Tesla down 7%·Apple down 2%... New York Stock Market Tech Stocks 'Collapse'

"Just Speculative Desire" JP Morgan Sets Tesla Target Price at $90

[Image source=Reuters Yonhap News]

[Asia Economy New York=Correspondent Baek Jong-min] The New York stock market showed weakness as core tech stocks all fell sharply. Despite continuing its record-high streak at the opening amid good news about the COVID-19 vaccine, it failed to maintain momentum.

On the 9th (local time), the Dow Jones Industrial Average fell 105.07 points (0.35%) to close at 30,068.81, the S&P 500 index dropped 29.43 points (0.79%) to 3,672.82, and the Nasdaq index plunged 243.82 points (1.94%) to finish at 12,338.95.

Apple, the leader of tech stocks, fell 2.1%. Microsoft also dropped 1.9%, and Amazon declined by 2.3%. In fact, Facebook, which was sued by the Federal Trade Commission (FTC) for antitrust violations that day, saw a relatively smaller drop of 1.9%.

Electric vehicle maker Tesla, which had been soaring ahead of its inclusion in the S&P 500 index, fell by 6.9%. This was attributed to investment bank JP Morgan’s recommendation not to chase Tesla’s stock, stating that its price had risen excessively compared to its earnings.

JP Morgan set a 12-month target price for Tesla at $90. In October, JP Morgan had revised Tesla’s target price from $65 to $75. This time, it raised it by 12.5% from $80 to $90. Investment magazine Barron’s mentioned that JP Morgan’s target price is the lowest in the industry and 86% below the current stock price.

JP Morgan has maintained a sell rating on Tesla since 2015. Even as Tesla’s stock price rose over 1500% from when it was $40, JP Morgan’s target price has only increased by 150%.

In contrast, Wedbush Securities raised Tesla’s target price to $1000 last month.

Food delivery company DoorDash, which debuted on the stock market that day, had a spectacular debut with a rise of over 80% compared to its IPO price of $102.

The day after, accommodation sharing company Airbnb will also be listed. Airbnb’s IPO price is also expected to exceed the company’s planned range, indicating a booming year-end IPO market.

Agreement on the much-anticipated stimulus bill remains 'up in the air.' Although Treasury Secretary Steven Mnuchin announced the proposal of a $916 billion stimulus bill to the Democrats the previous day, confidence in reaching a deal remains low.

Gold for delivery in February next year closed down 1.9% ($36.40) at $1,838.50 per ounce. West Texas Intermediate (WTI) crude oil for delivery in January next year closed down 0.2% ($0.08) at $45.52 per barrel.

This content was produced with the assistance of AI translation services.