Asia-Pacific Markets Decline Following Lackluster Wall Street Performance
Market Performance: Asia-Pacific markets opened lower, with Australia's ASX/S&P 200 down 0.17%, Japan's Nikkei 225 losing 1.36%, and South Korea's Kosdaq Index retreating 0.25%.
Japanese Bond Yields: Yields on Japan's 10-year government bond rose to 1.94%, the highest level since July 2007, indicating increased investor concern.
Tech Stocks Focus: Investors are closely monitoring tech stocks amid bubble concerns, with SoftBank shares rising nearly 4% before settling at a 1.02% increase, despite founder Masayoshi Son expressing regret over selling Nvidia shares.
U.S. Market Update: In the U.S., major indices had mixed results, with the S&P 500 and Nasdaq Composite slightly up ahead of the Federal Reserve's interest rate decision, while the Dow Jones Industrial Average fell by 0.07%.
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- Significant User Growth: OpenAI CEO Sam Altman revealed in an internal message that ChatGPT is experiencing over 10% monthly growth, with approximately 800 million weekly active users, demonstrating strong appeal despite fierce competition in the market.
- Product Update Plans: Altman also mentioned that OpenAI plans to release an updated chat model this week, and its AI coding tool Codex has grown by about 50% in the past week, which will further enhance its product competitiveness.
- Ad Testing Launch: OpenAI is set to begin testing ads in ChatGPT today, facing criticism from competitor Anthropic; Altman emphasized the goal of making AI accessible to a broad user base that cannot afford subscription fees.
- Market Valuation Surge: OpenAI's valuation is expected to soar above $800 billion, while Anthropic's latest funding round could elevate its valuation to $350 billion, indicating strong growth potential for both companies in the AI sector.
- Executive Change: Workday CEO Carl Eschenbach has stepped down immediately, with co-founder Aneel Bhusri taking over; Bhusri's extensive leadership history from 2009 to 2024 indicates a significant shift in the company's direction.
- Market Pressure: Software stocks are under pressure as investors worry about AI's disruptive potential, with Workday's shares dropping 17% last year and over 20% year-to-date, reflecting diminished market confidence in the company's future.
- Job Cuts and Investment: To bolster its investment in technology, Workday cut approximately 1,750 jobs last year; despite Eschenbach's statement highlighting achievements in operational discipline and AI groundwork, the market's reaction remains negative.
- Industry Transformation: Bhusri stated that AI represents a transformation larger than SaaS, which will define the next generation of market leaders, indicating that the company will face new strategic challenges and opportunities ahead.
- Leadership Change: Workday announced the immediate resignation of CEO Carl Eschenbach, with co-founder Aneel Bhusri stepping back into the role, having previously served as CEO from 2009 to 2020, which may significantly influence the company's strategic direction.
- Market Pressure Intensifies: Workday's stock has dropped 17% over the past year and more than 20% year-to-date, reflecting investor concerns about the potential impact of artificial intelligence on the software sector, indicating a lack of confidence in the company's future performance.
- Job Cuts and Investment: Last year, Workday cut approximately 1,750 jobs to bolster its investment in technology, a move that may negatively affect employee morale in the short term but could enhance the company's competitiveness in AI in the long run.
- Industry Outlook: Bhusri stated that AI represents a greater transformation than SaaS, indicating a strategic focus on leveraging AI technology to shape future market leaders, which could significantly impact Workday's market positioning and competitive strategy.
- Sustained Earnings Growth: Deutsche Bank strategists highlighted that tech stocks maintained an earnings growth rate near 30% in Q4, which continues to bolster investor confidence despite a three-day market downturn.
- Software Stocks Struggle: The iShares Expanded Tech-Software Sector ETF (IGV) tumbled nearly 9% over eight consecutive days last week, reflecting investor concerns about potential disruptions to business models from artificial intelligence, leading to increased market volatility.
- Future Earnings Expectations: While analysts anticipate a slowdown in tech profit growth to 23%, forward estimates indicate an uptick in earnings expectations for megacap tech firms, suggesting sustained market confidence in future profitability.
- Market Digestion Phase: CFRA's chief investment strategist noted that the recent volatility in the information technology sector is a necessary digestion of prior gains, with projections for record earnings growth in 2026 and 2027, encouraging investors to remain patient.
- Microsoft Downgrade: Melius Research downgraded Microsoft from buy to hold, citing that CEO Satya Nadella has lost the AI narrative and that the stock appears overpriced based on new free cash flow estimates, which may undermine investor confidence.
- Eli Lilly Acquires Orna: Eli Lilly announced the acquisition of biotech firm Orna Therapeutics for up to $2.4 billion, leading to a premarket surge in Eli Lilly and rival Novo Nordisk shares, indicating a positive market response towards biotech investments.
- Kroger's New CEO: Kroger's stock advanced nearly 7% in premarket trading after reports indicated that former Walmart executive Greg Foran will be appointed as the new CEO, having previously led Walmart's U.S. division for six years, suggesting a strategic shift for Kroger.
- Robinhood Upgrade: Wolfe Research upgraded Robinhood from hold to buy, despite the stock's recent decline amid a major cryptocurrency sell-off, as analysts believe its future potential remains strong, which could attract renewed investor interest.
- Stock Rebound: Palantir Technologies Inc. shares rose 1.25% to $137.60 in premarket trading on Monday, extending Friday's 4.53% gain, indicating a positive market response to volatility in the software sector.
- Technical Analysis: Currently, Palantir's stock is approximately 14.7% below its 20-day simple moving average and 21.9% below its 100-day SMA, indicating a bearish short-term trend, although shares have increased by 16.5% over the past 12 months, reflecting relatively strong long-term performance.
- Earnings Expectations: Palantir is set to release its next financial update on May 4, 2026, with an EPS estimate of 26 cents (up 100% YoY) and a revenue estimate of $1.54 billion (up 74% YoY), showcasing robust growth potential.
- Analyst Ratings: The stock carries a Hold rating with an average price target of $161.33, with recent analyst actions including DA Davidson lowering its target to $180.00 and Citigroup raising it to $260.00, reflecting differing market perspectives on its future performance.











