Monday's trading session on Wall Street saw Alphabet and Tesla lead the way in nominal gains. Google is recouping some of its losses from recent weeks and is up about 4% during today's session.
The main catalyst was the symbolic—though market-significant—debut of GOOGL shares on the Dow Jones Industrial Average—the company replaced Verizon and became the first NYSE-listed firm to join the ranks of the five members of the “Magnificent Seven” in the iconic 30-component index, alongside Nvidia, Amazon, Apple, and Microsoft. Due to its share price (~$350), Alphabet immediately rose to sixth place in terms of weighting in this price-weighted index.
An additional catalyst for the gains was an FT report revealing that Google is limiting access to computing power for key enterprise clients, including Meta. While this sounds alarming, in the short term, the market interpreted it as a signal that demand for Gemini exceeds supply—which, paradoxically, reinforces the narrative about the product’s strength.
Despite this rebound, the macro context for GOOGL remains challenging. The company is having one of its worst months since February of last year—it has closed in the red in six of the last seven weeks. Investors are pricing in a number of risks: the exodus of key talent from DeepMind (including Noam Shazeer, who left for OpenAI), price pressure from Chinese models (DeepSeek V4 is expected in the coming weeks), as well as balance sheet tensions—Alphabet skipped its share buyback program in Q1 for the first time in nearly a decade, and total debt rose by over $140 billion to finance the AI capex race.
A debut on the Dow is a milestone—but it doesn’t change the fundamentals on its own. It’s worth remembering that the last three companies added to the index (Nvidia, Salesforce, Apple) lost value for 60 days after being included in the DJIA. The key question for investors remains unanswered: Will the massive capital expenditures translate into AI profits before lower-priced models from China push Gemini out of the enterprise market?
GOOGL shares are attempting to rebound above the 100-day EMA, which may serve as a key control point from a technical analysis perspective. Source: xStation
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