UPS Downgrade, Tesla Upgrade, Xi-Trump TikTok Call

BMO Capital analyst Fadi Chamoun delivered a bearish assessment of UPS (NYSE: UPS), downgrading the shipping giant to market perform with a $96 price target. The downgrade reflects concerns about “elusive” demand recovery, particularly in the critical B2B segment, compounded by macroeconomic challenges and shifting U.S. trade policies. Chamoun specifically cited the ending of de minimis exemptions as a significant headwind, while noting that UPS’s cost-cutting initiatives are progressing slower than anticipated. The stock responded with a 0.4% decline, underperforming the broader market.

In contrast, Baird analyst Ben Kallo upgraded Tesla (Nasdaq: TSLA) to outperform with a $548 price target, representing a bullish counterpoint to the day’s market narrative. Kallo argued that despite “a series of less than stellar quarters,” investor focus has shifted decisively toward Tesla’s future prospects. The analyst highlighted Elon Musk’s recently proposed compensation package, which is tied to ambitious targets for both product rollout and market capitalization achievement. Tesla shares gained 1.7% in early trading, significantly outpacing the market.

Thursday’s earnings reports presented a tale of two S&P 500 components with sharply divergent results. FedEx (NYSE: FDX) delivered strong fiscal Q1 2026 results, beating earnings expectations by 15 cents with $3.83 per share and surpassing revenue forecasts by $500 million with $22.2 billion in sales. The logistics company’s performance provided a positive counterweight to UPS’s struggles, though management’s full-year guidance of $17.20 to $19 per share (midpoint $18.10) fell slightly short of Wall Street’s $18.25 expectation. FedEx stock rose 1.5% premarket on the news.

Homebuilder Lennar Corp (NYSE: LEN) disappointed investors, missing earnings estimates by 10 cents with $2.00 per share and reporting revenue of $8.8 billion versus the expected $9.0 billion. The weaker-than-expected performance in fiscal Q3 2025 sent Lennar shares down 3.5% in premarket trading, reflecting concerns about the housing market’s resilience amid current economic conditions.

The financial markets monitored high-stakes diplomatic developments as Presidents Xi Jinping and Donald Trump engaged in a phone call to discuss TikTok’s future operations in the United States. According to CNBC reports, the leaders were negotiating whether China would permit a controlling interest in TikTok’s U.S. operations to be sold to an Oracle (NYSE: ORCL)-led consortium of American companies. The outcome will determine whether the popular social media platform continues operating in the U.S. or faces potential shutdown.

President Trump has repeatedly postponed implementation of legislation that would shut down TikTok, most recently extending the deadline for a resolution to December 16. Market participants recognize that a forced shutdown remains “highly unlikely,” but the negotiations carry significant implications for U.S.-China trade relations and technology sector investments. The outcome could establish important precedents for how Chinese tech companies operate in Western markets.

The Vanguard S&P 500 ETF (NYSEMKT: VOO) continued its upward trajectory, building on Thursday’s record close following the Federal Open Market Committee’s decision to cut interest rates to 3.75%. The ETF, commonly known as “the Voo,” gained 0.5% on Thursday and added another 0.3% in premarket trading Friday, demonstrating sustained investor confidence despite mixed corporate earnings and geopolitical uncertainties.

Friday’s trading session encapsulated the complex interplay between corporate fundamentals, analyst sentiment, monetary policy, and geopolitical developments that characterize modern financial markets. While individual stocks like UPS and Lennar faced headwinds, broader market indices maintained their strength, supported by accommodative Federal Reserve policy and selective corporate outperformance from companies like Tesla and FedEx.