During his US visit, Indian Prime Minister Narendra Modi met with SpaceX and Tesla CEO Elon Musk to explore expanding technological collaboration between India and the United States.

:Prime Minister and Mr. Musk discussed strengthening collaboration between Indian and US entities in innovation, space exploration, artificial intelligence, and sustainable development,” India’s ministry of external affairs said in a release.

“Their discussion also touched on opportunities to deepen cooperation in emerging technologies, entrepreneurship and good governance,” it added.

While no details of the meeting’s agenda were provided, reports indicate that discussions primarily revolved around Tesla’s investment plans and Starlink’s long-pending entry into India.

At a joint press conference following the meeting, US President Donald Trump remarked that he was unsure of the exact purpose behind the meeting but speculated that Musk “wants to do business in India.”

According to an Economic Times report which has cited sources, PM Modi and Musk met to prepare a “bilateral roadmap for enhancing technology partnership”. 

The meeting is understood to have focussed on Tesla’s investment plans for India and Starlink’s entry into the country, besides India’s policies on AI, the report said.

“Musk is understood to have sought lower tariffs on imported EVs, getting an early license for Starlink to offer satellite internet services in India, and expanding SpaceX’s collaboration with ISRO,’ it said.

Starlink’s regulatory battle in India

Starlink, SpaceX’s satellite internet division, has been eager to launch operations in India.

The Indian government has expressed support for assigning spectrum rather than auctioning it, aligning with Musk’s preference.

However, despite this backing, Starlink’s license remains under regulatory scrutiny.

The Telecom Regulatory Authority of India (TRAI) was initially expected to finalize its spectrum allocation guidelines by December 2024, but the process has been delayed, leaving uncertainty over when Starlink can officially launch services in the country.

Domestic telecom providers, including Reliance Jio and Bharti Airtel, have strongly opposed allowing foreign satellite companies like Starlink and Amazon’s Kuiper to enter India without undergoing a spectrum auction, arguing that such a move would put local firms at a disadvantage.

With India’s satellite services market projected to grow at a rate of 36% per year and reach $1.9 billion by 2030, the stakes are high for Starlink as well as other players.

Security concerns after Starlink devices found with smugglers

Starlink’s troubles in India have deepened after its communication devices were discovered in the possession of drug traffickers and insurgents.

In a major operation in the Andaman & Nicobar Islands, authorities seized Starlink terminals used by Myanmar-based smugglers to create Wi-Fi hotspots for navigation.

The Indian Ministry of Home Affairs and the Department of Telecommunications have demanded details on the original buyers of these devices.

However, Starlink has refused to share user information, citing data privacy laws.

A government official confirmed to ET last month that the Ministry of Home Affairs has instructed telecom authorities to take “appropriate steps” to address the issue.

Starlink has been in discussions with the DoT and MHA, seeking clarification regarding the regulatory obstacles it faces while continuing to request permission to operate in India.

The government has indicated that it will not grant Starlink permission to operate in India until it is satisfied with the company’s security measures, including how it plans to address the illegal use of its devices and control data movement.

“Musk is agreeable to give assurances on India security concerns, which includes storing data locally,” one of the sources told Reuters before the meeting.

In addition to the drug smuggling case, Starlink devices have also been found in the hands of insurgents in the northeastern state of conflict-ridden Manipur.

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The US economy faced a dual setback in January, with both retail sales and manufacturing output recording declines.

Retail sales posted their largest drop in nearly two years, while manufacturing production unexpectedly contracted, largely due to a sharp decline in motor vehicle output.

Retail sales fall amid freezing temperatures and tariff concerns

According to the Commerce Department, US retail sales fell 0.9% in January—the biggest decline since March 2023—following a revised 0.7% increase in December.

The drop was broad-based, with sales at auto dealerships plunging 2.8%, clothing stores down 1.2%, and online sales falling 1.9%.

Cold weather and snowstorms across the country played a role in discouraging consumer spending.

Economists also point to rising inflation expectations and uncertainty over new trade tariffs as factors affecting consumer confidence.

A University of Michigan survey last week showed that households believe it may now be too late to avoid the negative impact of new import levies.

A 10% tariff on Chinese goods was implemented this month, while a planned 25% tariff on Mexican and Canadian imports has been delayed until March.

Manufacturing contracts as auto production slumps

US manufacturing production fell 0.1% in January after a downwardly revised 0.5% increase in December, according to Federal Reserve data.

Economists had expected a slight gain.

The decline was largely driven by a steep 5.2% drop in motor vehicle and parts production.

The broader manufacturing sector, which makes up about 10.3% of the economy, had shown signs of recovery in recent months following the Federal Reserve’s interest rate cuts.

