Stocks recap
Stocks recap
WEEKLY STOCKS RECAP
IN TECH
AI expansion boosts the Alphabet.
Alphabet (NASDAQ:GOOGL) (NASDAQ:GOOG) shares rose Thursday after it announced it would launch its artificial-intelligence chatbot, Bard, across Europe and Brazil to compete with ChatGPT.
As Alphabet invests in AI, Google Search, which accounts for most of its revenue, will likely become “more personalised” and build “critical competitive moats,” Morgan Stanley warned.
GOOGLE rose 6% to $125.42.
Musk launches xAI.
Musk launched his xAI artificial intelligence company Wednesday.
Musk has warned about AI and signed a statement in March calling the battle for AI domination “an out-of-control race to develop and deploy ever more powerful digital minds that no one – not even their creators – can understand, predict, or reliably control.”
Musk claimed his idea for safer AI is to make it “maximally curious” instead of programming morals, adding, “I think it is going to be pro-humanity from the standpoint that humanity is just much more interesting than not-humanity.”
Coinbase boosts Ripple Labs’ court triumph.
A federal judge declared Thursday that Ripple Labs did not violate federal securities law by trading its blockchain currency, XRP, on public exchanges, sending Coinbase (NASDAQ:COIN) shares soaring.
After the news, Needham & Company maintained Coinbase’s Buy rating and boosted its price target to $120 from $70.
Needham called the summary judgement “a positive read-through to COIN as it sets precedent that crypto token sales through exchanges, at least in the XRP case, did not violate securities laws”. This should moderately reduce regulatory pressure on the stock.”
Analysts appreciate Salesforce price hike.
Salesforce (NYSE:CRM) shares rose Tuesday after the firm announced its first price rise in seven years, effective next month.
Sales Cloud, Service Cloud, Marketing Cloud, Industries, and Tableau will cost 9% higher on average.
Needham & Company raised its price objective to $250 from $230, citing “opportunity for top and bottom line benefit.”
Salesforce shares rose 9.5% to $229.33 after Tuesday’s 4% gain.
IN EV SPACE
Nikola rockets with hydrogen deals
Nikola Corp (NASDAQ:NKLA), an American vehicle manufacturer, made headlines this week when its stock price rose 62% on Thursday after a strategic supply collaboration with BayoTech.BayoTech will buy up to 50 Nikola Class 8 hydrogen fuel cell trucks over five years, under the collaboration agreement. The first 12 trucks will arrive in 2023–2024.”Nikola and BayoTech are united by a common goal of providing reliable access to hydrogen throughout the United States,” stated Nikola Corporation President and CEO Michael Lohscheller.Nikola will buy up to 10 BayoTech HyFill hydrogen transport trailers for this project. High-pressure hydrogen is transported via these trailers.Lohscheller said BayoTech’s low-carbon hydrogen fuel and transport technology will help Nikola’s Class 8 fuel cell electric zero-emission trucks take off.
Nikola became Bosch (NS:BOSH)’s volume production fuel-cell power module pilot customer along with BayoTech.Bosch announced $2.8 billion on hydrogen fuel cell technology from 2021 through 2026 on Thursday. Bosch expects 20% of new six-ton trucks to use fuel-cell powertrains by 2030.Bosch’s Feuerbach factory near Stuttgart and Chongqing will start fuel-cell power module production.NKLA closed Friday at $2.25, 19.7% below its morning high of $2.80.
Tesla tax credit countdown
Tesla (NASDAQ:TSLA), the world’s most valuable car manufacturer, announced Tuesday evening on its website that federal tax incentives for its Model 3 car will fall at year’s end.
“The $7,500 federal tax credit will likely decrease after December 31, 2023 for some models,” a letter to owners stated. The full credit applies to Model 3 and Model Y vehicles delivered by December 31, 2023.
A vehicle’s battery components must be made or built in North America to receive half of the $7,500 credit. The corporation receives the other half of the credit if at least 40% of the battery’s essential minerals come from the U.S. or a free trade agreement country.
Next year, they will be 60% and 50%.
Rivals race India
Tesla has been seeking to enter India, which does not have a free trade deal with the US.Tesla has resumed investment talks in India, the Times of India reported on Thursday. The business is negotiating with the Indian government to build a 500,000-EV-per-year facility, according to reports.
