On today’s episode of Free Lunch here at Zacks, Associate Stock Strategist Ben Rains discusses why U.S. stocks jumped again Tuesday, despite the continued spread of the coronavirus. The episode also takes a look at Google parent Alphabet’s quarterly results and Tesla’s (TSLA - Free Report) insane run. We then preview Disney (DIS - Free Report) earnings and close with why Microsoft (MSFT - Free Report) is a Zacks Rank #1 (Strong Buy) stock right now.
The Dow, S&P 500, and Nasdaq all jumped over 1.3% in morning trading Tuesday, as they try to rebound from last week’s coronavirus-based slide. The move might signal that Wall Street doesn’t think the coronavirus outbreak, which is still contained mostly within China, will dramatically impact the global economy.
And the case for why U.S. markets will once again grow in 2020 isn’t that hard to make. For instance, corporate earnings are projected to bounce back in 2020, interest rates and U.S. unemployment remain low, and the U.S. economy is expected to expand by at least 2% in 2020. Plus, Q4 earnings season has been solid, with Apple (AAPL - Free Report) , Amazon (AMZN - Free Report) , and other giants all blowing away Wall Street in the last week of January alone.
Meanwhile, Tesla stock has now soared over 100% already in 2020, driven by strong Q4 results and a solid growth outlook. Elon Musk’s electric automaker is set to expand its global reach going forward and its current run is marking things tough for Tesla short-sellers.
Unlike Tesla, Google parent Alphabet saw its stock price fall after the firm underwhelmed investors despite finally breaking out sales for YouTube and its cloud computing unit.
Ralph Lauren (RL - Free Report) stock, on the other hand, soared Tuesday. Looking ahead, Chipotle (CMG - Free Report) , Ford (F - Free Report) , Disney, and other big names are set to report after the closing bell.
Disney is likely to grab a ton of attention as the entertainment giant posts its first quarterly results since it launched its streaming TV platform that aims to challenge Netflix (NFLX - Free Report) .
We then close with a look a why Microsoft is currently a Zacks Rank #1 (Strong Buy) stock.
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