If the stock market’s quick ascent turned out to create a multi-bubble, historians would assess what happened. Currently, the Magnificent 7, which includes Tesla (TSLA), Apple (AAPL), Nvidia (NVDA) and Microsoft (MSFT), and the artificial intelligence boom are potential bubbles.
Bears may point to the shakeout in the electric vehicle market that began late last year. Tesla showed signs of the market’s weakness when it slashed prices. More recently, Reuters wrote that Tesla canceled an affordable Tesla 2 (for $25,000). The deteriorating EV market sets Rivian (RIVN) as the stock to watch. Shares fell by 8.0% and were the 10th most actively traded stock.
Gas-powered and hybrid automotive supplier Ford Motor (F) fell in sympathy. At $12.23, F shares are about to trade at the familiar $12.00 price level. $12 is a support price for both Feb. and March. Watch out for stronger seller momentum. Investors do not want to hold consumer cyclical stocks when inflation hurts spending levels.
Intel (INTC) barely bounced back after falling throughout this month. Relative to its potential growth ahead, shares are not cheap. Super Computer Micro (SMCI) and Nvidia both have better a profit profile in 2024. Despite the varying forecasts among those firms, bears may dominate the market. That would send NVDA, SMCI, and INTC stock lower from here.
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