Major US stock indices closed lower, marking continued weakness in the market. The NASDAQ fell for the third consecutive day, while the Dow Jones Industrial Average and the S&P 500 declined for the second straight session.
At the close, the major indices reported the following:
– Dow Jones Industrial Average down 41.31 points or 0.09% at 48,416.74
– S&P 500 down 10.89 points or 0.16% at 6,816.52
– NASDAQ down 137.76 points or 0.59% at 23,057.41
– Russell 2000 down 20.79 points or 0.81% at 2,530.66
Broadcom shares extended their recent decline despite the company posting better-than-expected earnings and revenue after the market closed on Thursday last week. The semiconductor giant reported earnings per share (EPS) of $1.95 compared with the $1.86 expected, and revenue of $18.02 billion against $17.47 billion forecast. Additionally, Broadcom issued stronger-than-expected guidance.
However, investors focused on a slight drop in profit margins, which fell by a few percentage points, raising concerns about the company’s profitability trends. This reaction reflects a wider trend within the NASDAQ, where high-multiple technology stocks are particularly sensitive to even modest disappointments.
Broadcom shares have dropped approximately 18.25% from their all-time highs recorded last Wednesday, with sellers firmly in control. From a technical perspective, the stock has fallen below its 100- and 200-hour moving averages at $385 and $368 respectively. It is now approaching a key support zone that dates back to early September, between $324.61 and $335.01. Below this area, the 38.2% retracement of the 2025 trading range comes in at $309.39.
In summary, while Broadcom’s underlying results were strong, valuation concerns and margin pressures overshadowed the positive earnings beat, making it a focal point in the broader tech-sector pullback.
Shares of Strategy (formerly MicroStrategy, ticker MSTR) fell sharply, losing $14.37 or 8.14% to close at $162.08 – a level not seen since late September 2024. Bitcoin, which the company’s share price is closely tied to, slipped 2.88% to $85,601.
MicroStrategy is essentially a leveraged proxy for Bitcoin. Its core software business has become secondary to its aggressive strategy of accumulating Bitcoin, largely funded through convertible debt and equity issuance. Consequently, MSTR shares tend to amplify Bitcoin’s moves, rising more dramatically when Bitcoin rallies and falling more sharply on pullbacks.
Key Bitcoin Holding Data:
– Total Bitcoin held: approximately 660,624 BTC
– Recent purchase: 10,645 BTC acquired between 8 and 14 December 2025 for about $980 million
– Current market value: With Bitcoin trading near $92,000 to $95,000, the total holdings are valued at roughly $61 billion
Break-Even Analysis for MicroStrategy:
The break-even price is a critical metric for investors to assess the risk of MicroStrategy’s Bitcoin exposure.
– Estimated average cost per Bitcoin: approximately $74,696
– Current Bitcoin price: around $93,000
– Safety cushion: The company is about 25% in profit relative to its average cost
If Bitcoin falls below $75,000, MicroStrategy’s unrealised profits would disappear, potentially triggering negative sentiment among shareholders. However, CEO Michael Saylor has pledged not to sell Bitcoin holdings regardless of price movements.
Other notable decliners in the market today included:
– Nebius NV (NBIS): -7.44%
– Broadcom (AVGO): -5.61%
– SoFi Technologies (SOFI): -5.28%
– Arm Holdings (ARM): -5.00%
– Grayscale Bitcoin Trust (GBTC): -4.90%
– Uber Technologies (UBER): -3.93%
– Robinhood Markets (HOOD): -3.62%
– Alibaba ADR (BABA): -3.57%
– Zoom Video (ZM): -3.32%
– CrowdStrike Holdings (CRWD): -3.38%
– Salesforce (CRM): -3.17%
Forex traders should note that the US stock market’s decline, particularly within technology and Bitcoin-related assets, may influence risk sentiment and US dollar movements. The pronounced sensitivity of tech stocks and leveraged Bitcoin proxies like MicroStrategy to market volatility highlights the importance of closely monitoring equity market developments alongside forex trades.
Original Source: Greg Michalowski of investinglive.com