The vehicles will cost 2 million rupees (1 rupee = $0.012), twice as much as India’s most cheap EV, the MG Comet, and a half-million rupees more than the Tata (NS:TAMO) Nexon EV. BYD (SZ:002594) submitted a $1 billion investment plan with Megha Engineering to manufacture electric vehicles and batteries in India. BYD and Megha proposed an EV joint venture to Indian regulators, Reuters reported. This partnership aims to build a wide range of BYD electric automobiles in India.TSLA closed Friday at $281.38, up 3.2%.
Outlook for the week on energy and precious metals
WTI Crude Technical Forecast
Sunil Kumar Dixit, chief technical strategist at SKCharting.com, said the next big upside target for U.S. oil is a swing high of $83.50, followed by the 100-week SMA of $85.10 and the monthly Middle Bollinger Band of $86.20. He warned that the short-term outlook was shaky, with early price action between $77.30 and $73.70.
“Continuation of last week’s bullish momentum hinges on stability above the weekly middle Bollinger Band of $73.70,” stated Dixit. “Further advances require a strong breakout above the 50-week EMA, or Exponential Moving Average, of $78.50.”
While WTI’s RSI, or Relative Strength Index, offers support throughout daily and weekly timeframes, Daily Stochastics negative may force a pullback into the 100-day SMA of $73.50, below which the 50 Day EMA $72.35 may be tested.
Gold: Forecast
SKCharting’s Dixit expects spot gold to find support this week at the 100-day SMA of $1,953 and the 50-day EMA of $1,945, which if broken could send prices down to the $1,938-$1,935 support zone. “This is a turning point with risk of deeper correction to $1,927-$1,915.
“All things being equal, stability above $1,953-$1,945 will keep chances valid for a resumption of the uptrend which needs a retest of the $1,963-$1,965 horizontal resistance zone, followed by a decision breakout above, for the next leg higher of $1,975 and the previous month’s high of $1,983.”
Gas Price Forecast
Dixit noted that natural gas once again settled below the 5-week EMA.
“Going into the week ahead, the 50-day EMA of $2.52 is fragile support, below which the 100-day SMA of $2.40 and the weekly Middle Bollinger Band of $2.39 are closely aligned support areas that are likely to hold,” he said. The market was likely to stay range-bound in the short future.”
“Over an extended period, a strong and decisive breakout above the 5-month EMA of $2.75 will promptly retest natural gas’ swing high of $2.84 and psychological handle of $3.00, followed by the 100-month SMA of $3.25,” he said. The 50-week EMA of $3.72 and 200-week SMA of $3.75 are the major upside targets.
Barani Krishnan does not own the commodities and securities he writes about.
MAJOR DEALS
Microsoft-Activision regulatory issues persist.
Microsoft’s (NASDAQ:MSFT) proposed takeover of Activision Blizzard (NASDAQ:ATVI), the largest gaming deal ever, faces regulatory hurdles in the U.S. and U.K.Microsoft won late Friday when the U.S. Federal Trade Commission (FTC) failed to get a court injunction to prevent the merger.
Microsoft’s updated application claimed major changes in circumstances, so the U.K.’s Competition and Markets Authority (CMA) prolonged its evaluation period, Reuters reported Friday.Microsoft gained 2%, while Activision gained over 9%.
VMware stock rises after EC clearance of Broadcom merger.
Broadcom (NASDAQ:AVGO) acquired VMware (NYSE:VMW) for $61 billion with European Commission conditional clearance.Broadcom gained legal and foreign investment control approval for the deal in Australia, Brazil, Canada, South Africa, and Taiwan.
Broadcom believes the deal will finish in fiscal year 2023.VMware gained almost 10% and Broadcom about 5% this week.
Exxon Mobil buys Denbury for $4.9B
As reported in real time on InvestingPro, Exxon Mobil (NYSE:XOM) agreed to purchase Denbury Resources (NYSE:DEN) for $4.9B in an all-stock transaction on Thursday.
The arrangement gives Denbury shareholders 0.84 Exxon Mobil shares every Denbury share.
Improved 3D Systems merger offer boosts Stratasys stock.
