More Techs Coming to Life

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Bull in ring

Tech stocks keep jumping as stocks nudge higher.

Yesterday, we covered how names like Apple (AAPL) and Cisco Systems (CSCO) were sneaking to new highs. Today that trend continued as other prominent technology stocks also hit new records.

First and foremost is Amazon.com (AMZN), which is more than 1 percent above its previous 52-week high. The catalyst was a bullish call from Morgan Stanley, which raised its price target from $1,850 to $2,500. That’s the highest number on Wall Street.

The big narrative at AMZN now, by the way, is margin expansion as Jeff Bezos wrings more profits out of his Amazon Web Service cloud juggernaut. Investors may also see a profit boost from advertising. That one almost feels like “free money,” when you consider Amazon.com has almost no advertising despite being the No. 4 site in the U.S.

Then you have Microsoft (MSFT), which shot to its first new high in over a month. Interestingly, we were just looking at this one on Monday’s Market Action webinar. David Russell mentioned buying the MSFT October 110 calls as a way to capitalize on gamma. At the time they were offered for $2.85. This morning they’re worth $4.10.

Electronic payment companies also continue their blitz higher as Square (SQ) and PayPay (PYPL) both set new records. There are plenty more, especially in the software space. For example look at Adobe Systems (ADBE) and Workday (WDAY). As we’ve emphasized repeatedly on Market Insights, cloud computing is a major trend pulling dozens of stocks higher.

Then there’s the other tech: Biotech. Most of these are listed on the Nasdaq, so they’re helping to send that tech-heavy index higher by more than 1 percent so far today. Vertex Pharmaceuticals (VRTX) hit a new high today, along with the iShares Nasdaq Biotech ETF (IBB). Others like Regeneron (REGN) and Celgene (CELG) are on the move, as well.

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Dr. Don Pratl is Director of Trader Development and Education for TradeStation. He joined TradeStation in 2016 after holding similar roles with other online brokerages. Don’s long career in the financial services industry reflects expertise in administering trading and investment strategy programs for retail investors as well as financial services professionals. Since the 1980s, he has held various positions in areas including CBOE trading floor order execution, marketing, sales, personnel management, training and customer service. Don holds series 3, 4, 7 and 63 FINRA licenses, earned his Ph.D. in Organization and Management, and his M.A. and B.A. in Political Science. He has been an occasional adjunct college instructor since 2004 at a range of institutions, teaching undergraduate, graduate and doctoral students using in-class and online formats.