Economic tail risks rise to 30% from 10%, Apollo’s Torsten Slok says
While the economy continues to perform well, economic “tail risks” have risen to 30% from 10%, according to a daily note by Apollo Global Management chief economist Torsten Slok. “The risk of a sudden shift in investor sentiment is rising,” he said.
“What could suddenly change the current situation? It could be geopolitics, government debt levels or a rapid rise or fall in interest rates,” Slok wrote. “Predicting the future path of AI adoption and productivity is particularly challenging.”
The risk of a recession will grow if artificial intelligence fails to meet expectations, especially since AI continues to expand as a proportion of GDP growth, the economist added.
The labor market is another risk. “If AI were to trigger a sharp rise in unemployment, it could also have a disruptive impact on the economy and financial markets,” Slok said.
— Scott Schnipper
Fed Governor Cook warns of rising unemployment from AI
Federal Reserve Governor Lisa Cook said Tuesday that artificial intelligence could cause an increase in unemployment that monetary policy can’t help.
In a speech before the National Association for Business Economics, the central banker spoke of “new opportunities for AI while cautioning about challenges.
“if AI continues to raise productivity, economic growth could remain strong, even as churn in the labor market leads to an increase in unemployment,” she said. “In a productivity boom such as this, a rise in unemployment may not indicate increased slack. As such, our normal demand-side monetary policy may not be able to ameliorate an AI-caused unemployment spell without also increasing inflationary pressure.”
In that case, Cook said “education, workforce, and other policy that is nonmonetary” may be better-suited to address the issue than Fed rate cuts.
— Jeff Cox
S&P 500 opens little changed
The S&P 500 began Tuesday’s session little changed.
The broad market index traded down 0.1% shortly after the opening bell. The Nasdaq Composite also traded just below the flatline, while the Dow Jones Industrial Average added 29 points, or 0.1%.
— Sean Conlon
AMD, Home Depot, Hims & Hers Health among the stocks making premarket moves
Check out the companies making headlines before the bell:
Advanced Micro Devices — The semiconductor maker rose about 11% after it inked a multiyear deal with Meta to lend up to 6 gigawatts of its graphics processing units to artificial intelligence data centers. The cost of the deal is unclear, but the companies’ agreement includes a a performance-based warrant that could amount to up to 160 million of AMD shares, according to a statement dated Tuesday.Home Depot — The home improvement retailer gained 2.7% after posting fourth-quarter adjusted earnings of $2.72 per share on revenues of $38.20 billion. That exceeded the per-share earnings of $2.54 on revenues of $38.12 billion expected by analysts polled by LSEG.Hims & Hers Health — Shares dropped nearly 7% after the online health platform posted disappointing guidance. Hims & Hers Health forecasts first-quarter revenue in the range of $600 million to $625 million, far below the $653 million expected by analysts surveyed by FactSet. First-quarter adjusted EBITDA is expected to come in the range of $35 million to $55 million, below the $82M StreetAccount estimate.
Read the full list here.
— Sarah Min
Blue Owl shares fall following downgrade
Blue Owl signage outside the Seagram Building at 375 Park Avenue in the Midtown East neighborhood of New York, US, on Tuesday, Jan. 20, 2026.
Bing Guan | Bloomberg | Getty Images
Deutsche Bank sees shares of Blue Owl Capital stagnating from here, citing slower fee-related earnings growth, as the private credit poster child’s struggles continue.
Analyst Brian Bedell downgraded the stock to hold from buy. He also slashed his price target to $10 from $15, which implies downside of 4%.
Shares of Blue Owl have plunged 52% over the past 12 months and 30% this year alone, swept up in an overall private credit sell-off amid fears that the sector could be cracking because of their exposure to software industry loans just as Wall Street tries to open the market up to retail investors. The stock also sank after it permanently restricted withdrawals from one of its retail-focused debt funds amid plans to wind down the portfolio.
Blue Owl stock lost 2% on Tuesday morning.
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CNBC Pro subscribers can read more here.
— Lisa Kailai Han
Fed’s Goolsbee says no rate cuts until inflation eases
Chicago Federal Reserve President Austan Goolsbee said Tuesday he doesn’t think the central bank should be cutting interest rates further with inflation this high.
“People express that prices are one of their most pressing concerns. Let’s pay attention. Before we cut rates more to stimulate the economy, let’s be sure inflation is heading back to 2%,” he said in remarks before the National Association for Business Economics.
Goolsbee is a voter this year on the rate-setting Federal Open Market Committee.
— Jeff Cox
Advanced Micro Devices signs multi-year deal with Meta to lend GPUs to AI data centers
Lisa Su, chair and chief executive officer of Advanced Micro Devices Inc. (AMD), during the 2026 CES event in Las Vegas, Nevada, US, on Monday, Jan. 5, 2026. At CES, the biggest names in tech will make the case for artificial intelligence for a target audience of investors, corporate clients and, perhaps just as importantly, ordinary shoppers who have yet to be fully sold on the idea of AI-infused gadgets. Photographer: Bridget Bennett/Bloomberg via Getty Images
Bloomberg | Bloomberg | Getty Images
Advanced Micro Devices has inked a multi-year deal with Meta to lend up to 6 gigawatts of its graphics processing units to artificial intelligence data centers.
