Tech Stocks Rebound in Best Half-Year Since 1983, Rising 32% (cnbc.com) 39
CNBC reports:
On Friday, the Nasdaq wrapped up the first six months of the year with a 1.5% rally, bringing its gains so far for 2023 to 32%. That's the sharpest first-half jump in the tech-heavy index since 1983, when the Nasdaq rose 37%...
[M]omentum is always a driver when it comes to tech, and investors are notoriously fearful of missing out, even if they simultaneously worry about frothy valuations. Coming off a miserable 2022, in which the Nasdaq lost one-third of its value, the big story was cost-cutting and efficiency. Mass layoffs at Alphabet, Meta and Amazon as well as at numerous smaller companies paved the way for a rebound in earnings and a more realistic outlook for growth. Meta and Tesla, which both got hammered last year, have more than doubled in value so far in 2023. Alphabet is up 36% after dropping 39% in 2022... Nvidia shares soared 190% in the first half, lifting the 30-year-old company's market cap past $1 trillion.
"I think you're going to continue to see tech dominate because we're still all abuzz about AI," said Bryn Talkington, managing partner at Requisite Capital Management, in an interview with CNBC's "Closing Bell" on Thursday. Talkington, whose firm holds Nvidia shares, said the chipmaker has a unique story, and that its growth is not shared across the industry. Rather, large companies working on AI have to spend heavily on Nvidia's technology. "Nvidia not only owns the shovels and axes of this AI goldrush," Talkington said. "They actually are the only hardware store in town."
Apple hasn't seen gains quite so dramatic, but the stock is still up 50% this year, trading at a record and pushing the iPhone maker to a $3 trillion market cap.
The article points out that the last time Nasdaq stocks had a better first-half of the year, "Apple was touting its Lisa desktop computer, IBM was the most-valuable tech company in the U.S. and Mark Zuckerberg hadn't been born."
[M]omentum is always a driver when it comes to tech, and investors are notoriously fearful of missing out, even if they simultaneously worry about frothy valuations. Coming off a miserable 2022, in which the Nasdaq lost one-third of its value, the big story was cost-cutting and efficiency. Mass layoffs at Alphabet, Meta and Amazon as well as at numerous smaller companies paved the way for a rebound in earnings and a more realistic outlook for growth. Meta and Tesla, which both got hammered last year, have more than doubled in value so far in 2023. Alphabet is up 36% after dropping 39% in 2022... Nvidia shares soared 190% in the first half, lifting the 30-year-old company's market cap past $1 trillion.
"I think you're going to continue to see tech dominate because we're still all abuzz about AI," said Bryn Talkington, managing partner at Requisite Capital Management, in an interview with CNBC's "Closing Bell" on Thursday. Talkington, whose firm holds Nvidia shares, said the chipmaker has a unique story, and that its growth is not shared across the industry. Rather, large companies working on AI have to spend heavily on Nvidia's technology. "Nvidia not only owns the shovels and axes of this AI goldrush," Talkington said. "They actually are the only hardware store in town."
Apple hasn't seen gains quite so dramatic, but the stock is still up 50% this year, trading at a record and pushing the iPhone maker to a $3 trillion market cap.
The article points out that the last time Nasdaq stocks had a better first-half of the year, "Apple was touting its Lisa desktop computer, IBM was the most-valuable tech company in the U.S. and Mark Zuckerberg hadn't been born."
Really? (Score:5, Insightful)
The same stocks of the companies that lament a lack of workers while at the same time firing them by the thousands? Those stocks?
Re: Really? (Score:5, Insightful)
Re: (Score:3)
It might surprise you, but stock prices can be very disconnected from economic outlook. GameStop in 2021 comes to mind. NVidia right now too.
Interestingly, MarketWatch has this article [marketwatch.com] about Nvidia which asks the question: How long can a stock grow faster than the market?
Re: (Score:3)
Re: Really? (Score:4, Interesting)
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That poses a bit of a problem.
One of the points of markets is that they can do reasonable valuations (indeed, one of the problems with communism was an inability to even make marginal valuations).
You remove that, and the benefits of markets becomes extremely suspect (yeah yeah yeah, subjective valuations and all that, but how often are you stuck in a desert with a bag full of diamonds and one guy with a case of water).
Mass delusion as a market property is just doomed to failure.
Re: Really? (Score:3)
Re: Really? (Score:2)
Re: (Score:3)
They aren't getting rid of the dead wood. I don't see a lot of middle managers getting the axe.
And yes, I'm irreplaceable. Or rather, replacing me is more complicated than replacing a useless middle manager that tries to fire me.
Re: (Score:2)
Fire people --> save in labor cost expenses --> augment profits --> distribute profits to shareholders --> stocks rebound.
Also, half the inflation is caused by the augmentation of companies' profits [yimg.com] (== shareholder requests for more dividends).
Re: (Score:3)
Your request for a free pentest of your webpage has been granted and results will be posted here.