However, protectionist trade policies under President Donald Trump, including new tariffs on steel, aluminum, and Chinese imports, have introduced fresh challenges.

Economists warn that disruptions to global supply chains could lead to higher raw material costs, further straining manufacturers.

Economic outlook remains uncertain

Despite weaknesses in retail and manufacturing, other areas of the economy showed resilience.

Utilities output surged 7.2% as demand for heating spiked due to extreme weather conditions. Industrial production as a whole rose 0.5% in January, following a 1.0% increase in December.

Meanwhile, retail spending at restaurants and bars—a key indicator of household financial health—climbed 0.9%, offering a positive signal for consumer demand.

However, the overall decline in retail and factory activity raises concerns about economic growth in the first quarter.

With trade tensions persisting and interest rate policy uncertain, businesses and consumers alike are navigating an increasingly complex economic landscape.

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Baidu, China’s largest internet search company, announced that it will offer its AI chatbot Ernie Bot for free starting April 1, as competition in the AI sector heats up.

The AI service will be accessible at no cost to all users on both desktop and mobile platforms, Baidu said in a WeChat post.

The move comes as rival AI models, including those from emerging Chinese startup DeepSeek, gain traction in the market.

The company made the announcement on WeChat on Thursday, just hours after OpenAI CEO Sam Altman revealed that ChatGPT users would have unlimited access to GPT-5 for free, though paid subscribers would get access to more advanced features.

On Friday, Baidu added that it would launch the next generation of its AI model by the end of June and, for the first time, make it open source, mirroring DeepSeek’s approach.

It will also introduce a free “Deep Search” function in April, offering enhanced reasoning and expert-level responses.

Baidu stock surges 12% on Ernie Bot announcement

Baidu’s decision to make Ernie Bot freely available appears to be a strategic move to counter competition from both domestic and global players.

DeepSeek’s recent R1 AI model has drawn significant attention for delivering performance comparable to US industry leaders at a much lower cost.

Baidu’s stock surged as much as 12% in Hong Kong trading following the announcement, last trading at 95 Hong Kong dollars ($12.20) per share on Friday.

The company’s strong performance has contributed to a 20% rise in the Hang Seng China Enterprises Index since January.

Chinese startups challenge tech giants

Since ChatGPT’s debut in late 2022, Chinese tech giants have been racing to develop homegrown AI alternatives.

Baidu was among the first to launch its own model, ahead of competitors like Tencent and Alibaba.

However, its Ernie Bot has struggled to keep pace with newer models such as ByteDance’s Doubao, which has outperformed it in user engagement.

Emerging AI startups such as DeepSeek and Moonshot AI are also making waves.

Moonshot AI’s chatbot, Kimi, launched late last year and was the third-most visited AI chatbot in China in January, behind DeepSeek and Doubao, according to AI product tracker aircpb.com.

Zhipu AI, another rising player backed by Tencent and Alibaba, has gained attention for its strong government ties but was recently placed on the US Commerce Department’s Entity List over alleged military connections, a claim it denies.

AI firms shift to free services

Most leading AI companies, including OpenAI and Anthropic, have introduced free basic versions of their chatbots, with premium features available through subscription plans.

ChatGPT initially launched as a free service before adding a paid tier for advanced capabilities.

Baidu previously charged users for Ernie Bot’s premium functions, including AI-generated images, with monthly fees reaching 59.9 yuan ($8.20).

Despite competition, the chatbot has built a significant user base, amassing 430 million users as of November 2024.

By making Ernie Bot free and open source, Baidu is looking to regain its position as a dominant player in China’s rapidly evolving AI landscape.

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Wall Street closed mixed on Friday as investors took a breather after a strong week, digesting developments in global trade policy and inflation data.

While the Dow Jones Industrial Average dipped slightly, the S&P 500 and Nasdaq Composite eked out gains, reflecting continued optimism amid economic uncertainty.

Market sentiment remained resilient despite a sharper-than-expected decline in retail sales, as traders found reassurance in President Donald Trump’s measured approach to tariffs and inflation trends that may ease pressure on interest rates.

The Dow slipped 108 points, or 0.2%, while the S&P 500 edged up 0.1%, and the Nasdaq gained 0.3%.

For the week, the S&P 500 rose 1.5%, the Dow added 0.7%, and the tech-heavy Nasdaq outperformed with a 2.3% gain, buoyed by strong earnings in the sector.

Trade policy eases investor’s nerves

A key driver of this week’s market momentum was Trump’s decision to implement trade tariffs selectively rather than imposing sweeping levies.

On Thursday, he signed a memorandum outlining a plan to impose tariffs on goods from countries that restrict US exports, alleviating concerns over a broader trade war.

