Premarket: Apple is green

apple premarket green 4-27From TheStreet's "Dow Futures Gain as Investors Track Economic Re-openings, Central Bank Stimulus: Apple Earnings Highlight Key Reporting Week":

U.S. equity futures bounced higher Monday, while global stocks booked solid gains in markets around the world, as investors reacted to a massive stimulus push from the Bank of Japan and suggestions that key parts of the domestic economy could re-open in the coming week.

New York Governor Anderw Cuomo told reporters in Albany Sunday that a phased re-opening of the state's economy could come as early as May 15, while other states around the country have either eased certain outdoor activity restrictions or set out plans for the gradual re-start of jobs, businesses and public schools...

Futures contracts tied to the Dow Jones Industrial Average, which has gained 8.5% so far this month, suggest a 205 point opening bell gain for the 30-stock average while those linked to the S&P 500 are guiding to a 25 point advance for the broader benchmark.

Corporate earnings are likely to be in focus again this week, alongside the grim calculation of coronavirus death and infection rates, with some 169 S&P 500 companies expected to report quarterly profits this week, including heavyweights such as Apple  (AAPL) - Get Report, Microsoft (MSFT) - Get Report, Amazon  (AMZN) - Get Report and Facebook  (FB) - Get Report.

My take: From the same item...

The modestly positive movement belies data that still suggests coronavirus cases are accelerating -- 27,600 alone were reported in the U.S. on Sunday, taking the cumulative total to just over 930,000 -- and the fact that a vaccine is still likely many months away.

3 Comments

  1. Jerry Doyle said:
    Nations across the globe are anxious to reopen their economies. Many (including the USA) are doing so.

    Whether reopening at this period is judicious or negligent, most believe there will be no economies left to open if they do not attempt now the process of reopening.

    Those attempting the reopening do believe that it is safe to reopen, if proper sanitary measures are in place to operate their economies prudently for the safety of all.

    The issue seems to be what type of recovery to expect.

    There appears to be a consensus of a V-shaped recovery.

    US administration leaders are forecasting a V-shape recovery and from what we are reading in the media Tim Cook also is forecasting a V-shape recovery.

    Even JP Morgan now is proclaiming do not be surprise to see Apple offering June guidance.

    Other nations’ financial leaders are forecasting a V-shape recovery.

    This optimism of a V-shape recovery has to be predicated on the unprecedented amounts of liquidity and promised economic backstopping of world economies by the World Bank, by central banks of individual nations and the intent on individual nations to flood the economies with as much liquidity as needed.

    We always are told not to fight the FED. It looks as if that mantra is proving to be true.

    Even in the face of all the bad economic news and data to come, the markets continue to march higher. Even Apple is only 15% off its all-time high, as I write, and some other equities less so. It’s almost unbelievable!

    Myself, I still believe we will see a W-shape economic recovery because of all the humongous bad economic data to come forth.

    There is to be a tsunami of bankruptcies, and even those companies successful enough to restructure and come back will do so much smaller and leaner, meaning significant job losses.

    States are saying that they will need to furlough employees. They have state budgets to adhere to and I am not optimistic the federal government will bail out states.

    The federal government has the capacity to just keep taking on new debt.

    In summary, I see a W-shape recovery and expect the markets to head downward at least another 15-20 percent and possibly test new lows in the coming weeks and months. Apple will be impacted, but only briefly as Apple has an outstanding balance sheet, good flow of revenues and is positioned nicely to navigate these stormy economic waters.

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    April 27, 2020
    • Jerry Doyle said:
      Correction to the above…. JP Morgan is saying don’t be surprised if Apple doesn’t offer June guidance.

      I misspoke, because my mindset is Apple Will offer some form of June guidance. If Apple truly believes in a V-shape recovery, then Apple should be in a position to offer some form of guidance coming out of a V-shape recovery.

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      April 27, 2020
  2. Steven Philips said:
    Jerry: your thoughts seem very realistic and persuasive. The whole “circus” around the virus/pandemic economic/political and medical is fascinating – if only it wasn’t all so serious.

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    April 27, 2020

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