Palantir Technologies saw its shares drop 2.3% to close at $139.63 during Tuesday's trading session. The decline occurred even as Daiwa Securities Group raised its rating on the stock to "buy" and set a price target of $180.
Market Volatility and Macro Focus
The stock traded within a wide range, between $137.78 and $146.24, reflecting the heightened volatility surrounding high-growth software names. Broader U.S. equity markets closed mixed following disappointing retail sales data, with many investors adopting a cautious stance.
Market participants are primarily focused on the upcoming U.S. nonfarm payrolls report scheduled for Wednesday. This key economic indicator is expected to influence Federal Reserve rate-cut expectations and, consequently, investor appetite for premium-valued technology stocks like Palantir.
Internal and External Scrutiny
Beyond market dynamics, Palantir continues to navigate internal scrutiny regarding its government contracts. According to a report, CEO Alex Karp addressed employee concerns about the company's work with U.S. Immigration and Customs Enforcement (ICE) in a lengthy internal video. Karp acknowledged the company was "behind the curve internally" on the issue and reportedly offered non-disclosure agreements for staff seeking more detailed information.
Persistent questions about political backlash and the sustainability of demand for its artificial intelligence platforms add layers of risk for the company. As a stock often viewed as a bellwether for AI software sentiment, Palantir remains highly sensitive to shifts in macroeconomic data and investor risk tolerance.
