MSFT Is Overbought, Not an Automatic Sell; NET Still Looks Too Expensive to Chase
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Thursday was quiet. The major US indexes edged lower, and volume declined for a second straight session. Higher oil prices, firm economic data, and hawkish Fed commentary pushed the 10-year yield up, while Google’s latest debt filing drew less attention. The indexes were dull, but single-stock moves were not. MSFT pushed into a key resistance zone, NET and DDOG moved sharply in opposite directions after earnings, and SPCX saw less selling than feared on its first lockup-expiration day.
Macro and the Cost of Capital
July Challenger job cuts fell to 33,429, a two-year low, down 27% month over month and 46% year over year. Tech still led with 9,869 cuts. At the current pace, 2026 tech layoffs could reach about 149,023, up 67% year over year. AI remained the main cited driver, accounting for 33% of July cuts and about 24% year to date.
Initial jobless claims rose to 199,000, still below the 201,000 estimate. The prior reading was revised to 198,000, and the four-week average eased from 203,300 to 198,800. Continuing claims rose to 1.801 million versus 1.79 million expected. The labour market has not cracked, but rates are becoming more sensitive again. If upcoming inflation data run hot, markets may have to price a higher probability of a September hike. For growth stocks, the cost of capital is once again the main swing factor.
GOOG Debt and Big Tech Free Cash Flow
GOOG filed to issue about $25 billion across 10 tranches, with maturities ranging from 2 to 40 years. It is Alphabet’s third deal since 2025. The longest tranche was initially discussed at a spread of roughly 155 basis points over Treasuries. Alphabet had already issued more than $30 billion in February 2026 and $25 billion in November 2025.
Since 2025, Amazon, Google, and Meta have increasingly used debt to fund CapEx, with aggregate issuance above $350 billion. MSFT still has not needed to do the same because expected free cash flow remains positive. Big Tech free cash flow appears likely to bottom in 2026, turn positive in 2027, and accelerate in 2028. The market is effectively betting that AI monetization will outpace the debt-funded capacity build. If that path holds, equities could begin discounting the improvement 6–12 months early, pointing toward mid-to-late 2027. If prices are still depressed by then, the more important question will be whether monetization is lagging.
For GOOG, my 2027-forward valuation floor is around $297. With no current position, I would treat $300 through the current $350–$360 area as a scale-in range rather than buying a full position immediately. The risk/reward improves meaningfully closer to $300. Investors with a low cost basis can afford to wait for the cash-flow story to catch up.
MSFT: Overbought and Diverging, but Not an Automatic Sell
MSFT rose 2.54% into the $498–$516 resistance zone. A decisive breakout on strong volume would open a path toward $600+. A failed breakout would keep the stock range-bound between the mid-$400s and roughly $500.
Volume improved from the prior session but remained light in absolute terms, which looks more like a lack of selling pressure than aggressive chasing. That matters because $498–$516 is a major supply zone. Short-term traders can either fade a failed breakout or wait for confirmation before adding. RSI is overbought and showing bearish divergence, with price at new highs but the indicator failing to confirm. A technical reset is likely, either through a stronger volume-driven extension followed by a retest of $498–$516, or through a cleaner pullback that resets momentum first.
Even so, I am not planning to trim yet. Forward valuation and the second-quarter results still look healthy, and the long consolidation through $469–$498 created a reasonable support shelf. A failed breakout would imply roughly a 5% pullback from here, which is not enough to justify trading around a core position.
SPCX: First Lockup Expiration Brings Less Selling Than Feared
SPCX had a volatile first lockup-expiration day: it traded down about 1.92% at the low, then rallied roughly 6% into the close, producing a 7–8 point intraday range on higher volume. Most newly unlocked holders appeared willing to wait rather than sell aggressively, particularly with the stock below its IPO price.
The next roughly 7% unlock is expected around August 20–21. Options imply an August 21 move of roughly $115 ± $17, or about ±16%, which points to downside near $100 and upside toward the $135 IPO area. If the stock can rebound into the second unlock without heavy selling, the additional supply should be manageable. With retail enthusiasm cooler, stabilization will likely depend more on institutional demand. Rising volume with limited downside would be a constructive sign that larger buyers are absorbing supply.
NET vs. DDOG: Same Industry, Opposite Earnings Reactions
NET jumped about 16% after earnings. Results and guidance both came in well above expectations, and the company raised its full-year outlook. The setup resembles an earlier-stage PLTR: high growth combined with positive revisions. Even using 2027 forward earnings and a generous 60x P/E, my fair-value estimate is only around $100 versus a market price near $330. Momentum can keep an expensive stock stretched for longer than fundamentals alone would justify, but the eventual unwind can be severe. Existing holders can stay with the trend while watching for topping signals. I would not chase without a position. Near-term support sits at $263–$283, with another support area below $230.
DDOG fell about 9%. The quarter beat expectations, but forward growth slowed slightly quarter over quarter, and the market immediately questioned the durability of the high-growth story. At roughly 18–19% 2027 growth and a 40x P/E, my fair-value estimate is about $115. Even after the selloff, the stock still trades near $230, so valuation remains demanding. Same industry, opposite verdict: NET rallied on excellent guidance, while DDOG sold off on a modest growth deceleration. That is why trading purely on an expected earnings reaction is usually a poor long-run bet. DDOG has intermediate support at $219–$236, with deeper mean-reversion support below $166.
UBER: Valuation Is Reasonable, but the Technical Levels Still Matter
UBER has spent recent quarters prioritizing expansion over near-term profits and cleaner balance-sheet optics. My forward valuation range has barely changed: roughly $86–$130 for 2027 and $59–$89 for 2026, with a midpoint near $74. On fundamentals, the stock does not look expensive, but 2026 still appears likely to show negative growth before a cleaner earnings rebound in 2027.
Technically, $60–$76 is the key range. A move back above $76.5 would improve the setup and support holding into 2027. Below $60, I would step aside because the turnaround could be pushed out by another two years. A more convincing trend confirmation would come above $81.1.
In a low-volume market, index moves matter less and single-stock price discovery matters more. MSFT risks a failed breakout but only a modest pullback; NET is a hold for existing owners rather than a fresh chase; DDOG is cheaper but still not cheap; SPCX depends on how much supply appears at the second unlock; and GOOG continues to finance AI capacity with debt while the risk/reward becomes more attractive closer to $300.