Unstable stock prices (Score:1)
are bad news. They're more indicative of an upcoming bubble than true economic growth.
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Re: (Score:1)
post:
Stop being so negative!
.sig:
Life isn't a zero-sum game.
Yes, switch to unsigned integers now!
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Re: (Score:1)
If you truly believe that, then buy stock puts and shorts so you get a payout if they deflate soon. I'm more likely to trust those who put their money where their mouth is.
Re: (Score:2)
Then you can trust me completely, because my mouth says the stock market is a casino ran by fraudsters to con fools out of their money, and none of mine is invested in it.
Re: (Score:3)
Last person in is going to be the loser. You should jump in now, if not to protect my investments, you
Re: Unstable stock prices (Score:2)
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"individual stocks can be run-up by buyer's sentiment. GameStop will probably be forever the champion of that,"
No it won't, cuz that's not what did it. The stock price blew up because Melvin Capital and others were massively short GME, shorting more stock than was even in circulation. Blaming it all on retail traders is an MSM fantasy
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In the long run it probably is a big ponzi scheme. But it could also last another 100 years (before the bots overthrow humans).
Don't get too excited (Score:4, Interesting)
Coming off a miserable 2022, in which the Nasdaq lost one-third of its value,
So if lost 1/3 of its value last year, and gained 32% this year, it's still hasn't fully recovered.
100-33 = 67
67 X .32 = 21.44
67 + 21.44 = 88.44
That's still 12.5% lower than where it was a year ago.
Re: (Score:2)
When discussing statistics of anything, we should just draw a straight line between 2019 to 2023/24. People like to fixate on the wild fluctuations during the covid era, which are meaningless in the long term.
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When discussing statistics of anything, we should just draw a straight line between 2019 to 2023/24. People like to fixate on the wild fluctuations during the covid era, which are meaningless in the long term.
That's the thing I always hated about statistics. When calculating the average or mean you drop out the outliers. No, you don't. Those are part of the statistics. It doesn't matter that they skew things one way or the other, they are the part of the data and should be used.
Might as well not bother adding in the Great Depression figures because clearly they skew the market statistics.
Re: (Score:3)
Then you were taught statistics incorrectly. Lots of people will tell you this. They either (a) don't know what they're talking about; (b) are using a different definition of "outlier" than you assume; or (c) both.
You can drop outliers, but you should only do it after you've figured out why they're outliers and demonstrated that process makes them irrelevant to whatever you're trying to quantify
Re: (Score:2)
Shame they fired so many valuable workers as soon as the economy got the sniffles. Their recovery could have been much stronger with the right people in place.
Re: Don't get too excited (Score:2)
QQQ (Score:2)
QQQ has been on a tear this year. It focuses on the tech stocks that have gone up so much. I am late to the party but I bought a little last week. Already up and probably will continue, but I put in a stop.
https://finance.yahoo.com/quot... [yahoo.com]
A reframe (Score:3)
The rally over the past few month has erased the losses incurred over the last 18 months when things were at their peak. One could say that we're back to normal but that's just not the case when you look at the face of the devil in the details. Small businesses are in trouble. They are downsizing having gotten slammed by a) higher costs and b) lower sales. Not to mention that the supply chain is still a sh*t show. If vendors have inventory, the price is now double or triple what it was 2 years ago. If they don't have inventory, the lead times are so far out that OEMs are burning through any cash reserves they had to stay in business with no sales prospects. Oh, and vendors all have an attitude like they are doing you a favor by even talking to you if they return phone calls or emails.
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>"One could say that we're back to normal but that's just not the case when you look at the face of the devil in the details. Small businesses are in trouble"
We are definitely not back to normal. We still are at a big loss in retirement values. We still have huge inflation which is robbing everyone of purchasing power. We still have many banks that are on the edge of failing. We lost TONS of small businesses that employ tons of people and add a lot to economy. Money is tight for investment in normal
the tech industry is doing great (Score:2)
We have billionaires buying profitable businesses and running them into the ground [cnn.com] as his own personal playground. Top tech CEOs are enjoying the public spectacle that is a theoretical cage match [wsj.com]. Things are doing great, no cracks in these boom times.
dishonest use of stats (Score:2)
If some guy beats his wife one year and breaks 10 of her bones and the next year beats her less and breaks only 4 bones, he can claim a "record reduction" in her injuries. Context matters.
With all the COVID shutdowns that massively reduced employment, and productivity, and projected (and realized) sales, etc, even the most-sluggish re-opening/recovery can be seen as stellar, particularly in percentages. If there were 100 people with jobs, then 80 were locked down (leaving 20 working), and then after re-open
Dead Cat Bounce (Score:2)
This isn't a recovery. It's a bunch of bulls about to lose their shirts in a bear market. This is a known and predictable effect called a "dead cat bounce" [wikipedia.org]. Either the analysts from CNBC know this and are trying to pump up the bounce to increase the strength of their personal short positions and thus shouldn't be listened to by anyone, or they don't know this and are thus incompetents and shouldn't be listened to by anyone.