Key Takeaways
- Stocks Post Impressive First Half Gains
- China Curbing Exports Of Key Chip Metals
- Amazon Launches EV Delivery Vehicles
Although markets were open for a half day on Monday, indices were relatively unchanged. However, looking back on the first half of the year, stocks scored impressive gains. The Nasdaq Composite posted a 32% increase. That was followed by the S&P 500, which was up 16%.
The surge higher was led by technology stocks such as Nvidia, which nearly tripled in price. Advanced Micro Devices
AMD
also nearly doubled in price from where it closed out 2022. The question becomes, can these stocks continue carrying us higher, especially as the trade war with China heats up? Last week, the Biden Administration announced it would further restrict sales of chips used in artificial intelligence (AI) to China. The administration is also expected to place additional restrictions on China by requiring cloud computing companies, such as Amazon
AMZN
and Microsoft
MSFT
, to get government approval prior to providing services that use advanced AI technology. In response, China announced they will restrict exports of key chip-making metals. China is also out with disappointing services industry data this morning, contributing to some of the losses we’re seeing in Chinese stocks.
There are individual stocks making news in the premarket. Shares of Tesla
TSLA
are unchanged premarket; however, the electric vehicle (EV) manufacturer announced on Sunday they had delivered a record 466,140 automobiles in Q2, surpassing Wall Street estimates. That is being followed up by news from Rivian, who announced they delivered 12,640 vehicles in Q2, which was higher than the 11,000 being forecast. Amazon also announced that they will roll out their first batch of electric delivery vans, made by Rivian, starting today.
Other companies making news this morning include Facebook parent, Meta and Netflix
NFLX
. Meta is expected to announce a new service aimed at challenging Twitter. The service, Threads, could launch as early as tomorrow. Meantime, Goldman Sachs has upgraded Netflix to a neutral, citing the companies crackdown on password sharing and new subscriber growth. Also, Yahoo’s CEO said the company is considering an IPO. We’ve already seen a few IPOs this year and could see more. As equities climb along with bond yields, companies may look to cash in on strong stock prices and eschew debt financing which has become significantly more expensive because of higher interest rates.
Finally, although it is a holiday shortened week, we do have some significant economic data being released. Later today, minutes from the most recent Federal Open Market Committee (FOMC) will be released. It is widely expected the Fed will raise rates by a quarter point when they meet in a few weeks. Tomorrow we’ll get data on the job openings with the JOLT report and then on Friday, the June employment report will be released. Therefore, while volume may be low this week, there is ample opportunity for stocks to move around a bit. As always, I would stick with your investment plan and long term objectives.
tastytrade, Inc. commentary for educational purposes only. This content is not, nor is intended to be, trading or investment advice or a recommendation that any investment product or strategy is suitable for any person.
