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Stocks are down for the second consecutive day. Yesterday Apple (NASDAQ: AAPL) and Amazon (NASDAQ: AMZN) reported quarterly earnings.
Both companies reported a decent quarter – given the Covid-19 outbreak and economic fallout. However, the results show that even America’s best tech stocks are feeling the pain.
Amazon sales surged 29% during the first three months of 2020. The company has benefitted from a surge in online purchases as consumers avoid retail stores.
Yet the cost of doing business is also rising. Amazon’s profits fell 29% during the quarter.
Amazon CEO Jeff Bezos warned that profits will be lower during the rest of 2020.
The company would typically expect to earn $4 billion in operating profits during the second quarter of the year.
“We expect to spend the entirety of that $4 billion, and perhaps a bit more, on Covid-related expenses getting products to customers and keeping employees safe,” Bezos warned.
Increased expenses include $300 million for testing workers, increased pay and overtime, and a decline of efficiency due to social distancing requirements.
Amazon’s grocery business includes Whole Foods. That segment of the business grew by 8%. Meanwhile, online grocery orders have increased by 60%.
The Big News . . .
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Open for Business: U.S. States Re-Open
Retail stores In Texas and Alabama are re-opening today. Meanwhile, California and New York remain vigilant in restricting business activity.
New Jersey: More Deaths Than Any Other State
The garden state reported 460 deaths on Thursday. That’s more than any other state – including neighboring New York. The state has the second-highest number of total deaths.
Armed Protesters in Michigan’s Capitol
A group of armed protesters entered Michigan’s Capitol building on Thursday. It is legal to carry firearms in the state capitol. The state’s Democrat governor is extending stay-at-home orders. Meanwhile, Republican lawmakers are threatening a lawsuit aimed to re-open the state.
New $1 Trillion Stimulus
Republicans on Capitol Hill are starting work on another stimulus bill. This one is expected to top $1 trillion and call for huge spending on infrastructure projects including 5G. Go here for the top All American 5G stocks to BUY NOW.
The Coronavirus Numbers
Here are the numbers from Friday at 10:30 a.m. ET.
- 3,333,193 Infected worldwide
- 235,121 Deaths
- 1,099,275 Infected in the U.S.
- 63,972 Deaths in the U.S.
What’s Next
Stocks just finished their best month since 1987.
The stock market finished up April with 13% gains. And that takes the stock market to 30% gains since the March 23 lows.
The speed of the recovery for stocks has shocked most institutional investors and market experts.
The market’s gains come amid a bleak picture for the U.S. economy. J.P. Morgan expects the nation’s GDP will drop by 40% during the second quarter of this year. And the Congressional Budget Office says unemployment could hit 16% this year.
There’s a ton of uncertainty regarding corporate earnings. And most companies are withdrawing any guidance for 2020.
Yet a small group of traders have had a chance to profitably trade stocks during earning season. And some are even WINNING 100% of these “Overnight Trades.”
In fact, the next trade alert is going out early next week. And you could earn a quick profit of $1,000 – $2,000 – even if you have a small account.
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Yours in Health & Wealth,
Ian Wyatt