The AI Selloff You’ll Regret Missing 💰️

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THE AI SELLOFF YOU’LL REGRET MISSING 💰️ 

Friday was ugly. The S&P 500 dropped 2.7%, the Nasdaq cratered 3.6%, and the Dow limped home 1.9% lower. Trump threatened new tariffs on China, Beijing fired back, and suddenly every trader on X was acting like the sky was falling.

But according to Wedbush analyst Dan Ives, this isn’t the apocalypse. It’s poker.

Ives says the “bark is worse than the bite” when it comes to the latest Trump–Xi standoff over rare earth metals. He sees it as another headline-driven panic that’ll fade once cooler heads prevail. His advice: don’t panic sell—buy the tech winners.

He’s talking about the big players riding the AI boom—Nvidia, Microsoft, Palantir, Meta, Alphabet, and Amazon. These companies are building the backbone of the new AI economy.

Meanwhile, over in macro-land:

• The CBOE Volatility Index (VIX) spiked 32%. What does that mean? Fear is back.

• The U.S. government shutdown is on day 10, and prediction markets now see it lasting over a month.

• Bond yields cooled off, with the 10-year at 4.06% and the 2-year at 3.54%.

• Gold reclaimed $4,000 an ounce, and silver crossed $50. Safe-haven assets are suddenly the new black.

• Consumer sentiment barely budged at 55.0, beating expectations. Inflation expectations ticked down too.

But not everyone’s panicking. Alex King of Cestrian Capital called the sell-off “an absolute gift to slow, patient money.” 

If you’ve been waiting for cheaper entry points in top-tier stocks, this might be your moment.

If Ives is right, this is the same pattern we’ve seen a dozen times before. The headlines scream crisis, traders dump stocks, and then—when everyone least expects it—the rebound kicks in. The TACO trade might strike again…

TL;DR:

• Markets tanked after Trump threatened China with more tariffs.

• Wedbush’s Dan Ives says it’s all noise and calls the dip a “buying opportunity.”

• Big tech (Nvidia, Microsoft, Palantir, Meta, Alphabet, Amazon) still seen as long-term winners.

• Gold and silver soared, volatility spiked, yields dropped.

• The smart money? Calm, slow, and quietly shopping the dip.

1. Buy the Fear in Big Tech
Trump–Xi tensions sparked a tech sell-off, but Wedbush says it’s noise, not disaster. Nvidia, Microsoft, Palantir, and Amazon still lead the AI race.
📌 Action: Accumulate positions in top-tier AI and cloud names while sentiment is weak. Scale in gradually over the next 2 weeks before calm returns.

2. Rotate Into Safe Havens
Gold reclaimed $4,000 and silver topped $50 as traders fled to safety. If fear lingers, the metals trade could extend.
📌 Action: Add partial exposure to gold/silver ETFs like $GLD ( ▲ 1.01% ) or $SLV ( ▲ 1.61% ) as portfolio stabilizers while equities remain shaky.

3. Buy the Dip in Index ETFs
S&P 500 and Nasdaq just had their worst week since April, down ~2.5%. Historically, similar pullbacks during trade scares have reversed fast.
📌 Action: Dollar-cost average into broad ETFs like $VOO ( ▼ 2.69% ) or $QQQ ( ▼ 3.47% ) while volatility (VIX +32%) stays elevated, targeting a rebound once US–China noise fades.

THE BEARS ARE WAKING UP 🐻 

Short interest in S&P 500 financial stocks just crept up — nothing dramatic, but enough to raise an eyebrow.

In August, short interest dipped by a hair to 2.01%. By the end of September, it ticked back up to 2.04%. That’s around 999 million shares being bet against financial companies. For comparison, August clocked in at 986 million.

And if you’re wondering why the August numbers look slightly different now, that’s because of a reshuffle. Robinhood $HOOD ( ▼ 8.86% ) got added to the S&P 500 Financials index, while MarketAxess Holdings $MKTX ( ▲ 3.0% ) got booted.