This policy shift helped boost investor confidence, leading to a rally in equities.

Additionally, fresh economic data provided mixed signals.

While January retail sales fell 0.9%, worse than the expected 0.2% drop, traders largely brushed off the report.

More encouragingly, inflation data from the consumer price index (CPI) and producer price index (PPI) pointed to a softer outlook for the Federal Reserve’s preferred inflation gauge, the personal consumption expenditures (PCE) index, due later this month.

This reinforced expectations that the Fed may not need to accelerate rate hikes, supporting equity valuations.

The 10-year Treasury yield fell over 6 basis points on Friday to 4.459%, continuing its downward trend this week.

Dell surges on AI-driven demand

Dell Technologies shares climbed more than 3% after Bloomberg reported that the company is nearing a deal to sell servers equipped with Nvidia chips to Elon Musk’s artificial intelligence startup, xAI.

The potential deal underscores the growing demand for AI infrastructure, fueling investor enthusiasm.

Dell’s stock is now up more than 9% for the month.

Other top news in US markets

The Trump administration’s 25% tariffs on steel and aluminum imports could trigger a wave of short covering in US steel stocks, according to S3 Partners.

Managing director Ihor Dusaniwsky stated that this move may spur increased buying in domestic metal and mining stocks while intensifying selling pressure in international counterparts, adding to market volatility.

Defense stocks remained under pressure following Trump’s remarks about potential defense spending cuts.

Despite his suggestion of a future trilateral agreement with China and Russia to reduce military expenditures by 50%, Wall Street analysts see no realistic path for such cuts, given broader geopolitical uncertainties.

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AppLovin stock price has gone parabolic since 2023, making it one of the best-performing companies in Wall Street. APP shares surged to $520 this week, a remarkable surge considering that it was trading at $9.75 in 2023. This surge has brought its market cap to over $150 billion. This article explains why the Applovin stock price may crash soon.

AppLovin business is thriving

Results released this week showed that Applovin’s business continued to do well in the fourth quarter, capping what has been its best year on record.

Its Q4 revenues jumped to $1.3 billion, a 44% annual increase. This growth brought its annual revenue to $4.7 billion, up by 43% from the previous year. 

Most of this revenue growth came from its advertising business, whose revenue jumped by 73% to near $1 billion. This is a notable figure since this business is a fairly new one in its ecosystem. Its original app development business continued its slowdown, with its revenue falling by 1% to $373 million.

AppLovin has become a profitable company, a trend that may continue in the coming months. Its net income rose by 248% in the last quarter to near $600 million. This brought its annual profit to $1.57 billion, a 343% annualized increase. It also means that its profit margin is about 46%. 

AppLovin’s momentum will likely continue in the coming years as it attracts more demand. Some of its top customers so far are the likes of Spotify, OpenTable, Hotels.com, and Groupon. 

Still, there are two main reasons why the AppLovin stock price may suffer a harsh reversal in the next few months.

APP’s valuation is stretched

The first main reason why the AppLovin stock price may crash soon is that its valuation is highly stretched. 

As mentioned, AppLovin’s annual revenue came in at $4.7 billion in 2024, and analysts expect it to get to $5.84 billion in 2025 and $7 billion in 2026. A $7 billion annual revenue for a company valued at over $150 billion is a big stretch, even as it experiences a double-digit growth rate. 

These numbers mean that the company is highly overvalued, as its forward price-to-sales ratio is over 21. That is a big valuation metric since taking it private at the current valuation and assuming no growth, will take 21 years to recover the funds. 

AppLovin has a forward PE ratio of 74, higher than the S&P 500 average of 22. Popular companies like Microsoft, NVIDIA, and Meta have a much lower valuation metric.

Wyckoff’s Theory suggests an AppLovin stock price crash

The Wyckoff Theory, which was developed over 95 years ago suggests that the AppLovin stock price will crash soon as smart money investors start to take profits.

The chart above shows that the APP stock price remained in an accumulation phase in 2022 and 2023. This phase is usually followed by the markup, which started happening in 2024 as the Fear of Missing Out (FOMO) intensified. FOMO is characterized with bullish hype for an asset, including the ingoing calls to add it to the Magnificent 8 category. 

Therefore, the AppLovin stock price will then get to the distribution phase, followed by the markdown, where assets crash. A crash will likely trigger a panic among investors, pushing it lower over time.

This arrangement has happened in other companies before. Some of the most notable ones were companies like Celsius Holdings and Super Micro Computer. All these stocks surged in 2023 and then crashed in 2024.

Read more: AppLovin stock has surged: brace for mean reversion in 2025

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