Stratasys (NASDAQ:SSYS) shares rose nearly 9% on Thursday after 3D Systems (NYSE:DDD) made another increased merger offer. In this newest iteration, Stratasys shareholders would receive $7.50 in cash and 1.5444 shares of the combined company, representing 44% ownership.
After Stratasys rejected Nano Dimension’s second unsolicited partial special tender offer earlier this week, Nano revised the offer to $24.00 in cash from $20.05 to buy 31.9%-36.9% of outstanding ordinary shares.This follows Desktop Metal’s $1.8 billion all-stock acquisition of Stratasys in May. Stratasys is examining Nano’s bid after rejecting 3D Systems’ prior approaches.Stratasys shares rose almost 17% last week.
Insider trade & Hedge fund action
Wildcat Capital opposes Consolidated Communications deal.
Wildcat Capital Management, which manages David Bonderman’s wealth, advised Consolidated Communications (NASDAQ:CNSL) to reject a $2.9 billion purchase bid.Wildcat, which owns 2.6% of Consolidated Communications, told the board on July 12 that the $4-per-share all-cash offer undervalues the broadband services provider by 3.5 times.
Searchlight Capital, a private equity firm that owns 34% of Consolidated Communications, spearheaded the offer.No updates have been provided by Consolidated Communications’ special committee reviewing the offer. Wednesday shares rose 16% to $4.19. This topped the $4 offer price, suggesting investors expect a higher bid soon.
Children’s Place CEO buys $1 million stock.
Children’s Place (NASDAQ:PLCE) CEO Jane Elfers bought 43,000 common shares at $23.70 each, worth over $1 million.
Moskovitz purchases Asana shares.
CEO Dustin Moskovitz bought 160,000 common shares for $3.4M.
Moskovitz now owns 40,232,803 common shares directly and 4,147,046 indirectly through a trust.In March 2023, he announced his aim to buy 30M shares by 2023. He bought 1.12M shares since the plan’s introduction.
Wells Fargo downplays Silver Lake’s Dell equity sale.
Wells Fargo downplayed Silver Lake’s 3.529 million Dell Technologies (NYSE:DELL) share sale on Wednesday. The analyst stated that Silver Lake’s Class B shareholding was 3.7% and Dell’s outstanding shares were 0.49%.
Weekly Earnings Calendar
MONDAY
Equity Lifestyle Properties Inc. (ELS)
TUESDAY
Bank of America (BAC), Morgan Stanley (MS), Novartis (NVS), Lockheed Martin (LMT), Prologis Inc. (PLD), The Charles Schwab Corporation (SCHW), PNC Financial Services (PNC), Bank of New York Mellon (BK), J.B. Hunt Transport Services (JBHT), Omnicom Group Inc. (OMC), Synchrony Financial (SYF), and Hasbro Inc. (HAS)
WEDNESDAY
Tesla (TSLA), Netflix (NFLX), IBM (IBM), Goldman Sachs (GS), Elevance Health (ELV), U.S. Bancorp (USB), Crown Castle Inc. (CCI), Las Vegas Sands (LVS), Biogen Inc. (BIIB), Kinder Morgan (KMI), Baker Hughes Co. (BKR), Halliburton (HAL), Discover Financial Services (DFS), Equifax Inc. (EFX), Nasdaq Inc. (NDAQ), and United Airlines (UAL)
THURSDAY
Taiwan Semiconductor Manufacturing Company (TSM), Johnson & Johnson (JNJ), Abbott Laboratories (ABT), SAP (SAP), Philip Morris International (PM), Intuitive Surgical Inc. (ISRG), Marsh & McLennan Cos. (MMC), CSX Corporation (CSX), Blackstone Inc. (BX), Freeport McMoran (FCX), Kenvue (KVUE), Truist Financial Corp. (TFC), Capital One Financial (COF), D.R. Horton (DHI), and The Travelers Companies (TRV), and Newmont Corp. (NEM)
FRIDAY
American Express Co. (AXP), HDFC Bank Ltd. (HDB), The Progressive Corporation (PGR), Schlumberger (SLB), Roper Technologies Inc. (ROP), Regions Financial Corp. (RF), and Huntington Bancshares Inc. (HBAN)
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