Mega-Cap Earnings Meet a Chip Meltdown

The Big Picture

Markets are navigating two forces at once today. Big Tech earnings season hits its peak — MSFT, AAPL, and AMZN all report within 48 hours. At the same time, a chip sell-off is rattling the Nasdaq. SK Hynix missed earnings expectations. That spooked the entire AI supply chain and pushed the Nasdaq 100 briefly into correction territory. NVDA sits at the centre of the storm. MU options saw the heaviest bearish flow among large caps as longs scramble for downside protection.

Short Sellers Target Consumer Names

Bears are pressing hard into beaten-down consumer stocks. Chewy SI % FF jumped 14 points in a week to 80.4%. Hertz sits at 84.1% — with zero shares left to borrow. New short positions there are practically impossible to open. Wolfspeed remains extreme at 118.8% SI % FF, meaning short interest exceeds the entire free float.

Analysts Respond to Earnings

Wall Street lifted targets broadly after a strong earnings wave. IQVIA Holdings targets rose to $269. All 18 covering analysts rate it a Buy. Flex Ltd. targets moved to $166.80 — also a unanimous Buy sweep. ADP and General Dynamics both saw modest target increases.

European Angle

Hedge funds are facing collateral calls as AI-linked names slide. The Bank of England is now probing prime broker exposure to the AI sector. European defense names bucked the trend, rallying after Ukraine ratified a $105 billion EU loan deal. Thyssenkrupp Nucera saw its short book halved but cost to borrow remains punishing — a sign shorts aren't fully capitulating yet.