My top 10 things to watch Tuesday, March 5

  1. It looks like a total breakdown of iPhone sales in China: down 24% in the first six weeks of 2024 in the world’s second-largest economy, Counterpoint Research report says. Apple faces stiff competition local smartphone firms like Huawei, Oppo, Vivo, and Xiaomi as well as Samsung. Understand that my “own it, don’t trade it” on Apple stock doesn’t mean you won’t have some unrealized pain. But the Club can’t short and we can’t own put options, two strategies that can be used to hedge. Shares are down nearly 2.5% early Tuesday. I think iPhone’s are too expensive for China.
  2. Our other “own it, don’t trade it” stock, Nvidia, is rallying into CEO Jensen Huang’s speech at the company’s GTC Conference less than two weeks away. Shares are up 1%.
  3. However, the Super Micro Computer action Monday, up another 18% on news it will be added to the S&P 500 later this month, was not good, raising concerns about froth in chips. Super Micro is now up 278% year to date and nearly 1,000% in the past 12 months. Shares are down 3.5% in premarket.
  4. Advanced Micro Devices‘ AI chip designed for China to meet U.S. government trade restrictions are still too fast, Bloomberg News reported. The government’s determination will hurt AMD’s quarter.
  5. Nvidia said on its post-earning conference call last month that it has started shipping China-specific AI chips to customers for sampling.
  6. Will Alphabet get religion or is it just going to be a rival Amazon and Microsoft cloud service provider? We have sold the Google parent three times. We don’t want to sell it again. Alphabet shares have been under pressure this year and most recently due to its Gemini AI image generator stumble. The stock is down 1% early Tuesday and six out of the past eight sessions.
  7. Wall Street is lower one day after modest losses for the Dow, the S&P 500 and the Nasdaq. All of them, however, were still near all-time highs. Declines in Apple and Alphabet are putting added pressure on the tech-heavy Nasdaq.
  8. It’s a big week ahead: Fed Chairman Jerome Powell on Capitol Hill on Wednesday and Thursday and the government’s February jobs report Friday. Three Club names report this week: Foot Locker on Wednesday morning and Broadcom and Costco Thursday after the bell.
  9. Target shares pop 9% despite light guidance. The quarter was better-than-expected on earnings and revenue. The retailer reported low inventories. Target also said it took a hit in recent quarters from elevated levels of theft and the controversy over its merchandise collection for Pride Month.
  10. After we told investors Monday that Club stock Coterra Energy would be good to own, I spoke to CEO Tom Jorden for “Mad Money” on Monday night. Jorden told me the company can dial up or dial down oil and natural gas based on pricing. Oil has been strong recently, and nat gas has been very weak. The CEO emphasized “flexibility,” which was evident in Coterra’s latest quarter.

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