U.S. Stock Market Midday Update: Fortinet falls 4.03%, concerns over downward correction triggered by high valuation and executive sell-off

U.S. Stock Market Midday Update

Fortinet fell 4.03%. Based on recent key news:

1. On July 8, Fortinet's stock price slightly decreased by 0.7%, but has risen nearly 100% year-to-date. The demand for security hardware driven by AI computing infrastructure construction has propelled the company's performance and stock price to surge simultaneously. Fortinet's first-quarter revenue was $1.85 billion, a year-on-year increase of 20%, with product revenue soaring 41% year-on-year. Source: Zhitong Finance

2. At the end of June, HSBC downgraded Fortinet's rating to "Reduce," believing that the company is trading at a price-to-earnings ratio of 46 times, which is on par with its cybersecurity peers, but the earnings per share growth rate is only 11.6%, indicating a mismatch between valuation and growth. Source: Zhitong Finance

3. On July 10, the market expressed caution regarding Fortinet's valuation, believing that its stock price may face downward correction risks. Continuous large-scale selling signals from executives suggest that the leadership may think the current stock price has exceeded basic growth expectations. Source: Zhitong Finance The cybersecurity industry is driven by AI demand, and there are valuation risks.

Stocks with High Trading Volume in the Industry

Microsoft rose 0.16%, with increased trading volume. Based on recent news,

1. On July 10, Meta CEO Mark Zuckerberg stated that the demand for AI computing power continues to exceed supply, and investors are cautious about the spending plans of large cloud computing companies, leading to a more than 20% drop in Microsoft's stock price.

2. On July 10, Meta outperformed the seven tech giants in the U.S. stock market, with research firm SemiAnalysis releasing a report optimistic about its AI computing layout, resulting in a 0.6% increase in Microsoft's stock price.

3. On July 10, Microsoft announced that its carbon emissions are expected to rise by 25% in 2025, primarily due to new data centers and the suspension of some renewable energy quota purchases, affecting its stock price. The technology sector is performing strongly overall, with continued enthusiasm for AI investments.

Oracle fell 1.98%, with increased trading volume. Based on recent key news:

1. On July 10, S&P Global downgraded Oracle's rating to "BBB-," reflecting the increased structural risks associated with its transition to AI infrastructure. Following the downgrade, Oracle's stock price rose 2.7%, as investors focused on its $638 billion backlog of cloud contracts. Source: CaiLianShe

2. On July 8, Oracle's stock price fell 25% in the first half of 2026, raising serious concerns about its customers' payment capabilities. The company provides low-cost, high-speed AI computing power based on automation and RDMA technology, but some customers' high-leverage operations may lead to defaults. Source: Caiwen Overseas Information

3. On July 10, Piper Sandler released a report stating that Oracle's cloud infrastructure business is expected to exceed current market expectations in fiscal year 2027, with analysts maintaining an "Overweight" rating and a target price of $225. Source: Zhitong Finance AI infrastructure investment risks are rising, and the market is paying attention Nebius rose by 2.46%, with active trading. Based on recent key news:

4. On July 8, Nebius announced the addition of Saturn Cloud to its AI cloud platform, supporting customers in self-deploying model fine-tuning and service platforms. This move reduced the setup work for customers on Nebius's NVIDIA-based infrastructure, driving the stock price up.

5. On July 9, Nebius's General Counsel Yael Almog submitted an initial Form 3 beneficial ownership statement, showing changes in internal holdings that may affect investor confidence.

6. On July 10, analysts rated Nebius as a moderate buy but noted that five other stocks had more investment value, impacting market expectations for Nebius. Demand in the AI industry is strong, with significant capital inflow.

Stocks ranked at the top of the industry by market capitalization

Palo Alto Networks fell by 3.96%, with increased trading volume. Based on recent key news:

1. On July 9, Palo Alto Networks' stock price dropped by 4.99% due to heightened market concerns over its short-term billing slowdown and revenue recognition delays. The company's price war in the SASE and XDR markets has led to margin pressure, further affecting the stock price.

2. On July 8, Needham raised the target price for Palo Alto Networks from $350 to $425, maintaining a "buy" rating. However, analysts believe that five other stocks are more attractive, leading to weakened market confidence in Palo Alto Networks.

3. On July 7, Palo Alto Networks board member Helle Thorning-Schmidt sold 700 shares of common stock at a transaction price of $346.85. This move was interpreted by the market as an insider's cautious attitude towards the company's prospects, increasing stock price volatility. Competition in the cybersecurity industry is intensifying, putting pressure on margins