A week that started with a coronavirus panic looks set to end on a high note. Earnings optimism and the fact that investors no longer seem to be panicking over the deadly China illness is helping.
Wall Street has also been distracted by red-hot Tesla TSLA, 0. % shares, up % this week. The stock has now more than doubled over three months. While some warn of nosebleed territory , consumer advocate Ralph Nader said Tesla could end up triggering a market crash.
To be sure, other stocks may be getting far less attention, which brings us to our call of the day from Wedbush analyst Dan Ives who has bumped his Apple AAPL, 0. 60% share price target to $ 2020 from $ . He says Wall Street is underestimating a renaissance for the iPhone maker, and the “magnitude of the 5G upgrade cycle.”
(Ives is upbeat after a visit to Asia, where he says iPhone suppliers appear to be doing well, implying customers want to buy. He added that AirPods demand is “jaw dropping,” and he expects upbeat results next week and strong March guidance.
“While the stock has had a massive rally over the past year and thus far in , we continue to believe this is a ‘must own’ stock into what we would characterize as a transformational 5G supercycle over the next to months with Apple being our favorite 5G play, ”said the analyst who has been pounding the table over Apple’s fortunes lately.
Apple shares are up around 9% so far this year, % over three months and 94% in the past six months. Note that Ives helped fuel the rally for the electric-car maker’s shares this week by bumping up his price target 60%.
Bottom line, he says, all the good news isn’t baked into the share price yet.
Note Apple results are due Jan. and Tesla Jan. 50.
Read: Broadcom says deals with Apple could be worth $ (billion)
YM , 0. 50%
, S&P ES , 0. 31% and Nasdaq NQ , 0. % futures are higher, while European stocks (SXXP, 1. % are rallying hard. Asia was largely quiet as several markets closed for the Lunar New Year holiday. The Nikkei (NIK, 0. 23% inched up.
Bitcoin (BTCUSD, 0. (%) has lost over 6% this week amid talk of slowing demand ahead of the China holiday.
volatility and volumes to nose dive. – Arthur Hayes (@CryptoHayes) (January) , The chart
Crude CL CL) , – 0. (%)
is down nearly 13% so far this year, but better times are ahead, according to our chart from Adam Kobeissi of The Kobeissi Letter . He sees crude dropping to $ , then a “final washout” before it charges back to $ a barrel.
A buying opportunity is at hand as “rig count continues to drop, geopolitical tensions remain with zero risk premium priced into the commodity, and the dip on the coronavirus news appears to be a vast overreaction,” he told MarketWatch.
Intel INTC , 0. 400% shares are climbing after the tech group’s earnings and forecast beat expectations , though some argue its future is hazy . American Express (AXP, – 0. % shares are up after earnings also came in ahead of forecasts. Ericsson (ERIC, 0. (%) stock is slumping after higher costs hit the Swedish telecom’s earnings .
China is building a hospital to treat coronavirus patients as the death toll reaches 31 and several countries report infections. That’s as more cities face travel bans, with Reports of panic buying of food and gas in places like Wuhan.
After the market opens we’ll get the IHS Markit manufacturing and services purchasing managers indexes.
This is basically the opposite of central banks trying to hit their inflation targets! https://t.co/jZjylslAkG – Rishi Mishra (@aRishisays) January ,
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Chinese market believed to be at the coronavirus epicenter sells stomach-churning fare
The Doomsday Clock is now 823 seconds to midnight
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