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🍎 Apple Of The DOJ's Eye
Apple gets hit with a major antitrust lawsuit. Plus, Reddit shares pop on debut.
Brooks Dyroff
March 21, 2024
Happy Thursday, Zingers! Hope you had a great day of watching basketball… I mean, “working.” But the NCAA wasn’t the only madness we saw today.
Reddit’s stock officially hit the market, debuting on the New York Stock Exchange this afternoon. The stock rose nearly 50% from its planned open price of around $34 a share, and closed at $50.
A promising start, but I do have one concern regarding company management. Specifically, they should have given me some shares for the work I did as an r/FidgetSpinner moderator back in 2017.
Today’s Price Action:
$SPY: +.33%
$QQQ: +.47%
$DIA: +.70%
Also, want to make some extra cash without picking up a second job? Check out today’s partner.
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TODAY’S MOST VOLATILE STOCKS
TODAY’S TOP STORY
Briefly: Apple is facing another antitrust case from the U.S. Department of Justice (DOJ).
So Basically: The case alleges the tech giant has a monopoly over the phone market, arguing that “Apple unfairly penalizes competitors and tech rivals by blocking other tech players from accessing hardware and software features of its flagship iPhone," according to Wedbush analyst Daniel Ives.
So Then: The analyst, who has an Outperform rating and $250 price target for the tech giant, said the antitrust lawsuit will "kick off a stepped up phase of the Beltway going after Apple."
So What? The lawsuit could challenge the "core business model" of Apple, Ives added. However, it could take years in the courts. "Apple has defended its App Store, ecosystem, 30% fee, and business model again and again in the courts and EU and we would expect a similar battle here," Ives said.
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FIVE MOVERS
Lululemon shares slid after the close after the athleisure company reported weaker-than-expected guidance.
Accenture shares reported earnings before the open today, and missed the mark. The consulting giant closed lower by nearly 10% in the session.
Crocs shares closed up more than 5% today after an analyst at BofA securities raised his price target from $140 to $150.
Illumina shares moved higher today following a favorable ruling from an EU court regarding an acquisition.
Nike shares moved higher today after the close after the shoe-maker reported stronger-than-expected earnings.
ONE TRADE IDEA FOR TOMORROW
Briefly: Most investors are eagerly anticipating the Fed’s first rate cut of this cycle. But former U.S. Treasury Secretary Lawrence Summers is not one of them.
The Take: During an appearance on Bloomberg Television’s Wall Street Week, Summers expressed perplexity over the Fed’s current stance, especially considering the healthy state of the economy and financial markets.
The Quote: “My sense is still that the Fed has itchy fingers to start cutting rates, and I don't fully get it,” Summers said.
The Context: Fed Chair Jerome Powell suggested recent hotter-than-expected inflation prints do not alter the broader expectation of diminishing price pressures. The Fed’s quarterly projections released this week still show three rate cuts in 2024.
The Big Picture: Summers argues that the Fed’s understanding of the neutral policy rate — or the theoretical level at which the federal funds rate is neither stimulative nor restrictive — is flawed, which may be undermining the central bank’s entire approach to monetary policy.
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Join this live bootcamp to deepen your understanding of leveraged and inverse ETFs and learn how to successfully trade them. With expert-led sessions and live case studies, this bootcamp offers an immersive learning experience you don't want to miss out on. Audience members are encouraged to ask questions in the chat at any time during the 90-minute bootcamp.
Date: Saturday, March 23th 2024
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