rose 3% during the period to 53.6M. The slowdown in streaming subscriber growth follows an increase in prices for its services last year. Disney+'s average monthly revenue per paid subscriber increased roughly 4% to $7.99 due to those price hikes. EPS rose to $1.40 from $1.04 during the same quarter last year. Adjusting for 1-time items including restructuring charges & impairments related to intangible Hulu assets, DIS reported adjusted earnings of $1.76 per share. Revenue increased 4.8% to $24.7B compared with $23.6B in the year-earlier period. The company saw revenue gains across the board for its entertainment, sports & experience segments. The stock fell 2.75.

Disney tops quarterly profit estimates, but starts to lose Disney+ streaming subscribers

Gold prices continued their record run, as investors sought the safe-haven asset amid escalating concerns about a US-China trade war & the potential impact on economic growth. Spot gold was up 0.8% at $2865 per ounce after hitting a record high of $2882 earlier in the session. US gold futures settled 0.6% higher at $2893 per ounce. Gold continues to be largely influenced by trade uncertainties with China & the retaliation has the market on edge, so safe-haven flows remain the dominant factor. Earlier this week, China retaliated by imposing tariffs on US goods in response to new US tariffs, escalating the trade war, while Pres Trump expresses no urgency in speaking with Chinese Pres Xi Jinping to alleviate tensions. Meanwhile, the US Postal Service said it will resume accepting all inbound mail & packages from China & Hong Kong, a day after temporarily suspending such service. 3 Federal Reserve officials warned Trump's trade tariffs could drive inflation, with 1 suggesting uncertainty over price outlooks warrants slower interest rate cuts. The ADP National Employment report showed the US economy added 183K jobs in the private sector last month, compared with the estimate for a rise of 150K.

Gold adds to record rally as trade war anxiety lifts demand

Oil prices fell more than 2% as a large build in US crude & gasoline stockpiles signaled weaker demand, while worries about a new China-U.S. trade war fueled fears of softer economic growth. Brent crude futures settled down $1.59 (2.1%) to $74.61 a barrel & US West Texas Intermediate crude was down $1.67 (2.3%) to $71.03. US crude oil inventories rose sharply last week, the Energy Information Administration said, as refiners facing soft gasoline demand did maintenance work. Refiners just don't have a call for crude right now & they're racing into maintenance, given the slack demand for gasoline. Concern over a new trade war between the US & China, the world's largest energy importer, also pressured prices. Yesterday, China announced tariffs on imports of US oil, liquefied natural gas & coal in retaliation for US levies on Chinese exports, pushing WTI down 3% at its session low, the lowest this year. Iran's Pres Masoud Pezeshkian urged OPEC members to unite against possible US sanctions, after Trump said he would restore the "maximum pressure" campaign on Iran that he enacted in his first term.

Oil down as US crude inventories swell, traders worry about China-US trade

Stocks were mixed after earnings from big tech companies disappointed. But buyers returned to bid prices higher during the trading session. Meanwhile, the 10-year Treasury yield fell 9 basis points to hit 4.42%, its lowest level since Dec 2024. Pres Trump's tariff plans have markets already jumpy, & his unexpected suggestion late yesterday that the US could take over the Gaza strip & develop it as a "Riviera of the Middle East" left investors even more bemused about which direction policy will take next.