Although it underwent a serious selloff, dropping from nearly $330 per share to $273 in less than a week, along with the broader stock market indices, Apple made a dramatic move higher Monday.
Shares in the tech behemoth rocketed 6.9% higher on Monday, aided by a larger Wall Street rebound and an upgraded rating from an analyst who said the iPhone maker’s stock had succumbed to overzealous selling following last week’s rout related to fears about the new coronavirus.
Oppenheimer upgraded its rating on Apple to “outperform” from “perform”, noting that the tech giant was more ready than its competitors to deal with the effect of the global health crisis caused by the coronavirus. Apple’s stock plummeted over 16% from its record high on Feb. 12 through Friday.
Monday’s bounce helped Apple’s stock capture its largest one-day gain since December 2018.
Like many tech companies, Apple leans heavily on China, where the coronavirus has most dramatically affected production at its factories and ushered consumers away from retail shops.
“Our limited checks indicate Apple will prove more resilient than others as firms worldwide navigate changing supply chains and customer demand uncertainty,” Oppenheimer analyst Andrew Uerkwitz wrote in a client note.
On Monday investors scrambled back into beaten down stocks, betting that the global central banks will take action immediately to combat a virus-triggered slowdown, which they did take, ushering in a new selloff in the process.
Still, the Dow notched impressive gains, soaring nearly 1,300 point on the day, its biggest point gain in history, where it snapped a seven-day losing streak, and with Monday’s rally, it recovered more than 40% of its losses from Feb. 19 close to Friday’s intraday low. Meanwhile the S&P 500 jumped 2.8% as investors also bet that monetary stimulus from central banks would cushion the economic impact of the coronavirus.
For investors looking to use ETFs to play a further rise in Apple, the Technology Select Sector SPDR ETF (NYSEArca: XLK), iShares U.S. Technology ETF (NYSEArca: IYW), Fidelity MSCI Information Technology Index ETF (FTEC), and the Vanguard Information Technology ETF (NYSEArca: VGT) are all ETFs to consider.
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