Alphabet could more than double its capex in 2026, unsettling investors

Alphabet's recent financial report revealed a strong performance, with its fourth-quarter earnings and revenue surpassing Wall Street's expectations. Notably, the company's cloud division showcased impressive growth, achieving a remarkable 48% increase in revenue compared to the previous year. Looking ahead, Alphabet has set an ambitious capital expenditure target for 2026, estimating it will range between $175 billion and $185 billion. This projection suggests a more than twofold increase over last year’s expenditures, raising concerns among investors. As a result, Alphabet's stock experienced a decline of up to 3% during after-hours trading, ultimately settling with a smaller loss of 0.39%. In contrast, Broadcom, a key supplier of custom chips for Alphabet, saw its shares rise over 6% in after-hours trading, recovering from earlier losses in the regular session where it had dropped 3.8%. Other tech companies, including Advanced Micro Devices, faced significant downturns, with AMD's stock plunging 17.3% following a disappointing first-quarter forecast. The broader market reflected this turbulence, as the tech-heavy Nasdaq Composite fell by 1.51%, while the S&P 500 dipped 0.51%, marking its fifth negative session in six. However, the Dow Jones Industrial Average experienced a slight increase of 0.53%, buoyed by gains from companies like Amgen and Honeywell. Despite the shaky sentiment surrounding AI investments, CNBC Investing Club founder Jim Cramer expressed optimism about South Korean chipmakers, praising Samsung Electronics and SK Hynix as innovative leaders in the industry. Meanwhile, the market for silver remains volatile, with prices dropping by as much as 16% recently, breaking a two-day recovery streak. In Europe, BNP Paribas reported fourth-quarter earnings that exceeded expectations and raised its net income target for 2025 to 2028, while Shell fell short of its profit targets. On the monetary policy front, both the European Central Bank and the Bank of England are set to announce decisions, though no changes to interest rates are anticipated. In a related development, the U.S. has proposed a critical mineral trade bloc, unveiling initiatives to strengthen alliances with coordinated pricing and financing efforts in this sector. This announcement follows a recent 'Critical Minerals Ministerial' meeting, where bilateral agreements were established with 11 nations. Meanwhile, the Chinese electric vehicle market is showing signs of a slowdown, with BYD reporting a near two-year low in local sales and several major brands experiencing sharp declines in sales. As discussions around Taiwan escalate, Chinese President Xi Jinping called on U.S. President Donald Trump to exercise caution regarding arms sales to the region. The two leaders also touched upon various global issues during their talks, including Iran and Russia's ongoing conflict in Ukraine. Overall, the latest developments highlight a complex landscape for investors, with significant shifts in technology and economic policies shaping market dynamics.