The financial sector itself didn’t exactly light up the scoreboard either. The S&P 500 Financial Index was basically flat, up just 0.04% last month. Meanwhile, the broader S&P 500 gained a healthy 3.53%.

Short interest is basically a measure of pessimism. It shows how many traders are betting on a stock to drop. (For the math nerds: Short Interest % = Shares Sold Short ÷ Stock Float.)

Here’s where the bears are circling most:

• Erie Indemnity $ERIE ( ▲ 1.21% ) — 8.02% (up from 7.32%)

• Apollo Global $APO ( ▼ 4.31% ) — 7.50% (up from 7.41%)

• Franklin Resources $BEN ( ▼ 4.06% ) — 7.22% (up from 6.37%)

• Robinhood $HOOD ( ▼ 8.86% ) — 7.09% (up from 3.91%)

• Coinbase $COIN ( ▼ 7.75% ) — 6.48% (up from 5.74%)

And here’s where the bears couldn’t care less:

• Chubb $CB ( ▼ 0.46% ) — 0.66% (down from 0.84%)

• Mastercard $MA ( ▼ 1.25% ) — 0.68% (down from 0.72%)

• Berkshire Hathaway $BRK.B ( ▼ 1.53% ) — 0.94% (down from 0.98%)

• Aon $AON ( ▼ 0.08% ) — 0.99% (up from 0.88%)

• JPMorgan $JPM ( ▼ 1.52% ) — 0.99% (up from 0.97%)

By industry, Capital Markets took the crown for most shorted with 2.58%, followed by Financial Services at 2.28%. The Insurance industry stayed the market’s favorite child at just 1.63% short interest.

TL;DR

• Short interest in financials nudged up to 2.04%, signaling a slight rise in bearish bets.

• Capital markets and financial services saw the most skepticism.

• Insurance stocks? Still the least hated corner of Wall Street.

THE PILL PRICE REVOLUTION 💊 

Trump’s back at it again. He’s expected to announce that AstraZeneca has joined Pfizer in cutting the prices of its drugs after striking a deal with his administration.

Here’s what’s happening:

• The announcement’s going down in the Oval Office.

• It’s all part of Trump’s “most favored nation” plan, which basically says Americans shouldn’t pay more for medicine than people in other rich countries.

• MSNBC broke the story and added that AstraZeneca will also be investing a casual $50 billion in U.S. manufacturing and R&D.

AstraZeneca’s CEO, Pascal Soriot, hinted at this back in July. He told Bloomberg he was open to U.S. consumers paying more “global” prices AKA cheaper than what they’re paying now.

Pfizer made a similar deal in September. They agreed to give big discounts on four of their drugs through a new TrumpRx website, in exchange for a three-year break from potential tariffs.

So far, it looks like Trump’s approach is working. Two of Big Pharma’s biggest names have blinked. That could set the stage for more price cuts across the board.

TL;DR

• Trump’s announcing that AstraZeneca will cut U.S. drug prices and pour $50B into U.S. operations, following Pfizer’s earlier deal.

• His “most favored nation” push might actually be moving the needle on Big Pharma costs.

1. Trade the Pharma Sentiment Shift
Trump pressuring Big Pharma into price cuts could cool investor excitement in drugmakers but boost sentiment for healthcare providers who benefit from cheaper supplies.
📌 Action: Rotate some exposure from pharma giants like $PFE ( ▼ 1.82% ) and $AZN ( ▼ 0.6% ) into healthcare service ETFs such as $IHF ( ▼ 2.25% )  (iShares U.S. Healthcare Providers ETF) or insurers like $UNH ( ▼ 3.59% )

2. Invest in U.S. Manufacturing Expansion
AstraZeneca’s $50B investment in U.S. R&D and manufacturing will ripple through industrials, logistics, and biotech infrastructure.
📌 Action: Add exposure to companies that build or supply pharma facilities — think $CAT ( ▼ 1.81% ) , $EMR ( ▼ 4.2% ) , or $DHR ( ▼ 0.99% ) .

