Tech, Drug Stocks Lift Wall Street Spirits

At least five tech stocks hit record highs

Digital Content Manager
Jul 10, 2020 at 1:26 PM
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Highlighting the second week of July was a multi-day surge out of the Nasdaq Composite (IXIC) to record highs, thanks to an outperforming tech sector. FAANG stocks soared for a majority of the week, as stay-at-home stocks once again became favorites due to a resurgence of COVID-19 cases. Specifically, Apple (AAPL), Amazon.com (AMZN), and Netflix (NFLX) all hit record peaks at least once by Thursday’s session. News also came to light that President Donald Trump wants to pull the country out of the World Health Organization (WHO), on the heels of an announcement endorsed by 200 scientists that coronavirus can spread through the air. Cases continued to spike across the country, with Florida making a name for itself as the latest "hot spot."

Despite word from John Hopkins University that the world has officially surpassed 3 million COVID-19 cases, the technology sector continued to outperform the broader market on Wednesday. And while it briefly cooled off in Thursday’s trading, tech closed on top, this time accompanied by the pharma sector, as multiple positive vaccine updates hit the news cycle. Both the Dow Jones Industrial Average (DJI) and S&P 500 Index (SPX) saw minimal changes for the week.

Tech Sector Runs Full Speed Ahead

The technology sector continued to grow stronger, despite concerns over surging coronavirus cases in different parts of the world. On Monday, Tesla (TSLA) grabbed another all-time-high, after it earned price target hikes from two firms and CEO Elon Musk said on Twitter the company would expand mega factories outside of China. Analysts were also singing another tech giant's praises on Thursday -- Microsoft (MSFT) grabbed its sixth record high this month, and earned a price-target hike to top. Meanwhile, mega-retailer Walmart (WMT) is looking to further dip its toes in the technology sector. It was reported that WMT will launch a new membership program in July, in direct competition with Amazon's Prime service.

Vaccine Updates Sweep Pharma Sector

Three major drug stocks made headlines this week. Most notably, Novavax (NVAX) soared on Tuesday after the U.S. government awarded the company $1.6 billion to cover testing, commercialization, and manufacturing of a potential  coronavirus vaccine, with the goal of delivering 100 million doses by January 2021. Meanwhile, Biogen (BIIB) rose on Wednesday, after it submitted a marketing application to the Food and Drug Administration (FDA) regarding a new Alzheimer's disease treatment. And finally on Thursday, Halozyme Therapeutics (HALO) pulled back from an all-time-high, which according to Schaeffer's Senior Quantitative Analyst Rocky White, means the stock could be overdue for a short squeeze.


Bank Stocks Highlight Upcoming Week

After a relatively quiet last couple of weeks, Wall Street action will heat up next week, as investors await key economic indicators in the midst of the coronavirus resurgence. The consumer side of the economy will be highlighted, with the Core Consumer Price Index (CPI) and retail sales data due out. As far as earnings go, banks will be at the forefront.
You can also take a look at what the stock market might be telling traders in its current climate, and whether or not a win streak can determine the market’s next move.

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