Meta’s investment in AMD includes a performance-based warrant that could amount to up to 160 million of AMD shares, according to the companies’ joint statement dated Tuesday. The allocation is structured to vest as specific milestones associated with Instinct GPU shipments are hit.
The firms’ agreement also includes the use of AI-optimized central processing units, or CPUs. Early shipments of MI450 GPUs in AMD’s Helios rack-scale servers will begin later this year.
The cost of the deal remains unclear as of writing time. However, Meta said in an earnings report last month that it planned to commit up to $135 billion in capital expenditures this year — a bid to stay competitive with megacap peers, in addition to OpenAI and Anthropic, in the global AI race.
— Liz Napolitano
Home Depot rises on earnings beat
Signage for a Home Depot store is shown in Brampton, Ontario, on November 6, 2025. (Photo by Mike Campbell/NurPhoto via Getty Images)
Nurphoto | Nurphoto | Getty Images
Home Depot posted better-than-expected results for the fourth quarter, sending shares up nearly 4%. The company earned $2.72 per share on revenue of $38.2 billion. Analysts polled by LSEG expected a profit of $2.54 per share on revenue of $38.12 billion.
The home improvement retailer also kept its current fiscal year forecast.
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Trump’s tariffs take effect at lower-than-expected 10% rate
A container ship floats loaded with shipping containers at the Port of Los Angeles on February 20, 2026 in Los Angeles, California.
Mario Tama | Getty Images
President Donald Trump announced over the weekend that a new, blanket 15% global levy would be applied to imports to the U.S. with immediate effect. The president initially announced plans to impose a 10% duty on global imports, before saying that the rate would rise “to the fully allowed, and legally tested, 15% level.”
However, when the levy came into effect on Tuesday, it was at a rate of 10%. A customs notice from U.S. Customs and Border Protection, published Monday evening, said Temporary Section 122 Duties would see “an additional 10% ad valorem duty on imported articles of every country for a period of 150 days, unless specifically exempt.”
— Chloe Taylor
European stocks fall as tariffs take effect
Flags of the European Union fly outside the EU headquarters in Brussels, Belgium, on December 19, 2025. (Photo by Jonathan Raa/NurPhoto via Getty Images)
Nurphoto | Nurphoto | Getty Images
European stocks moved lower on Tuesday as investors assess the new global trading landscape after U.S. President Donald Trump’s latest tariff move.
By 9:06 a.m. in London (4:06 a.m. ET), the pan-European Stoxx 600 was 0.1% lower, with regional bourses in mixed territory.
Read more on moves in European markets here.
— Chloe Taylor
Keysight Technologies, Diamondback Energy move on after-hours earnings results
Below are some of the biggest after-hours movers on Monday evening:
Keysight Technologies — The manufacturer of electronics test and measurement equipment exceeded first-quarter estimates on top and bottom lines, leading shares to jump more than 15%. Keysight earned $2.17 per share, on an adjusted basis, while analysts polled by LSEG expected $2.00 per share. Revenue came out at $1.60 billion, also higher than the $1.54 billion expected.Diamondback Energy — Shares lost 3% in after-hours trading after the company’s fourth-quarter earnings disappointed Wall Street. Diamondback reported adjusted earnings of $1.74 cents per share on $3.38 billion in revenue, while analysts polled by LSEG expected $2.08 in earnings per share and $3.31 billion in revenue.Vir Biotechnology — Shares surged more than 65%. The company shared positive updated Phase 1 results for its VIR-5500 treatment for patients with metastatic prostate cancer.
— Pia Singh
Sarat Sethi owns Salesforce, Workday ahead of earnings
Sarat Sethi, managing partner at Douglas C. Lane & Associates, said he owns Salesforce and Workday ahead of their earnings results this week that will be closely watched by investors.
Both Salesforce and Workday have been punished this year, tumbling more than 33% and 40%, respectively, as investors fearful of AI disruption took a sharp pivot out of the software sector.
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Salesforce, YTD
Sethi is hopeful that their earnings could reverse their fortunes if both companies can prove they have staying power. He noted that Salesforce has a great install base. It’s also valued at roughly 13 times forward earnings, according to FactSet data, implying the stock is now a bargain.
“The question is going to be, are they getting displaced? Are they losing customers?” Sethi told CNBC’s “Power Lunch.” “If none of that’s true, and they’re still growing, and they have the potential to grow and use AI, we think now you’ve gone from kind of a growth-at-a-reasonable-price to a value stock.”
“I’m just hoping it doesn’t become a value trap,” he added.
Salesforce is set to report earnings Wednesday. Workday is scheduled to release results Tuesday.
— Sarah Min
U.S. stock futures open little changed