Stocks Drop Despite Palantir’s Great Report, What to Watch Now[Stocks](https://moneymorning.com/category/article/stocks/) # Stocks Drop Despite Palantir’s Great Report, What to Watch Now  by Chris Johnson  November 4, 2025  Share it: ## Today’s Top & Bottom Lines – November 3, 2025 | | | | --- | --- | | #### **Pre-Market Price Check** | | **S&P 500 Futures: +0.39%** | **10-Year Yield: 4.112 (+0.011)** | | **Nasdaq 100 Futures: +0.87%** | **WTI Crude: $60.95 (-0.02%)** | | **Dow Jones Futures: UNCH%** | **Gold Futures: $4,029 (+0.81%)** | | **VIX: 16.92 (+3.05%)** | **Bitcoin (BTC): $107,834 (-1.96%)** | ## What’s Driving Stocks This Morning \*\*CJ’s Note… Make sure you read today’s “Bottom Line” below for critical levels to watch on the VIX, Nasdaq 100 and S&P 500\*\* Stocks are under pressure Tuesday morning as concerns about overvaluation finally catch up to the market’s AI-led rally. Nasdaq futures were down over 1.5% early in the morning following Palantir’s earnings release, which - despite crushing expectations and issuing bullish forward guidance - triggered a selloff tied to the stock’s extreme valuation. PLTR trades at more than 240x forward earnings, and the post-earnings reaction underscores a key risk in the AI space: even blowout results aren’t enough when sentiment is stretched. Expect this pullback to be short-term in nature. Palantir reported $0.21 in Q3 EPS vs. estimates of $0.17, with revenue growing 63% year-over-year. U.S. commercial revenue surged 121%, and Q4 revenue guidance came in more than 10% above consensus. Yet shares are down over 7% pre-market, dragging the entire AI complex lower, including all “Magnificent Seven” names. Uber also missed the mark, beating on top-line metrics but guiding EBITDA in-line and disappointing on margins. The report triggered a 4.6% pre-market drop and added to the broader sentiment shift away from richly valued tech. Elsewhere, Spotify rallied on strong earnings, and Senate leaders voiced optimism on resolving the government shutdown this week, a potential macro positive. However, for now, the focus remains on sky-high valuations and whether this pullback turns into something deeper. ### **Key Drivers on Tuesday:** - Palantir earnings beat but triggers selloff on valuation fears - Uber disappoints despite revenue/gross bookings growth - Spotify rallies on strong earnings - Mega-cap tech trades lower across the board on valuation worries - Wall Street executives warn of equity market overvaluation (Bloomberg) - Quiet macro calendar, but volatility picks up as VIX jumps 9% ## Stocks on the Move (Pre-Market) **Palantir (PLTR)** $190.76 –7.9%: Crushed earnings, raised FY25 guidance, but trades at 245x forward earnings — valuation reset in play. **Uber (UBER)** $95.12 –4.6%: Beat revenue estimates, but margin compression and EBITDA guidance in-line failed to impress. **Spotify (SPOT)** $680.41 +5.6%: Delivered a massive $1.32 EPS beat; revenue in-line and outlook reaffirmed. ## Upgrades & Downgrades #### Upgrades - **Apple Inc. (AAPL)** — Upgraded to **Buy** by DZ Bank, with a price target raised to $300, on signs of improved iPhone demand and services growth. Analysts cite the upcoming holiday season as a key upside driver. - **Napco Security Technologies, Inc. (NSSC)** — Upgraded to **Buy** by TD Cowen, price target lifted to $50, after three straight quarters of earnings beats and strong equipment‑sales momentum. - **Qorvo, Inc. (QRVO)** — Upgraded from Underweight to **Neutral** at JPMorgan, target moved to $105 from $92, driven by strength in iPhone content, defense/aerospace exposure, and reshaping via the Skyworks deal. - **Terex Corporation (TEX)** — Multiple firms including Morgan Stanley and Raymond James are lifting ratings (Morgan Stanley to Equal‑Weight) and targets (to ~$47) as Terex pivots away from cyclicality via its REV Group merger, targeting more resilient infrastructure & utility end markets. #### Downgrades - **AbbVie Inc. (ABBV)** — Downgraded to Hold by DZ Bank, target $237; concerns center on slowing growth in core pharma franchises and increasing biopharma competition. - **DraftKings Inc. (DKNG)** — Downgraded to Neutral at BofA, target $35; the downgrade reflects tougher regulatory headwinds and margin pressure in the U.S. sports‑betting landscape. - **Comcast Corporation (CMCSA)** — Downgraded to Perform from Outperform by Oppenheimer; the media/broadband operator faces flattening subscriber growth and the need for higher capital investment. - **Steel Dynamics, Inc. (STLD)** — Downgraded to Neutral at UBS, target $165; slowing steel demand, global overcapacity and raw‑material cost risks trigger caution across the materials cycle. ## Today’s Bottom Line – Volatility is back. The **VIX is up 9%** this morning and is once again threatening to break out of the “buy zone” it has been stuck in for weeks. That alone signals we’re entering a more turbulent stretch — at minimum, expect elevated swings in the coming days as traders digest the final batch of mega-cap tech earnings. Importantly, aside from **NVIDIA’s report in 15 days**, the market is essentially done with the AI trade’s key catalysts. That gap gives analysts and strategists room to talk, and we’re already hearing it already. Bloomberg highlighted this morning that **top Wall Street executives are concerned about high equity valuations**, with some calling for a potential 10% pullback. At the current pace, that could unfold in just two weeks of selling. That also cuts both ways. The **buy-the-dip reflex** has been strong all year, especially when paired with seasonality tailwinds. November and December are historically strong for stocks, and the fear of missing out on a year-end rally is real. That backdrop should limit the depth of any correction, at least at first. Still, seasonality is not a safety net. Stocks climb a Wall of Worry, but **overconfidence kills returns**. When sentiment shifts too quickly - as it has over the last two weeks - the technicals become even more important. Traders should focus less on emotions and more on key price levels. Here’s what to watch: - **VIX 20** – A confirmed breakout signals a broader shift in volatility regime. - **Nasdaq 100 ETF (QQQ) at $600** – A round-number psychological support level that could act as a buying line. - **S&P 500 at 6,000** – Another major psychological support; if it breaks, look for increased downside acceleration. Use the pullback to refine your watchlist — the best opportunities often show up in the first wave of weakness, not the last.  **Beat the market, without relying on brokers or biased institutions.** Email(Required) Facebook This field is for validation purposes and should be left unchanged. 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