3. Play the “Healthcare Populism” Theme
As both parties push for lower drug costs, companies innovating cheaper treatments or generics stand to gain attention and market share.
📌 Action: Look into generic drugmakers like $TEVA ( ▼ 0.05% )  (Teva) or healthcare ETFs like $XHE ( ▼ 3.31% )  (SPDR S&P Health Care Equipment ETF) that align with the affordability trend.

TRADE WAR? CHIPS DON’T CARE 😤

Semiconductors have been the star of 2025. But lately, the spotlight’s been flickering thanks to rising trade drama between the U.S. and China.

Joshua Buchalter, a senior analyst at TD Cowen, says it’s not time to panic. In an interview with CNBC, he explained that most of these investigations and export restrictions are just “negotiating tactics” ahead of a potential trade deal. In other words, this might be less about chips and more about chess.

Sure, the U.S.–China tension isn’t great news for semiconductor ETFs like SMH, SOXX, and XSD. But Buchalter says the market might be overreacting — especially when it comes to Qualcomm.

Apparently, China’s investigation into Qualcomm is tied to a small “tuck-in acquisition” in its auto division. That part of the business only brings in around $4B a year, a small slice of Qualcomm’s pie. Unless the restrictions start touching its smartphone division, there’s little reason to sweat.

And that seems unlikely. Qualcomm’s chips are everywhere in the smartphone world, and there aren’t many plug-and-play replacements.

When the conversation turned to AI, Buchalter’s tone flipped from cautious to bullish. He’s not worried about valuations, even for giants like NVIDIA.

NVIDIA’s nearly $5T market cap might look frothy, but Buchalter says it’s justified. The company is still growing like crazy and sits at the heart of the global compute ecosystem. At a multiple in the high 20s to low 30s, he doesn’t think it’s that expensive.

The way he sees it, the semiconductor boom is powered by three engines:

• More users than ever before

• More complex workloads and applications

• More use cases for AI

Even with politics and trade noise in the background, demand for computing power keeps outpacing supply.

As long as nothing truly wild happens, the chip ecosystem isn’t done climbing.

TL;DR

• Trade tension headlines are spooking chip investors, but TD Cowen’s Joshua Buchalter says it’s mostly negotiation theater.

• Qualcomm’s investigation is minor, NVIDIA isn’t overvalued, and semiconductors still have three powerful growth engines — users, complexity, and AI. The chips are still hot.

1. Ride the AI Infrastructure Boom
AI demand keeps outpacing supply, and chips power every part of that growth cycle. NVIDIA $NVDA ( ▼ 4.89% ) and key suppliers in the semiconductor ecosystem are still expanding despite noise.
📌 Action: Accumulate long-term positions in core AI infrastructure names like $NVDA ( ▼ 4.89% ) , $TSM ( ▼ 6.41% ) , or $ASML ( ▼ 4.52% ) on market pullbacks. Focus on dollar-cost averaging while AI adoption ramps globally.

2. Bet on the Underdog Chip Suppliers
While Qualcomm $QCOM ( ▼ 7.29% ) is facing a minor investigation, the real story is its embedded role in global smartphones. China’s probe looks temporary and non-threatening.
📌 Action: Add exposure to undervalued suppliers like $QCOM ( ▼ 7.29% ) and $AVGO ( ▼ 5.91% ) while sentiment is weak. Reassess after trade negotiations conclude. Likely a short-term overhang, not a structural risk.

3. Play the Semiconductor Ecosystem ETFs
Despite political drama, semiconductors are still in a long-term uptrend driven by user growth, application complexity, and AI use cases.
📌 Action: Buy and hold ETFs like $SMH ( ▼ 5.76% ) , $SOXX ( ▼ 6.27% ) , or $XSD ( ▼ 6.92% ) . Scale in during dip periods caused by trade headlines. The trend remains up as the global compute boom continues.

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