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Nasdaq hits new high in longest win streak since December

CNBC logo CNBC 6/23/2020 Fred Imbert, Maggie Fitzgerald and Eustance Huang

The Nasdaq Composite finished at a record high Tuesday, with Apple leading major tech names up as investors cheered a slew of announcements from the tech giant’s WorldWide Developers Conference.

The tech-heavy index gained 0.7%, notching its eighth straight daily gain. That marks the Nasdaq’s longest winning streak since December, when it advanced for 11 straight sessions.

The Dow Jones Industrial Average climbed 131 points, or 0.5%. The S&P 500 gained 0.4%.

Apple rose 2.1% and reached an all-time high. On Monday, the company unveiled new operating systems for its iPhones and computers. Apple also said it would use its own chips when building new Mac computers, ditching Intel’s in the process.

UBS analyst Timothy Arcuri said the transition away from Intel chips is a “continuation of its strategy of vertical integration following years of convergence” in its mobile and Mac products. Arcuri hiked his price target on the stock to $400 per share from $325 per share. The new price target implies an 11% upside from Monday’s close of $358.87.

Other tech-related names also lifted the broader market. Facebook advanced 1.3%. Amazon hit all-time high, closing 1.9% higher. Bank stocks rose broadly. JPMorgan Chase, Citigroup and Bank of America all rose at least 0.7%.

The rally put the S&P 500 up more than 42% from its March 23 intraday low. The broad-market index was also down just 3.1% year to date.

“It feels in some ways the markets have a case of revenge spending,” said Mike Bailey, the director of research at FBB Capital Partners. “It feels like people have been cooped up and they’re buying everything the can.”

“There’s a positive bias here, and investors are just running with it,” Bailey said.

Overnight volatility

Tuesday’s gains came after a volatile overnight session amid comments from White House trade advisor Peter Navarro. Dow futures had dropped about 400 points overnight after Navarro’s Monday interview on Fox News’ “The Story.”

Fox’s Martha MacCallum asked, “Do you think that the president sort of ... I mean, he obviously really wanted to hang onto this trade deal as much as possible. And he wanted them to make good on the promises because there had been progress made on that trade deal, but given everything that’s happened and all the things you just listed, is that over?”

“It’s over. Yes,” Navarro responded.

In his subsequent statement, Navarro said, “I was simply speaking to the lack of trust we now have of the Chinese Communist Party after they lied about the origins of the China virus and foisted a pandemic upon the world.”

“My comments have been taken wildly out of context,” Navarro added. “They had nothing at all to do with the Phase I trade deal, which continues in place.” This clarification sent stock futures back higher.

In his interview with Fox, Navarro said “the turning point” came when the U.S. heard about the coronavirus outbreak in China. Navarro claimed that the administration only heard about the virus after the trade deal between Washington and Beijing was signed on Jan. 15.

President Donald Trump also tweeted that the existing trade deal remains in place.

Stocks were coming off solid gains as shares of major tech companies led the major averages higher on Monday. Those gains came despite a rising number of newly confirmed coronavirus cases in the U.S.

“The message today may be that the virus and the bull market can coexist,” Jim Paulsen, an investment strategist at the Leuthold Group, told CNBC. “Despite back to back days of Covid19 cases above 30,000 over the weekend and ongoing reports of hot spots, the stock market managed to post a strong gain. Market action seems to suggest that investors expect the economy to continue improving in the months ahead even though the country is likely to experience spotty or temporary spikes in the virus.”

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