Premarket: Apple is green

From Barron's "Dow Futures Rise, Tech Leads" posted early Friday:

apple premarket green 6-24-22

Stock futures were rising Friday, led by shares in the technology sector as bond yields pulled back...

The Nasdaq index rose more than 1.6% Thursday after the yield on the 10-year Treasury fell to 3.068%. Early Friday, the yield was at 3.063%.

Lower long-dated bond yields make future profits more valuable, especially for fast-growing tech stocks whose valuations reflect a relatively long-term stream of future profits.

Tech stocks have been hit particularly hard this year as central banks, including the Federal Reserve, have moved aggressively to boost interest rates. The Nasdaq has declined more than 28% this year.

Stock market gains Thursday came after the second day of congressional testimony from Federal Reserve Chairman Jerome Powell, who reiterated that the central bank’s efforts to cool historically high inflation by increasing interest rates could lead to a recession. The Fed chief, however, also indicated that if the economy and inflation slow down enough the the Fed could slow down the pace rate hikes.

Zach Stein, chief investment officer at investment advisory firm Carbon Collective, said that while markets have started to recover concerns that led stocks into a bear market still remain, such as rising inflation, an aggressive Federal Reserve, higher oil prices and geopolitical tensions.

“While the Federal Reserve has assured investors that it remains committed to tackling inflation, it’s unlikely that the Fed’s tactics will be enough to lower inflation, which isn’t being driven by monetary oversupply, but instead by an undersupply of goods,” Stein said. “The central bank has little power to speed up the supply chain, which is at the root cause of the inflation we’ve seen.”

Charts: Yahoo!Finance sees a neutral commodity-channel-index pattern. Max pain stays at $137 with the same call mountain at $140.

apple premarket green 6-24-22

9 Comments

  1. Michael Goldfeder said:
    @ Joseph: When referring to the market sell off you can also include ignorant; idiotic; foolish; asinine; and dumber than dirt. With a heartfelt apology to anything organic.

    From the perspective of long term Apple investors the terms: advantageous; opportunistic; windfall; the gift that keeps giving; unbelievable; and the classic reason for buybacks are all terms that come to mind. The vision and strategic planning of Apple has taken innovation to a level that has joined the marketing of products, services, balance sheet, and FCF into the most popular brand on the planet. As well as the most shareholder efficient outfit of all, by looking at how other companies fall short by comparison.

    Toss in the issuing of debt a few years ago when % rates were practically at zero, further amplifies the forward thinking from the bean counter division and IMO, that’s the Genesis for the term: “Hitting on all cylinders!”

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    June 24, 2022
    • Robert Paul Leitao said:
      Michael: Among a small investor’s most potent resources are patience and due diligence. Do the research, be deliberate in decisions and resolve to be patient and maintain resolve in one’s decisions. If share prices in general, or in specific enterprise situations, were always rational, it would diminish the opportunities for long-term gains. Especially in bear market conditions, it’s vital for one to do the research and remain as informed as possible. Warren Buffett and Charlie Munger have built an empire based on research and exhaustive due diligence. Over the years they have discovered and acquired enterprises that have created incredible long-term value for BRK’s shareholders.

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      June 24, 2022
      • Michael Goldfeder said:
        @Robert: They can talk all they want about Cathie Wood and her “disruptor stocks” which in my book are categorized as tech dreck. No earnings! Good luck with the holding risk.

        Warren and Charlie have a track record of proven success through every business and economic cycle, and are still making gobs of money based on rational investments.

        Cathie can go her unique way, but at the end of the day she couldn’t carry Warren’s cherry coke to the break room to share with Charlie’s See’s Candy!

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        June 24, 2022

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