What Happened?
Shares of telecommunications and cable services provider Altice USA (NYSE: ATUS) jumped 3.7% in the afternoon session after Federal Reserve Chair Jerome Powell signaled the central bank may cut interest rates in the coming months, sparking a broader market rally. In his remarks, Powell suggested the central bank will proceed cautiously but opened the door to lowering a key interest rate. While he gave no specific hint on the timing, the possibility of a less restrictive monetary policy was enough to boost investor confidence. The stock market jumped in response, with the S P 500 index rising 1.5% in midday trading. This widespread positive sentiment lifted equities across many sectors, including shares of Altice.
After the initial pop the shares cooled down to $2.37, up 4.6% from previous close.
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What Is The Market Telling Us
Altice’s shares are extremely volatile and have had 38 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 2 days ago when the stock dropped 4.9% on the news that the major indices continued to pull back, with technology stocks accounting for most of the market's largest decliners. A key reason for this trend is that much of the recent market gains were concentrated in the "AI trade," which includes these large technology and semiconductor companies. So this could also mean that some investors are locking in some gains ahead of more definitive feedback from the Fed. Despite the downturn, some analysts viewed this as an opportunity to own some of the "Core AI winners." Dan Ives of Wedbush Securities commented, "In our view, the tech bull cycle will be well intact for at least another 2-3 years, given the trillions being spent on AI infrastructure/software/chips/power/apps looking ahead. This remains our tech playbook and investor roadmap." Additionally, mixed earnings reports from retailers, such as Target, have added to the market's weakness. Investors are closely monitoring these reports for insights into the broader economic health and the potential impact of new tariffs on inflation.
Altice is up 0% since the beginning of the year, but at $2.37 per share, it is still trading 23.8% below its 52-week high of $3.11 from January 2025. Investors who bought $1,000 worth of Altice’s shares 5 years ago would now be looking at an investment worth $88.94.
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